To walk into the handsome new restaurant Bottega Louie in downtown Los Angeles, guests must first pass through the “market,” a retail space offering baked goods, bottles of wine and olive oil, jars of jelly or chutney, fresh cheeses, charcuterie, and exotic sodas.
If they’re looking for a full-service dining experience, they can carry on to the restaurant side of the 10,000-square-foot space. However, if they just want a quick bite and a few goodies to bring home—caviar, pastries, perhaps a bottle of wine—they will find what they need in the market.
Bottega Louie is one of a growing number of restaurant concepts adding retail food components to their operations with the hope of boosting incremental sales at a time when customers are dining more often at home.
Such operations build traffic during less busy day-parts and appeal to customer demand for convenience, operators say. But, they also point out, there is a learning curve to running a retail operation, and the revenues generated can be small for the effort. Further, a sibling retail operation can confuse consumers about a venture’s primary business.
Nonetheless, many operators are taking the retail challenge and finding creative ways to carve out shopping areas either within their restaurants or in adjacent space with a shared kitchen.
In New Orleans, the owners of the restaurants Cochon and Herbsaint earlier this year added a storefront they call Butcher, where they sell artisanal meats, house-made salumi, sausages and fresh steaks—many of the same ingredients used in their restaurants.
Similarly, the Italian eatery Ruvo Restaurant in Greenlawn, N.Y., added an adjacent market about four years ago offering fresh butchered meats as well as pastas, sauces, desserts, takeout options, and basics like milk, bread, eggs and butter.
In Scottsdale, Ariz., the restaurant Olive & Ivy has a small marketplace where customers can pick up the concept’s signature flatbreads, pastries or gelato.
Meanwhile, in Los Angeles, Joan’s on Third started off as a gourmet market affiliated with a catering company, but has grown into a cafe, as consumers insist on dining in the store.
Operators say the decision to add retail depends largely on the type of space available and the location’s demand for breakfast and/or lunch service.
Adding a market “can be a great complement” to the original concept, says Sam Fox, president and chief executive of Scottsdale-based Fox Restaurant Concepts, which operates Olive & Ivy.
“But,” he adds, “I wouldn’t count on driving a lot of your revenue from that, especially in a restaurant setting.”
At Bottega Louie, the concept’s market, restaurant and bar are designed to work as one, all sharing the central “show kitchen,” where diners can “see the love and the passion” that goes into the food, says Nicole Tilley, director of corporate concierge.
“We have cut out the separation between the front-of-the-house and the back,” she says.
The central kitchen produces everything from the Parisian-style macaroon pastries in the market to the $40 oven-braised osso buco in porcini mushroom broth on the restaurant’s menu.
Bottega, which means “shop” in Italian, has an Italian menu, and Neopolitan pizzas cooked in an 800-degree oven are a house speciality. The space is open for breakfast, lunch and dinner and allows guests to choose whether they want a full-service experience, a quick bite or a meal to go.
“It’s really everything under one roof,” Tilley says.
The concept is owned by a group of private investors under the name Beverly Hills Food Co., and it is the group’s first restaurant concept. Tilley won’t reveal the principals, but the culinary team is reportedly led by chef Sam Marvin, who previously helmed the kitchens at such venues as Piero’s in Las Vegas and the former Le Dome in Los Angeles.
Though Bottega has only been open a few weeks, Tilley says the concept is designed as a potential “lifestyle brand” that could include more locations down the road.
“It’s still growing,” Tilley says. “It’s definitely a work in progress.”
In New Orleans, Stephen Stryjewski, chef and co-owner of the three-year-old restaurant Cochon, says he and his partner, Donald Link, decided to open Butcher in January in a separate space next door.
Stryjewski said the company was already producing its own charcuterie, sausages and specialty meats for both Cochon and sister restaurant Herbsaint, which Link owns.
“It was a natural progression to do them all and sell it retail,” Stryjewski says.
The move harkens back to a time in New Orleans when butcher shops existed on every street corner, he says.
Stryjewski’s modern interpretation, however, is a butcher shop with dine-in space for about 30 to 35 guests.
Customers can buy Cajun boudin sausages, tasso ham or even a whole hog to cook at home, or they can stay and order small-plate dishes, such as lamb merguez sausages in béchamel with gremolata or a duck pastrami sandwich. Most dishes cost less than $10, and wine and beer are available by the glass.
