The first question independent natural products retailers often ask when considering adding prepared foodservice is: How much space will we need to do this? In reality, however, that’s a lot like asking a dentist for a quick diagnosis for a toothache over the phone. You really need to drill down a few important factors in order to determine your space needs.
First thing’s first
The term foodservice covers a wide spectrum of items and possibilities. As the lines blur between quick-service restaurants, grocery stores and convenience stores, prepared foods take on many different meanings now, and there are more options to contemplate than just a few years ago. That said, the first serious consideration for retailers like you is what kind of foodservice you want to offer. This all-important initial decision affects space and so much more: the square footage you’ll need for actually preparing the food and for merchandising space, as well as the cost of equipment, labor, goods, insurance and every other imaginable budget line, including marketing.
So think long and hard about how much foodservice you’d like add and how to fit it all into your single store or handful of locations:
- How much physical space can you dedicate to this endeavor?
- What’s your buildout budget for equipment, refrigeration and (if needed) ventilation?
- What are your financial expectations for your foodservice operation?
- Will offering prepared food increase your customer base enough to warrant the impending deluge of operations?
- Do you have skilled staff who, ideally, you would like to create your menu offerings in-house? Or would it make more sense to outsource production and simply resell these items?
Let’s look at the various food categories available and how comprehensive a program you’d need to be able to knock out each. In my opinion, the best baseline foodservice you might consider implementing would include very simple offerings such as soups and sandwiches. You can also add composed salad dishes like potato, coleslaw, pasta and green salads. You can even climb up a level and offer salads that feature grains, marinated vegetables, goat cheese, dried fruit and other more interesting, alluring ingredients. All of these “cold kitchen” items can be produced in a very simple kitchen with no ventilation or cooking equipment.
Once you start cooking foods and applying heat to your kitchen, your space needs and equipment expenses will increase significantly. But before you procure equipment and incur design costs, also consider “incubator kitchens,” which have become more available and popular in recent years. These small kitchens, usually shared by caterers and food truck owners, provide a professional kitchen space in which to prepare menu items for retail. In today’s market, you can either rent one for your production or hire a small, independent contractor to produce foods for you in an incubator kitchen. This way, everything can be done off-site. Going this route usually ensures consistency, but the margins are much less and you’ll likely have less control over ingredient quality and integrity. You also can’t make “made in-house” claims.
Back to space
Let’s add one more layer to the subject of space needs. So far, we’ve discussed offering items that are chilled or mostly assembled versus prepared in ovens, steamers, grills, fryers and other cooking equipment. If you decide to offer cooked foods—your own turkey breast, for example, you’ll need ovens. So in that case, not only do your space requirements go up, but your costs skyrocket, since most cooking equipment must be installed under a very expensive ventilation hood system. These can cost $1,000 per running foot.
This is why, if you want to get your feet wet in foodservice, I believe smaller, well run and less complicated are always better goals than going bigger and tackling items that are more difficult to pull off. Never create something you can’t execute—and execute excellently—24/7.
Even if you craft chilled food in-house, you’ll need ample refrigeration: a large walk-in cooler in the food-prep area for all of your raw materials and backup finished product, plus enough linear footage for refrigeration on the retail floor so shoppers will see your completed creations. If this is the direction you decide to go, you’ll also need plenty of table workspace to compose salads, sandwiches or platters. And as for merchandising cases to display your menu, you can either purchase these used or have them custom made—yet again a huge spectrum to ponder.
When assessing your space, look at it in tiers, much like you view other aspects of your business.
Tier A: Keep it simple. Offer outsourced soups and just make great sandwiches in-house. You can do this least expensively and within 200 square feet. This route requires no ventilation or costly equipment, but you need plenty of refrigeration and table space.
Tier B: Bring it up a notch. Add a few nicer sandwiches and salads. Maybe offer a few more green salads and side salads. You can accomplish this with pretty much the same Tier A footprint and expenses.
Tier C: Commit to cooking. Investments include expensive ventilation and cooking equipment, and you must have skilled employees on your team who can operate it all. Equipment investment alone can run several hundred thousand dollars and require at least 800 square feet for a small independent store
As long as you’ve considered all the possibilities—and you have a vision—you’ll be prepped for the project at hand and can make it a reality. Most importantly, you should be able to make it a success.
Chef Steven Petusevsky is the author of The Whole Foods Market Cookbook – a Guide to Natural Foods with 350 Recipes (Clarkson Potter, 2002). He works as a culinary resource for several companies, can often be found squeezing fresh, seasonal fruits and vegetables in produce sections and will travel long distances for the perfect meal.