For any supermarket to compete with a restaurant, a dramatic change in operational procedures can be necessary. Simply offering a menu of restaurant-quality foods is never enough. For instance, you must compete with local restaurants for the highest quality cuts of meat and top brands of seafood. You need to rethink distribution. You should travel to meet with culinary influencers (nationally and internationally) to understand food trends on the horizon. And — this is urgent — you must continually ask customers to rate their experiences at your stores.

“The No. 1 thing we hang our hat on is the customer experience,” says Jenny Mahoney, deli director for Kowalski’s Markets, an 11-store gourmet retailer based in Woodbury, Minnesota. “We invite our customers to give us feedback, and we make our way to the East and West coasts to know what the trends are. With 11 stores, we react quite quickly. We can turn on a dime, create and get to shelf right away.”

It is this type of agility that has served Kowalski’s so favorably in its 34 years in business. The instrumental tipping point for its success came around the time the family-owned company built its first store from the ground up. That was 17 years ago. The store was designed like a European village with a glass-walled bakery oven and three restaurant concepts.

Fast forward to today, and the influence of the restaurant world can be witnessed in every corner of their stores.

“Our stores operate more like a restaurant in our perishables areas,” says Terri Bennis, vice president of fresh food operations for Kowalski’s, noting their deli department receives daily deliveries from US Foods, a leading broadline distributor specializing in the restaurant sector. “It starts with partners and how well you can execute.”

Further, Kowalski’s operates a central kitchen that “feeds” fresh prepared foods to all stores, which receive deliveries six days a week. This guarantees maximum freshness. Roughly 70 percent of the deli prepared foods come from the central Kowalski’s kitchen. 

Jenny Mahoney, Kowalksi's Deli Director

Staff training and consumer feedback are equally instrumental to success in winning the battle to entice the foodservice customer. “Everyone’s been through culinary training that we put on,” Mahoney says, “so they know what they are selling.”

Kowalski’s conducts a training program called “points of distinction” to educate staff on how the gourmet retailer distinguishes itself with products and service. On its website in a section called “Foodie Focus,” Kowalski’s posts trendy topics and offers informative answers for customers on issues ranging for healthy diets to entertaining occasions.

And consumers play a key role in monthly or quarterly strategy meetings in which Kowalski’s invites customers to provide in-person feedback directly to Kowalski’s decision makers. Up to 20 consumers per store regularly participate, and their feedback is critically important. You never know what your customers really want unless you ask them.

“We see customization trending: choose the protein, choose the sauce, and create your own meal,” Mahoney says, pointing to one pivotal trend affecting the supermarket and restaurant landscape in America. It’s happening in pizza and pasta bars, for example, and Kowalski’s addresses this trend with a create-you-own pasta bar, so “our customers can create the way they want it.”

A large sign inside the deli department at Kowalski’s Woodbury store speaks loudly to customers and how they can “Taste the Difference.” Featured signature dishes include Gerber’s rotisserie chicken (slow-cooked Gerber’s Amish Farm chicken), Skuna Bay kalbi salmon (sustainably caught Skuna Bay salmon marinated with Kowalski’s own kalbi sauce) and premium Iowa Pork chops and pork loin roast (natural premium Iowa pork humanely raised in Minnesota and Iowa). Skuna Bay salmon offers a prime example of how to think outside the box and compete with restaurants for premium brands. Kowalski’s visited Skuna Bay in person at its Vancouver Island headquarters in British Columbia, Canada, to learn more about its craft-raised salmon and the benefits of offering this premium brand at Kowalski’s Markets. 

“We took this restaurant program to our deli, and it’s just exploding,” Bennis says.

In other rollouts, Mahoney adds that they are getting ready to introduce flatbread pizzas for the summer, starting with take-and-bake options that are prepared in Kowalski’s own kitchen. “Everybody can have their own favorite,” she says. “It’s that customization that is so important now.”

Related to other emerging retail foodservice trends, Mahoney offers the following insights:

“Poke bowls in the sushi department were introduced three years ago and now it’s just exploding. Timing is everything on when to present new trends. You just have to see what reaction you get and respond accordingly.” 

