How Many Gluten Free Stores Have Failed?

[MrJibbs]

Hi everyone, I'm new to the boards. I've been with my girlfriend, who has celiac, for a little over a year and still going strong. I didn't have a clue what celiac disease was before i met her, and after being with her i feel that there is so much more that can be offered in our area of residence to cater to the gluten-free, dairy-free, vegetarian, vegan, and all of the other food-allergies/lifestyle-choices that there are. I live in Colorado Springs, CO, and there is a few Whole Foods, and other specialty stores that offer gluten free food, but not on the level that is possible. I'm just entertaining the idea of opening a new store, and trying to get a feel for the market, so i just want to know if anyone has seen their local independent gluten free market fail for any reason. Any help would be appreciated.

Thank you in advance,

MrJibbs

[tkm831]

There is defintely more awareness of the disease in the NY area but I would welcome and establishment where I knew I could shop without thinking so hard about whether I could eat it, provided it was not too overpriced. I know they just opened up a Gluten Free bakery a few miles away from me and I cannot wait to try it. Good luck it if you decide to go for it.

[tkm831]

There is defintely more awareness of the disease in the NY area but I would welcome and establishment where I knew I could shop without thinking so hard about whether I could eat it, provided it was not too overpriced. I know they just opened up a Gluten Free bakery a few miles away from me and I cannot wait to try it. Good luck it if you decide to go for it.

[tarnalberry]

At least a couple in SoCal and the Seattle area have failed. If you're strictly gluten free, you seriously limit the population that will come to you, so it is a tough business case. But there are also a number of stores around here that have mentioned having particularly well trained staff, and not being *strictly* gluten free (they might cater to a subset of niches, not just one), and a good location, that has helped them develop a community support system.

[MrJibbs]

Thanks for the replies. I agree that it would be hard to keep a business going if it were only to sell gluten free items. I was thinking of having some of the mainstream brands that don't necessarily say gluten free but are. Maybe have every item color coded to show what its free of. I don't know of the legal ramifications i could face if i say something is gluten free, and then someone somehow gets sick. And like i said before i want to have a wide selection of other items that aren't necessarily gluten free but free from other main allergy groups. The gluten free market is only going to get bigger as far as i can tell so the sooner the better. Another question for you awesome people. When you do go to your gluten free market, what are you minor gripes? Be it selection, layout, staff, etc.

Thanks again,

Jibbs

[happygirl]

You may want to talk to stores that ARE in business:

www.glutenfreesource.com (PA)

www.navanfoods.com (VA)

also, Second Storehouse in VA.

[DarkIvy]

Being in Colorado Springs, you may have heard of Deby's Gluten Free in Denver.

They've been pretty successful, and I think they've been around for more than a few years. I remember when a good 7 years ago or so my grandma (who lived in another state) ordered their bread by mail because she liked it so much.

Part of the reason for their success, while it's not hugely popular, is that they keep it pretty simple. They operate out of a warehouse (basically!) where the front end was converted into a small grocery and restaurant. This kept their costs down. They sell a lot of gluten-free basics. They've got some pasta, some flour... then they've got a refrigerator with breads (all kinds of gluten-free breads. it's amazing!) muffins, and single servings of cakes. They've got a freezer case with pizzas, other desserts, and frozen dinners that they package themselves. They've got a knowledgeable, friendly staff, and they do mark all other major allergens on their packaging.

Recently, they've expanded somewhat and they sell some of their frozen breads and doughs to many different Colorado King Soopers stores. They sell this under the name "8 Free Foods".

They were able to open in a central metro area and find a wide enough customer base to stay alive. Also, they don't stay open later at night, I think to cut operating costs. Most nights they're closed by 8 or earlier. A lot of GFers like to eat lunch at their restaurant, and they take a friend or two from work. I think this probably helps boost business a lot. Their meals are actually pretty good, though most of it's very "down home" style.