The concept of Butcher was conceived after the 800-square-foot space became available next to Cochon. Stryjewski says it was too small to consider opening another full-service restaurant, but it works as an extension of the meats for which the partners’ restaurants have become known.
Stryjewski says Butcher alone has the potential of reaching $1 million in sales by the end of the year.
“It’s going awesomely well,” he says. “It has been very well-received. It’s getting busier every week.”
Still, Stryjewski warns that a retail operation is a “totally different beast” than a restaurant operation.
“It took us a minute to figure out what people were going to buy,” he says. “Right now, people aren’t buying filets, they’re buying skirt steak.”
At Ruvo Restaurant on New York’s Long Island, co-owner Jimmy DeNicola says he and his brothers decided to open the market next door about four years ago when the tiny space became available and his landlord was looking for a committed lease-holder.
A hole was cut into the kitchen wall to adjoin the two spaces, and the market was born, offering the same sauces, raviolis, breads and fresh meats served in the restaurant.
Customers can pick up Boar’s Head cold cuts, deli salads, fresh produce or frozen dishes, among other items. The retail area has no dine-in space, however.
“There was no market doing what we’re doing in the surrounding area,” says DeNicola. “People have found it convenient. Now, with this economy, when people aren’t going out as much, they can come here and pick up some chicken and some mashed potatoes, and it’s like a home-cooked meal.”
Currently, however, DeNicola says there has been no discussion of adding a similar market to Ruvo’s second location in Port Jefferson, N.Y.
“It’s not possible with the other location,” he says. “We just don’t have the space.”
The “marketplace” at Olive & Ivy was part of the original design because the concept is located in a mixed-use retail and residential area of the Scottsdale Water-front, near several hotels, said Fox, whose company operates 27 restaurants reflecting 11 concepts across Arizona, Colorado, Texas and Kansas.
The marketplace and restaurant have separate entrances, but the retail area makes up about 1,200 square feet of the 9,000-square-foot venue and generates about 10 percent of revenue, Fox says.
The marketplace offers breakfast and lunch, and gelato and coffee are served until 10 p.m. most nights. Customers can pick up pastries, salads, soups, bottles of wine and the concept’s signature flatbreads. Dine-in space is available.
The full-service side, offering an upscale-casual Mediterranean-style menu, is open for lunch and dinner, with brunch on the weekends.
Fox says the concept works for the location because all dayparts are covered.
“We believe the retail side adds a lot of more interesting aspects to the restaurant, more dayparts and more creative stuff,” Fox says.
However, he adds, “people can get a little confused and they ask: ‘Are you a restaurant? Are you retail? Are you a market? Are you a morning component?’ We have gelato and coffee and retail wine. We have a lot going on.”
For operators considering the addition of a retail aspect to their restaurant, Fox recommends starting small.
“For us,” he says, “the restaurant’s so busy, and you spend a lot of energy on the retail side of it, but it doesn’t necessarily generate enough revenue to demand 100 percent of your attention.”
In Los Angeles, Joan’s on Third is the quintessential blend of retail and restaurant, but it was originally designed as a market to complement a catering operation, which first opened in 1995.
Owner Joan McNamara says she never intended for the venture to become a restaurant. That evolution began, however, after McNamara, who operates the company with her two daughters, put a few tables in the market to accommodate guests who wanted to eat on the spot.
Gradually, Joan’s on Third grew into a cafe serving signature omelets, sandwiches and soups amid the shelves of gourmet-food products, cheeses, salami, pastries and desserts.
Most of the cafe business is at breakfast and lunch, McNamara says, but Joan’s recently added hot foods for dinner takeout, such as roast chicken and fingerling potatoes. The market and cafe close at 8 p.m.
McNamara is thrilled to see her cafe customers perusing the market.
“When we started, no one used the wire baskets,” she says. “But now people are using the baskets and actually shopping. I even thought about getting shopping carts, but we don’t have the room.”
While catering sales have slowed somewhat in the current economic climate, McNamara says the market-cafe’s sales have remained steady, and she is currently looking for a second location.
Recently, during a particularly busy lunch hour, a customer suggested that McNamara remove some of the market’s retail shelves, so more tables could be added to better accommodate cafe customers.
“But then we would become something else,” McNamara says. “We need to keep our focus on what we are.”