“Soup is on the rise, and we try to have a nice balance of options on our soup bar, including vegetarian options and hearty fare. These are all our own recipes.”

“Working with local partners is huge for us. We can help them grow, and we give customers a chance to try new things.” A prime example is Deena’s Gourmet Hummus, which started at the St. Paul, MN, Farmers Market and evolved into a successful wholesale business that supplies supermarkets across Minneapolis.

Kowalski’s also works extremely well together within its own perishables departments to execute successful programs. For example, Kowalski’s uses fresh chicken from its own store to grill off a delicious rosemary garlic chicken breast, a No. 1 SKU. 

When asked to sum up how a supermarket convinces any customer that they can measure up to, and exceed, the standards of restaurant food, Mahoney answers succinctly, “It’s always quality first.”

The roots of culinary education

Community involvement plays an ongoing role in educating the public, especially young people, about healthful eating and importance of food in American culture.

Dietitian and nutritionist Sue Moores is Kowalski’s executive director of its Roots for the Home Team program, in which the retailer provides a creative vision for helping young change the food landscape while giving them new tools and opportunities to dream bigger. The 5-year-old program involves projects ranging from urban gardens in downtown Minneapolis where children learn about growing their own fruits and vegetables to creating healthy recipes for salads, which are sold at Target Field, home stadium of the Minnesota Twins.

The history of Kowalski’s

In 1983, Jim Kowalski was working for Red Owl and took note of their store on Grand Avenue that seemed to be underperforming. Together with his wife Mary Anne, their life savings and a loan from a friend, they decided to take a ride down the grocery aisle. In March 1986, they purchased another Red Owl Country Store in White Bear Lake and converted it to a Kowalski’s Market. Then they began the long process of differentiating Kowalski’s Markets from the discounters by adding value to the shopping experience.

A central bakery facility was added in 1991 that could supply their stores with fresh bakery products at a great value. In 1993, the Kowalskis built a franchised Cub Foods store in White Bear Township that would assure purchasing power throughout all their stores. But Jim and Mary Anne knew they could never differentiate themselves in the grocery aisle. In distinguishing themselves, Kowalski’s was becoming the store where shoppers found the unusual or new product.

In August 2000, the Kowalskis’ vision for what a grocery store could be was unveiled in Woodbury. It was the first Kowalski’s Market built from the ground up. Designed to look like a European village, it featured a glass-walled bakery oven, three restaurant concepts, a department store-quality gift shop, an educational and meeting area, a full service JUUT Salonspa, and a Natural Path department offering organic and natural foods and homeopathic remedies. People waited in line to see it. Grocery industry people came from all over the world to see it. It was heralded as the next level in grocery stores around the world.

In April 2002, Jim and Mary Anne bought a small chain in the Minneapolis area known as GJ’s Supervalu, from lifelong friends John and Carol Vranicar. Once again, what was now becoming Kowalski’s signature European market theme was executed in the remodeling of these stores. Each of the stores opened to rave reviews from excited customers. On February 23, 2004, Kowalski’s Markets expanded to the Minneapolis suburbs with the acquisition of Driskill’s New Market in Eden Prairie. Remodeling was completed in November of 2004. In June of 2005, the Kowalskis opened a market in Stillwater/Oak Park Heights. In November 2008, Jim and Mary Anne built from the ground up a store in Eagan on Diffley Road.

In July 2015, Mary Anne Kowalski along with daughter Kris Kowalski-Christiansen opened their first store together in historic downtown Excelsior. The store is located a few blocks off Lake Minnetonka on Water Street in the old Mason Motors building. On November 10, 2016, Kowalski’s opened the 11th store in the city of Shoreview, modeled after the Excelsior store and the recently renovated Grand Ave. store. The building was an old Rainbow Foods. It now also houses the central facility which includes the central bakery, commissary kitchen, meat production facility and the transportation facility. At present, there are now 11 Kowalski’s Markets in the Minneapolis-St. Paul area.