If you were to open something like this, I would really try and get a feel for the alternative diet market in Colorado Springs. You could potentially do a store type of thing where have a substantial section marked off as just gluten-free, but then you could also offer non gluten-free foods that are vegan, veggie, or other allergen free. Some of the product lines actually overlap. You could do this and have your own bakery or small kitchen, but have everything made in the store strictly gluten free. If you could offer a large selection of vegan/raw/whatever else food that stores like Whole Foods don't even carry, WHILE having a small gluten-free kitchen and/or bakery, you could potentially corner a larger part of the market in Colorado Springs. This might be ideal on several levels: one, you wouldn't have to deal with gluten cross contamination from other parts of the store the other foods you carried were premade and prepackaged goods from other manufacturers, and you could have a totally gluten-free kitchen. If you also offered some gluten-free veggie and allergen free options, you might attract enough attention that shoppers already there might be inclined to stop and have lunch (much like Whole Foods, except smaller and gluten-free).

Alternatively, you could do a smaller, strictly gluten-free operation.

EIther way, I'd advertise like crazy. Small business often underestimate the power of good advertisement. Yes it's expensive, but it's probably one of the best investments you can possibly make in any business. If people don't know your product is out there, they're not going to come to your store. Whatever you do it needs to be appropriate to the market. If you end up encompassing a large variety of alternative diets, you will really have to set yourself apart from the Whole Foods idea. By that I mean, you will have to have to carry MORE products and product lines than Whole Foods does. You need to differentiate yourself enough that you have enough options to satisfy all of these customers. Your selection has to be different and big enough to attract people who are already AT Whole Foods. They're not going to make the drive to see the same junk plus maybe two or three extra items already sold at Whole Foods, because they probably shop there anyway for produce and meat and whatever else. You need to set yourself apart enough that people think "okay, I'll get my produce and meat and hygiene products at Whole Foods/King Soopers/Safeway, then I'll drive out to this other store because they have the best selection of vegan/allergen free/gluten-free breads and snacks."

Once you've got the best selection, you can advertise yourself that way. For a just gluten-free store, show up at support group meetings and let them know. Tack fliers up in places like libraries or student centers (trust me, there are more gluten-free students than you might think. And we want options. Desperately.) Wherever you can. Put up small advertisements in newspapers and local magazines. If someone notices this, even if they themselves are not gluten-free, if they know someone who is, believe me, they'll go to that person and say "gee, I saw this ad in the paper for this new gluten-free store. Have you heard about it?"

This is absolutely invaluable to you as a store owner. It happens a lot. In my personal experience, I've had friends notice "gluten-free menu on request" at various restaurants or gluten-free sections of certain grocery stores and then come running back to me to let me know that I can now eat at x and y restaurants. I never would have gone in on my own to notice, but my friends and family who are aware of my condition DO notice and spread the word. The more you advertise it, the stronger customer base you'll get.

Also, rather than focusing on why small businesses fail (and there are many reasons! most DO fail, gluten-free or not), try and get as much info as possible on why they succeed.

[MrJibbs]

Wow! DarkIvy you got it. Thanks for the time you spent writing that and the good advice. I would love to do the bakery idea, but we already have one here thats been around since like '84, so i think it would be hard to capture that customer base. It would be nice if i could set up shop near them and maybe have a business deal or something, so that the people that are already going to buy these people's bakery items can just walk down the street (or next door) and get the rest of the items that they need. That way i wouldn't be competing with them but have a sort of symbiotic relationship with them so that both our businesses could grow even further. I would like to have a large raw food diet selection, because I know some of the customers will have villi damage and the raw food contains massive amounts of nutrients that can get removed when cooked.

The reason i ask why the businesses fail is because great new ideas are born from failure, and if you can learn from someone else's failure even better. Since the successful business's are still open i can always go and talk to them, and i plan on it, but finding out how others failed is a little bit more tricky. So finding out what happened i can adapt my business plan so that i don't make the same mistake. Ive got my work cut out for me and knowing both sides of the story is the only way to be successful.

Thanks,

MrJibbs

[Cherry Tart]

Hello!

