Inside the new Whole Foods: Restaurants, bars, a coffee bar and, yes, groceries

J.J. Kedra, of local 98 electricians, make adjustments to a sign at the new Whole Foods store, located at 2101 Pennsylvania Ave, in Philadelphia, Thursday, Oct. 13, 2016.

Two bars, a high-tech coffee bar, a juice bar, four food stands operated by Philadelphia restaurateurs  - and groceries - are the draws at the new Whole Foods store which opened Friday, Oct. 14 at 2101 Pennsylvania Avenue, just off the Parkway and behind the Rodin Museum.

It's a two-block move for the store formerly at 20th and Callowhill Streets, which opened in January 1997.  The new store, at 62,000 square feet nearly double the size, is set on a property that previously housed a Best Western hotel.  The Callowhill store closed Wednesday, and all remaining food was donated to three charities.

Whole Foods is billing this store as the flagship for the mid-Atlantic region, and it opens as the company, founded in 1978 in Austin, Texas, is trying to find its way in a now-crowded marketplace for natural and organic foods.

The chain seems to be banking on prepared foods, an obvious profit center. In addition to its own prepared foods, Whole Foods has contracted with four Philadelphia-area food companies to set up luncheonette-style counters equipped with bar stools.

CHeU Noodle Bar's chef Ben Puchowitz and business partner Shawn Darragh (who also have Bing Bing Dim Sum and another CHeU planned for this winter in Fishtown) are selling pepperoni pork dumplings, black garlic wings, miso ramen, mushroom yakisoba, and coconut curry noodles at this branch of their Washington Square West bar.

Severino Cucina Rustica is a spinoff of the 45-year-old Westmont pasta company, and chef Marc BrownGold sells plates of $11 and $12 pasta plus Italian sandwiches, salads, and desserts.

Dizengoff has chef Michael Solomonov and Steven Cook (Zahav and Abe Fisher) selling hummus and pita in this offshoot of their Center City and New York City hummusiyas.

At Wiz Kid, Vedge chef/owners Rich Landau and Kate Jacoby are selling a few vegan sandwiches, salads, and fries. Wiz Kid also will open as a shop next door to the couple's V Street restaurant near Rittenhouse Square this winter.  

Besides the seating at each counter, the food hall has picnic-style bench seating for 140 people. The food hall is adjacent to the main bar, which serves cocktails, nearly 40 beers available (16 on tap), and wine.  Another drinking option is a cocktail cart for people sitting at the venue counters. They can go to the full bar for draft beer, but can also order cocktails, beer by the can/bottle, and wine by the glass from the cart.

The new store's coffee bar lining the front window along Pennsylvania Avenue will open daily at 6 a.m., an hour before the store does. There probably will not be a line for pour-over coffees, despite its lengthy prep method; the store has a robot that can prepare five at once. At 11 a.m., the counter adds wine, beer, and coffee cocktails.

Cheeses, organized by style (Goudas next to Alpines, soft-ripened next to blues), have their own room. Cooking is done in truly open kitchens; there are no counters between cooks and customers. The fish counter, while not self-service, allows customers to walk up to a salmon for close inspection. A meat room behind glass allows people to observe whole-animal cutting and drying. There's a cart for soft pretzels. 

The non-food offerings are twice as abundant as they were in the old store. It's hard to pass the boldly scented Vellum Street soap display among the beauty aids without stopping to sniff.

Whole Foods knows Wall Street is watching. Analysts have been tepid lately about the retailer, whose share price has dipped 13 percent over the last year.

"Fifteen years ago, they built this" market segment, said Brian Yarbrough, a consumer-research analyst with Edward D. Jones & Co. in St. Louis, who tracks the industry. "The proliferation of competition is exploding." 

"What you're seeing in [the sector of] natural foods and organics are double-digit growths every year, while the rest of grocery industry is 1, 2, or 3 percent," Yarbrough said.

Besides smaller rivals such as Fresh Market, conventional supermarkets, and even big retailers such as Costco, Walmart, and Target are stocking organics and more heathful foods - though there's not much of a customer overlap. 

"Other people have caught up with them," said Jeff Metzger, publisher of Food Trade News. 

Like Yarbrough, Metzger believes that Whole Foods' long-term prospects are sound. Still, Metzger said the company could not "override the whole `Whole Paycheck' image" and said that perception was an impediment to faster growth.

The company recently launched smaller stores in a few cities, branded as 365 by Whole Foods, in an attempt to woo less-affluent shoppers.

Emily M. Moscato,  a professor of food marketing at St. Joseph's University, said the larger, fancier store has the potential for commensurately higher sales.

"Whenever we go food shopping, people have a mental list, a mental budget, of what they have to spend," she said. "We always have a cushion beyond what we have to put in the cart. Beautiful aesthetics and smells - those are what captivate us and increase our mental budget."

"Bars are a great idea," said Moscato, tongue in cheek. "Get people a little bit tipsy and they'll spend more money."