Bartolotta cooks up kitchen for Kohl’s

October 25, 2016

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Rick Romell
Milwaukee Journal Sentinel
http://www.jsonline.com/story/money/2016/10/20/bartolotta-cooks-up-kitchen-kohls/92418108/

Menomonee Falls — For Bartolotta Restaurant Group, it’s an opportunity to branch further into a promising business area.

For Kohl’s Corp., it’s a shiny amenity to help in the quest to attract and retain good people.

And for Jason Wessels, the new dining area and kitchen his employer unveiled this week — a huge space that combines industrial-chic design with around-the-world food prep stations — is more than acceptable.

“This is amazing,” Wessels, who directs the big retailer’s shopper loyalty program, said as he got his first glimpse of the 32,000-square-foot area at corporate headquarters that Kohl’s has dubbed “The Kitch.”

“Like, amazing….It’s unbelievable.”

Following the lead of companies such as Silicon Valley tech firms that compete ferociously for talent, Kohl’s is wagering on the notion that one way to an employee’s heart is through his — or her — stomach.

“Corporations, particularly financial and high tech, where attracting and retaining high-skilled employees is very important, have seriously upgraded the quality of the meal services that they provide,” said Thomas MacDermott, owner of New Hampshire-based Clarion Group, a food service consultant.

Kohl’s isn’t Google. But for a department store retailer beset by stalled growth, changing consumer preferences and the ever-looming, Godzilla-like threat of Amazon, anything that helps bring in and hold smart employees may well be a smart bet.

“We knew we needed to elevate the quality,” chief administrative officer Richard Schepp said.

So, out with an in-house dining setup Schepp described with faint praise, saying it had been “OK” and “a decent cafeteria experience.”

In with a sleek, contemporary dining hall and such fare as Neapolitan pizzas, freshly prepared sushi, and specialty salads (beet and goat cheese; spelt and roasted squash with maple dressing) from a kitchen run by Bartolotta, which owns several highly regarded and popular restaurants in the area.

Just a little over five years ago, Kohl’s was cooking its own food at its 5,000-employee headquarters and, according to Schepp, not very well.

Now it has signed up with one of Milwaukee’s premier restaurant operators, outfitted a completely new kitchen and built a dining area that offers a wide range of collaborative gathering spaces and private nooks.

It’s a spot away from cubicles and offices that’s meant to be used all day, full of power outlets and USB ports but free of Kohl’s branding and even any references to the company’s “Greatness Agenda.”

“You feel like you left the building,” Schepp said.

Kohl’s won’t say what it spent, but turning a warren of cubicles into a dining area that can seat 750, a kitchen the size of a mini-mansion and a barista bar to boot isn’t cheap.

“This is all brand new,” Bartolotta group co-owner Joe Bartolotta said as he showed off the space. “…We gutted everything. We tore out the ceilings. We tore out everything. It was a very sizable investment.”

Whatever Kohl’s spent, it appears the company can recoup a small part of the expense through an agreement with the state that gives the firm tax credits in exchange for capital investments.

The deal was struck in July 2012, when the company planned to build a new, $250 million corporate campus a few miles from its present location. Kohl’s abandoned the plans 17 months later in favor of a less-expensive expansion at its current site. The $137 million in capital investment the company made there through last year, however, have helped it earn $18.3 million in state tax credits under the agreement.

The corporate impulse to amp up in-house dining isn’t broad, but rather is concentrated in sectors such as tech, said Mike Buzalka, executive features editor of trade journal Food Management.

But he said upgrades make sense for companies that, like Kohl’s, are situated where there are few nearby dining options.

It’s unusual for a firm to hire a restaurant operator, rather than a food-service contractor, to run its kitchen, Buzalka said.

Joe Bartolotta, however, sees the venture as a way to diversify. His 1,000-employee company has 11 restaurants, including highly regarded spots such as Lake Park Bistro and Bacchus.

But opening stand-alone restaurants is costly, and Bartolotta has been looking increasingly at opportunities to run places without the big capital investment. The firm operates four restaurants at Wauwatosa’s Mayfair Collection, for example, that are owned by the shopping center’s developer.

