Martha to be Frozen in Costco

Martha Stewart Living Omnimedia Inc. (New York) will begin producing a line of fresh, refrigerated and frozen foods for Costco Wholesale Corp. (Issaquah, Wash.), the nation’s largest warehouse retailer, next year.

The line is expected to be called Kirkland Signature by Martha Stewart. (Kirkland is the name Costco gives to its in-house products.) Executives at both Martha Stewart Living and Costco said they were still in the testing and tasting phase of their collaboration and had not yet chosen products for the new line.

The deal with Costco was announced at the same time that Martha Stewart reported a net loss of $11.9 million in its first quarter, wider than the $6.8 million loss in the same quarter last year. Although revenue rose 7.4 percent, because of higher advertising income in the company’s magazine division, it was more than offset by costs like investments in Blueprint, a lifestyle magazine introduced last year, and in the marthastewart.com web site, which was recently renovated.

Although Stewart cooks on her syndicated television shows, producing a line of packaged food has not seemed to be part of her image. But ceo Susan Lyne told The New York Times that food is the “greatest untapped opportunity” for the company, the No. 1 area for visits on the company’s web site, which features recipes and cooking tips.

Howard Hochhauser, the company’s cfo, told the Times that Stewart has “a ton of credibility in food,” adding of the new Costco line, “we think this can be pretty big.” He said the company picked Costco because the retailer “really respects [its] employees and customers.”