There's a tiny healthfood store by me, in Southern California, called Vitamin City (not affiliated w/ the chain) that caters to several different food issues (lactose, soy, nut-free, sugar-free), however, the emphasis is on vegetarian, organic, and gluten free products. They have two giant sections (one dry goods, the other frozen) dedicated to gluten free and the prices are great (usually 20 - 30% less than Whole Foods & Sprouts). They also carry small brands I can't get at main stream stores. An added plus is that they offer organic veggies/fruit twice a week from local growers. That way they don't have a lot of waste by maintaining a daily produce section. Most of the produce usually sells out in a couple of days. They offer special orders for Shelton Farms free range turkeys during the holidays. In addition, they carry a good variety of vitamins and small organic beauty section. It's a tiny store, but it packs quite a punch. I do the majority of my shopping there. V.C. has been around for years. They are a fine example that one can own a tiny store and still have a successful business.

As for pros/cons from the consumer....

Cons:

* the cost is usually high for gluten-free products

* most stores will often carry only one or two items from a gluten-free company that offers countless products

* things often sell out and are not quickly replaced

* most stores are afraid to venture out and try smaller brands or local gluten-free bakers

Pros:

* stores are slowly becoming more educated on gluten-free products

* stores that stock products based on consumer opinion/request (Ask your customers for their favorite brands...some products are terrible and expensive - save yourself the hassle and money, poll the consumers)

* having a selection of other products to choose from than just gluten-free (ie. organic, dairy free)

Good luck to you!!!

[MrJibbs]

Thanks for the reply Cherry Tart. I think that's the business model that i want to focus on. I would love to have produce, but when i start out i have to keep waste to a minimum, and that is a perfect idea to offer more selection and still be cost effective. Obviously i want to put the customer first and polling them is great idea, maybe i could take it a step further and emphasize custom ordering. That would help tons, especially in the beginning, to keep the customer coming back. Ive just got so many ideas going through my brain that i'm having trouble keeping them organized. Like, I would love to make a place that people could go on a date. I think that's what made me really want to do this. Yeah most restaurants around here have a gluten free "menu", but its things like salad with only one dressing to chose from, or boiled chicken with no spices, really dull and boring food. It would have been awesome if there was a place that she could be excited about going to and it was a place where she could feel safe from cross contamination. So maybe have a deli section or something. But i think im getting ahead of myself.

[celiac-mommy]

We live in the Portland OR/Vancouver WA area and we have a gluten-free store: lingonberriesmarket.com They try to keep their costs below Whole Foods, I love it-you don't have to think about anything (as long as it's just a gluten allergy)

[Mtndog]

I live north of Boston and we have one called My Low carb Life. It caters to both celiac and low carb diets. At first, they didn't have great products but they upped their selection and they are doing great. It's in Peabody or Danvers, MA if you want to contact them. It's run by a family whose son has celiac and Down's syndrome.

[Michelle1234]

There was one in Erie Colorado that opened then closed. I don't know if they failed or just closed up shop. They seemed to be an extension of Deby's. Unfortunately they had really limited hours so I never went there. Although I would love a totally gluten free store/restaurant near me I must confess I don't make the 45 min. drive to Deby's that often. I will go there if I'm in the area though. The other thing that may make getting into the CO market difficult at this time is that King Soopers has really expanded their gluten free food offerings. With Udi's in the bread market and being carried by King Sooper I find that they are my main grocery store right now. The reason I say right now is that the last time I went they had dropped one of my staples, Applegate Farms turkey slices, for lack of others buying them. I've pretty much dropped Whole Foods completely since they aren't price competitive and their selection isn't that good. My shopping is divided between King Sooper and Vitamin Cottage which remains the standout grocery store for me due to their excellent selection and low prices. I probably would eat at Deby's at least once a week if they were 10-15 minutes away.

Good luck! Maybe Deby's would allow the failed Erie owners to contact you to discuss why they went out of business.