Two years ago, Bartolotta took over the food court at the U.S. Bank Center and opened what it calls the Downtown Kitchen. That operation impressed Kohl’s executives and paved the way for creation of The Kitch.

Profit margins on such businesses are lower than at a typical Bartolotta restaurant, but with a minimal upfront investment and an all-but-captive market of 5,000 potential diners, it’s an attractive proposition, Joe Bartolotta said.

That thinking makes sense, suggested Darren Tristano, president of Chicago-based food industry research firm Technomic Inc.

“When we look at the full-service space where Bartolotta operates, the high end is doing OK, but there aren’t a lot of growth opportunities for new restaurants,” Tristano said.

John Wise, operations director and managing partner at Bartolotta, said Downtown Kitchen serves about 500 people for breakfast and 1,500 to 2,000 at lunch. He expects the numbers at Kohl’s to be bigger.

Wessels, meanwhile, expects the new space to be about more than food. He believes it will bring colleagues together and spur beneficial collaboration.

Many people, Wessels said, regard the kitchen as the heart of their home.

“This is really going to become the heart of our office,” he said.


How is it possible that bacon sausages didn’t exist until he invented them?

September 26, 2016

2016-09-26_1045

By PETER FROST

http://www.chicagobusiness.com/article/20160922/ISSUE01/160929995/how-is-it-possible-that-bacon-sausages-didnt-exist-until-he-invented-them

On a whim in 2008, Lance Avery hopped a quick flight to Des Moines to check out the inaugural Blue Ribbon Bacon Festival, a small event that drew about 200 bacon enthusiasts to a local bar. He remembers seeing men dressed in bacon suits and others with pieces of bacon stuck to their faces and thinking, “These are my people.”

Avery is finding that “his people” are all over the place today. The Des Moines bacon festival? It was held earlier this year in the city’s convention center and hosted 14,000 fans from 42 states and seven countries. As for Avery, the former corporate chef now runs Big Fork Brands, a line of all-natural, antibiotic-free, naturally encased sausages made primarily with bacon that he introduced at the 2011 festival.

Big Fork Brands, which consists of Avery and a single sales manager, had total sales of about $500,000 in 2015 and is on pace to do about $800,000 in 2016 after landing placement in the refrigerated shelves of Whole Foods and Costco stores in Illinois over the past few months. Its annual run rate just surpassed $1 million in its most recent financial quarter. He thinks the Big Fork brand can be worth $15 million to $20 million by 2020.

“Right now, we have more leads than we can deal with,” says Avery, 41, who quit his day job as a food consultant in January to focus on Big Fork full time. “We’ve got to be smart and strategic about how we position the brand and where we go from here.”

Funded with about $300,000 of Avery’s own money plus a small bank loan (that was recently paid off), Big Fork is now distributed in about 15 states both at retail and through food-service channels. Available in eight varieties, including aged cheddar, maple and brown sugar, and best-seller hickory and applewood, Avery’s bacon sausages can be found in grocers such as Plum Market and restaurants like Tavern on Rush. They retail for $6.99 to $7.99 for a 12-ounce package of four links.

He’s now trying to take his startup to a national platform. To get there, Avery knows he’s going to need help. That may mean partnering with a bigger manufacturer that can use its sales teams and infrastructure to broaden Big Fork’s presence or a private-equity-style investor that can inject capital into the business to allow Avery to hire more staff to scale the business.

Darren Tristano, president of Chicago-based market research firm Technomic, says the product is innovative and has a chance to be a hit; but its appeal likely will be limited to a niche group of bacon fanatics. “It’s the type of product that appeals to a more affluent, craft-focused consumer who’s willing to pay more,” Tristano says. Big Fork is “very well-positioned for a bigger brand to come in, and purchase it and build it up.”


Has America FINALLY hit ‘peak pumpkin’?

October 28, 2015

pumpkinKatie Little
© 2015 CNBC LLC. All Rights Reserved. A Division of NBCUniversal
http://www.cnbc.com/2015/10/02/has-america-finally-hit-peak-pumpkin.html

More than a decade after Starbucks helped make “pumpkin spice latte” a household name, there is some evidence that “peak pumpkin” may finally be coming to restaurants.

