How one coffee brand keeps profits brewing by using a central kitchen
By Elliot Hool, CMO, SimpleOrder
Restaurants are becoming increasingly more expensive to operate. That, paired with fierce competition flooding the marketplace, consumer demand for the latest technology and surging real estate costs have led fast casual operators to start looking for ways to cut costs. As a result, many have turned to the central kitchen system.
The system is a centralized facility that has the capability to supply goods for multiple locations. Some fast casual chains or multi-unit groups choose not to purchase items like baked goods through external suppliers and opt to produce these items in-house at one facility. Once prepared, the brands will distribute them to all of their locations through the central kitchen.
Let's take Coffee Surf for example, a New Jersey-based coffee concept that has both individual store locations and supplies locations across the state. Coffee Surf utilizes a central kitchen, where it stores coffee grounds, beans and cans of cold-brewed coffee. When inventory at a particular location runs low, employees request pre-stocked inventory to be shipped from the central kitchen to the store — reducing shipping time and allowing Coffee Surf and its partners to require less stock space for the smaller amount of inventory.
These facilities have also become common with cold-pressed juice companies that have their own stores and juice bars but also sell to other businesses like gyms, restaurants and markets. With a centralized location, they can act as both an external supplier and as part of the restaurant's internal business.
The idea of a central kitchen has become a larger part of the conversation for a number of reasons. For starters, central kitchens reduce the need for a bigger retail footprint. Let's say a restaurant group that serves fresh baked bread to their customers requires a bulky convection oven to bake enough loaves for a full day. That oven alone might cause the location to require extra square footage. By implementing a central kitchen and baking bread out of one location to supply all of the restaurants, operators don't have to spend money on the extra retail space.
It also helps with quality control. Once a concept chooses to grow and scale — consistency is vital. Having a single space where everything is produced at the same time using the same equipment can practically guarantee a more consistent and higher quality product. Central kitchens give operators a chance to better control their costs, their inventory and the amount of time it takes for a delivery.
The key factor in making this concept work for your restaurant group is communication. By finding a central kitchen system that accommodates both the supplier side and the restaurant side, operators can streamline the communication process and make the ordering and delivery process seamless between their different branches.
As technology continues to revolutionize the fast casual industry, isn't it time to make technology a more strategic part of your operations? Central kitchens are a scalable solution to cut costs and help operators better manage their inventory.
Cover photo: iStock