Best,

Michelle

[DarkIvy]

There was one in Erie Colorado that opened then closed. I don't know if they failed or just closed up shop. They seemed to be an extension of Deby's. Unfortunately they had really limited hours so I never went there. Although I would love a totally gluten free store/restaurant near me I must confess I don't make the 45 min. drive to Deby's that often. I will go there if I'm in the area though. The other thing that may make getting into the CO market difficult at this time is that King Soopers has really expanded their gluten free food offerings. With Udi's in the bread market and being carried by King Sooper I find that they are my main grocery store right now. The reason I say right now is that the last time I went they had dropped one of my staples, Applegate Farms turkey slices, for lack of others buying them. I've pretty much dropped Whole Foods completely since they aren't price competitive and their selection isn't that good. My shopping is divided between King Sooper and Vitamin Cottage which remains the standout grocery store for me due to their excellent selection and low prices. I probably would eat at Deby's at least once a week if they were 10-15 minutes away.

Good luck! Maybe Deby's would allow the failed Erie owners to contact you to discuss why they went out of business.

Best,

Michelle

I have to admit, also being in colorado, I'm much the same way. I LOVE that King Soopers does have a pretty big selection, and they're right across the street from me. Convenience is huge. I also go to Vitamin Cottage far more than Whole Foods. I think the atmosphere is more personal and I get sick of the crowds (and ridiculous prices) of Whole Foods. Ironically, in Boulder, they're right next door to each other haha. What I DO go to WF for is for their house brand gluten-free baking mixes. They're the best I've tired and for a very reasonable price.

Living as far away from Deby's as I do, I RARELY go there. It's just not worth the drive. I like them a lot, though. My boyfriend's family lives about 10 minutes away from them though, so when I'm there I go there a lot.

MrJibbs, I LOVE your idea to maybe share the area with another bakery, but not compete. I know for me, having to hit up multiple stores is a pain, but when they're all close, it's not as big of a deal. Even though I rarely go to WF anymore, the times I do go anymore it's when I'm already in the area at Vitamin Cottage and Target. And your welcome for the post... I'm interested in marketing so I tend to go overboard when people ask related questions. I LOVE that stuff.

Also, it's nice that you are so supportive of your gluten-free. We gluten-free gfs love it.

[Juliebove]

My health food store is owned by a celiac and they advertise as "Your gluten-free Headquarters". They don't sell fresh produce, but they are a drop point for weekly boxes from a local CSA. They do cater to everyone and will order anything they can for you. I get my rice cheese there and also some coconut yogurt. Although they do prefer to have foods that are healthy and free of sugar and stuff like that, they will special order. Best of all, their prices are cheap compared with the other stores around here.

[ang1e0251]

I'll add my opinion. We don't have any bakeries or gluten-free restaurants in our area but that would be so nice. Having read so many students complain about their limited choices, I think opening up near a university would be a natural. Also in our state I read of many parents filing for special statis for their celiac children. The school is then required to provide special lunches. The way I understand it works is that an employee is assigned to buy their food requirements & prepare it for them every day. What if you approached the schools to win the contract to provide those meals for them? I'll bet that would be a big foot in the door. Locally owned restaurants also might be interested in prepackaged meals if they felt enough customers wanted them. I would eat there if I could be sure the food had been prepared in a gluten-free facility.

Also I have been toying with the idea of food prep. In South Bend there is a business where you can go in and put together whole meals for your family. They do all the prep and you do all the actual mixing of the recipes at their facility. You leave with a week's worth of dinners for your family without the shopping or chopping. When my family's schedule was especially busy, I did once a month cooking. All the dinners were prepared and frozen for month with just heat & serve instructions attached. It saved a lot of time. I was thinking when we get our support group going it could be fun to get together and do that kind of meal prep. Some folks who are new to it would welcome the help and it would save time for everyone. Why couldn't you offer that service in your business? Especially college students learning about their diet might love classes like that.

One more thing, when I lived in AZ our friends opened a farmer's market. I sold cotton candy to them and since it is perishable, our deal was that I would take back any bags that shrunk down too much. THat way they only paid for what they sold. You could sell your local produce on that basis that way you'd cut down on shrinkage and they would have a place to sell.