The country’s 500 biggest restaurants launched just 45 pumpkin flavored limited-time offerings, such as Dairy Queen’s Pumpkin Pie Blizzard Cake or Krispy Kreme’s Pumpkin Spice Doughnut, from January to September. That’s down 61 percent from 116 a year ago, according to data from Technomic.

“Although many consumers are still interested in pumpkin spice, recent years have shown heavy saturation with beverages and although the flavor is likely here to stay, the growth of the trend is starting to flatten showing we have reached maturity,” wrote Darren Tristano, executive vice president at Technomic, in an email.

Overall promotions are shrinking as well, falling 11 percent as operators adopt a “less is more” attitude borrowed from fast-casual restaurant hits like Shake Shack and Chipotle.

“Brands are starting to discover the fact that consumers are experiencing new menu burnout,” Tristano wrote. “This year marked the first year in a decade that top chain restaurant menus declined in total menu offering.”

At the retail level, growth is also showing signs of slowing.

For the year ending July 26, sales of pumpkin-flavored items rose 11.6 percent, the slowest growth in at least three years, according to Nielsen data. Declines in pumpkin-flavored coffee, milk and frozen waffles, pancakes and French toast were especially steep. Still, pumpkin-flavored item sales remain a large market, clocking in at $360 million at retail outlets, including grocery and convenience stores.

So if pumpkin has reached saturation, which seasonal item will start to take share? This is difficult to predict, Tristano says, adding it’s possible other seasonal flavors like gingerbread, molasses, peppermint or eggnog could increase.


A New Meaning For ‘to go’ at Restaurants

September 7, 2015

2015-09-02_1535Peter Frost
(c) 2015 Crain Communications, Inc. All rights reserved.
http://www.chicagobusiness.com/article/20150822/ISSUE01/308229990/a-new-meaning-for-to-go-at-restaurants

Before Charlie McKenna opened Lillie’s Q in Bucktown in 2010, he knew his small-batch barbecue sauces would play a key role in his restaurant’s success.

He probably didn’t expect that, five years later, his line of regional-inspired sauces such as Carolina Gold, Ivory and Hot Smoky would be in 2,500 stores in six countries and rise to become the fastest-growing premium brand in the segment. His retail line, which has expanded to include kettle chips, rubs and bloody mary mixes, is on the shelves at Target, Whole Foods, Mariano’s, Crate & Barrel and more, and is growing nearly fourfold each year. Revenue from the products equals that of any of his four restaurants.

“At a certain point, we were selling so many bottles from our restaurant we decided to test the waters with small local stores, then local distributors, then national chains,” says Brian Golinvaux, who was brought in to run a new specialty food division called Lillie’s Q Sauces & Rubs. “I would compare it to what happened in the beer category years ago—craft brewers saw an opportunity that the big brands were not serving and took market share.”

While restaurant-affiliated retail products aren’t exactly new—Rick Bayless’ Frontera salsas have been around for 16 years—a growing number of chefs and restaurants around Chicago are rolling out pastas, breads, sausages and sauces of all types to sell. But where there’s opportunity to boost revenue and name recognition, there’s risk.

“It’s a tremendous opportunity for restaurants to familiarize more people with the quality of their products as well as the brand itself,” says Darren Tristano, executive vice president of Chicago-based market-research firm Technomic. “The danger is, if you don’t actively manage the quality of the product, you risk having a negative reflection toward the brand.”

Because restaurant-generated packaged foods fall into myriad categories, there’s limited data on how much of the market such brands represent, though Tristano says the trend is gaining momentum.

Although chefs have a built-in advantage here—after all, they’ve spent months, if not years, developing and perfecting recipes in their restaurants—producing them for a retail customer and in large volume is a different animal.

First they must have a tastier chip, a tangier sauce, a superior sausage to others in the market. Then they’ve got to find a commercial-scale producer to make, package and distribute it, which often involves months of trial and error. From there, they must get it on store shelves at a price consumers are willing to pay. And they must do all of it at the same quality as what comes out of a restaurant’s kitchen. Any misstep in the process could be fatal.

