Intalytics Commentary: The Dean & Deluca Bankruptcy

The venerable New York food emporium Dean & Deluca filed for bankruptcy in late March 2020, one year after shuttering all of its U.S. stores. It is somewhat ironic that their bankruptcy filing coincides with the greatest boon ever experienced by U.S. supermarkets, but their fate was sealed long before the first coronavirus case was documented. Dean & Deluca opened its first store in Soho in 1977, and developed a cult following. I can still remember my first visit to Dean & Deluca – I was mesmerized by the selection, and wanted to sample and buy almost everything in the store. (It didn’t help that I was hungry at the time – the old adage that you should never shop for food when hungry had particular meaning when visiting Dean & Deluca).

The company’s Asian owners have re-invented Dean & Deluca as a food service operation, with a focus on coffee, smoothies, and light snacks. Even if they are successful in re-introducing the concept in the U.S., it will be a shadow of its former self.

Perhaps the most disappointing aspect of Dean & Deluca’s demise is that the core business remains every bit as relevant now as when they started. While many of the products offered by Dean & Deluca are more widely available today than they were 40 years ago, the concept is still relevant in the right trade areas. Dean & Deluca’s market expansion was scattershot, with Charlotte, NC representing their first new market outside of New York City.  While Charlotte is a great market for many operators, there are many more differences than there are similarities between Manhattan and Charlotte consumers.

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