“If you look back through history, there have been lots and lots of chefs who have launched retail food products, and in many cases, it has wound up hurting their brands,” says Manny Valdes, chief executive and co-owner of Chicago-based Frontera Foods, which makes tortilla chips, salsas, seasonings and prepared frozen meals that are sold at more than 65 percent of grocery stores across the country, with sales rising by about 20 percent a year.

For instance, celebrity chef Wolfgang Puck’s frozen pizzas once were in virtually every high-end grocer. Now they have disappeared from the market.

Closer to home, Stephanie Izard of the wildly successful Girl & the Goat in Chicago launched a series of marinades and rubs with online retailer Abe’s Market in mid-2013. The products are no longer available at Abe’s, and an Izard spokeswoman says the chef is relaunching the line. BellyQ’s Bill Kim, who sold five signature bottled sauces at his Chicago restaurants and niche retailers, has stopped producing that line, with the hope of relaunching in coming months.

PLAYING IT SAFE

Still, chefs and restaurateurs keep trying to go retail.

Jared Van Camp of Element Collective started selling house-milled flour and dried pasta from Nellcote soon after opening the West Loop restaurant in 2012. From there, he has branched into a retail juice operation, Owen & Alchemy, which sells bottled cold-pressed juices at Eataly, Local Foods and its own store. Recently, he was in Louisiana working with a co-packer to develop and bottle a line of sauces used at his Chicago fried-chicken joint, Leghorn.

He plays it safer by keeping production low and selling his products in a small number of local retailers. “It doesn’t cost much, it’s free marketing and everything you sell contributes to the bottom line,” Van Camp says. “There’s no risk to that.”

Formento’s, an Italian restaurant in the West Loop, opened in January with built-in plans to sell its products in its adjoining takeout spot and store, Nonna’s, mostly as a marketing tool. But its marinara sauce is selling so fast that owner John Ross is talking with local grocers about carrying his products, too.

And then there’s the Publican, which through West Loop offshoot market-cafe Publican Quality Meats continues to expand its retail and wholesale offerings amid soaring demand. PQM sells branded ice cream, olive oil, honey and granola, the latter in collaboration with Chicago cafe Milk & Honey.

Its breads and sausages are sold at Treasure Island and Local Foods, as well as at restaurants around the city. The sausages, produced by Hometown Sausage in East Troy, Wis., can be found on the menu of Chicago-area Shake Shack restaurants, at two professional sports stadiums in Cleveland and at festivals like Lollapalooza. The restaurant estimates that north of 5 percent of its annual revenue comes from its retail and wholesale products, a figure that’s poised to grow.

“Originally we were just a small shop on the corner that took some of the pressure off the kitchen at the Publican,” says Bradley Smith, PQM’s retail coordinator. “But as you go along, you realize, ‘Oh wow, we can sell these sausages all over the place.’ It just keeps getting bigger and bigger.”

But they’re fighting the urge to get too big too fast. One slip and they risk winding up in the same place as Wolfgang Puck’s frozen pizza.


Technomic: Fresh Meal Purchases Slump

February 20, 2013

CHICAGO — Consumers are buying meals less frequently from supermarket foodservice operations than they were two years ago, according to Technomic’s latest research.

Since this could mean that people are returning to the restaurant world for their ready-to-eat meals, Technomic researchers conclude that retailers need to make changes to see that their meal solutions stand out from those offered by restaurants.

The research firm found in its Retailer Meal Solutions Consumer Trend Report that just 38% of consumers surveyed said they purchase meals from traditional supermarkets each week. That’s compared to 42% who said that in 2010.

“These consumers may be reversing the patterns they set a couple of years ago by heading back to restaurants,” Darren Tristano, vice president of Technomic, said in a news release.

“For retailers to gain or maintain their share of foodservice dollars, they’ll need to clearly stand out from restaurants —especially since our data show that consumers’ expectations are rising for the taste, quality, freshness and appearance of retailer-prepared foods,” Tristano added.

Technomic’s research shows that some retailers are already making changes. In fact, in one of the major findings in a study that involved 20 supermarket chains, it was found that some retail meal solution menu trends included signature fried snacks, more variety for vegetable sides, higher-quality pizzas, a distinct specialty focus for sandwiches and burgers; and a move toward ethnic flavors.


Olive Garden stocks Sam’s Club shelves with dressing, cheese

May 11, 2012

By Sandra Pedicini, Orlando Sentinel, April 25, 2012

 Olive Garden’s Italian salad dressing and shredded cheese are now for sale in Sam’s Club stores across the country.

The Italian chain, owned by Orlando-based Darden Restaurants, said Wednesday the products will be sold at Sam’s Club stores exclusively for a year. Darden, which also owns Red Lobster and LongHorn Steakhouse, will study sales results before determining whether to expand its new grocery business.

 It’s a chance “to extend the brand beyond the four walls of the restaurant,” Darden spokesman Rich Jeffers said.

But don’t expect to buy breadsticks or chicken parmesan anytime soon. Darden says it would have difficulty re-creating the quality of its restaurant meals in frozen entrees, so it would stick with basic items such as the dressing and cheeses made by outside companies but marketed under the Olive Garden brand under a licensing deal.

T. Marzetti, which sells its own products in grocery stores, also makes the Olive Garden dressing. Lotito Foods produces the cheese blend.

Locally, a two-pack of 20-ounce Italian dressing bottles sells for $6.98. The 14-ounce, refrigerated blend of asiago, parmesan, romano and provolone cheeses carries a price tag of $7.98.

Olive Garden, which has already sold dressing in its restaurants for a decade, also will sell mozzarella and parmigiano-reggiano cheese in select Sam’s Club stores. Those will include some in Central Florida.

Seeing Olive Garden venture into the grocery aisles isn’t a surprise, said Steve West, a restaurant-industry analyst for ITG Investment Research. “We’ve seen this kind of trend for years.”

P.F. Chang’s, Romano’s Macaroni Grill and California Pizza Kitchen all sell frozen meals. Tony Roma’s, which has its restaurant operations based in Orlando, also sells frozen entrees and recently began hawking ribs on a cable home-shopping network.

Analysts said Olive Garden’s food manufacturers would likely pay the restaurant chain between 5 and 10 percent of sales in royalties. It would be small change for Darden, a company that rings up $7.5 billion in sales each year.

“It builds brand awareness, which I’m not sure they really need to do, but it does give them another revenue stream which doesn’t take a lot of cost,” said Darren Tristano, executive vice president of Chicago-based foodservice research firm Technomic. “I think even if it is successful, its not going to be that meaningful to a brand that’s so large.”

Tristano recently bought a bottle of Olive Garden dressing from Sam’s.

“I’m not sure it’s as good as it is at the restaurant,” he said. “That could be quality or psychology. I’m not sure. It’s close enough that I feel like it’s a nice opportunity.”


Retailers continue to expand prepared food offerings, gain ground on restaurants

September 26, 2011

Consumers taking part in a recent survey conducted by Technomic say they are sourcing prepared meals from a wider range of retail foodservice operations than they were two years ago, many times at the expense of restaurants. Traditional supermarkets, convenience stores and mass merchandisers have been able to grow their share of the food-away-from-home market as they expand their foodservice platforms and build upon consumer desire for convenience, quality and variety of offerings in retail locations.

“Retailers benefit from the fact that consumers are already visiting them for other purchases.” says Darren Tristano, EVP of Technomic. “If retailers can offer a foodservice option that rivals that of restaurants in terms of quality, freshness and variety, they can build on the advantage they inherently enjoy when it comes to convenience.”

Technomic’s new Retailer Meal Solutions Consumer Trend Report was designed to help restaurant operators, manufacturers and retailers stay on top of evolving consumer attitudes and preferences with regard to retailer meal solutions.

Interesting findings include:

  • Health is an important factor in the RMS purchasing decision, and seems to be of greater importance for RMS occasions than for restaurant meals. About two in five consumers say that they usually consider nutrition when purchasing prepared foods, compared to only about a quarter who say they consider nutrition when ordering food at restaurants.
  • Kid appeal stands out as the primary concept attribute that consumers think RMS programs are lacking. The attribute related to RMS’ appeal to children ranked among the bottom three for each type of retailer as compared to both limited- and full-service restaurants.
  • Forty percent of consumers who visit mass merchandisers and convenience stores for RMS purchases, do so at least once a week from those locations.