Chewing on Foodservice

Paul Reuter, Founder and former CEO, CSP

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It’s great to have our longtime friend and industry “scholar” Dick Meyer contributing another thoughtprovoking column in this issue. (See “The Good Earth of C-Stores,” p. 38.) Dick has for the many years I have known him—many more than he and I want to count—always been front and center with his observations and the first with his hand raised at industry education sessions. In his column he reflects on the “state of industry people.” Dick’s influence on our industry has been significant. You may not always agree with his point of view, but rarely is that view dismissed without a long pause and head shaking. His column labels him a “veteran consultant”; I would call him Yoda.

 One question he explores: “Is there a parallel between successful c-stores and their agricultural roots?” His question caused me to pause.

Next month’s recap of the NACS® State of the Industry Summit will be rich with information. But like many of the 400 who attended, I thought the overall lack of progress in foodservice as an industry was the showstopper. As John Zikias told us, “The story in foodservice is all about beverages.”

We’ve talked a lot about foodservice and how our channel needs to embrace it. I’m having second thoughts on that. From the latest preliminary data, there are some who are great at preparing and selling food; and, frankly, there are some who, if they don’t get on with it, shouldn’t be in the game. Simply put, the gap between topquartile operators and the rest is widening to where it seems we’re two industries. On the one hand, we have the top performers selling close to $28,000 per store every month; at the bottom end, it’s a tad over $8,000. Put another way, when factoring in labor costs and food waste, only one-quarter of our industry is really making hay with foodservice—not what one might expect for an industry’s silver bullet!

I am a “glass half full” guy, so I could interpret the data as some good news and a call to action: Many have proven foodservice has a meaningful place in our stores—and many have an opportunity to crank it up!

The following comes from GE Capital Franchise Finance 2011 Industry Review presented at CSP’s annual Restaurant Leadership Conference: “Personal consumption comprises approximately 70% of the nation’s GDP. Pent-up demand and an improved economic outlook are driving consumers back into restaurants and retail outlets. The recession prompted a supply correction within the industry as chains and independents closed units, which coupled with strong consumer demand should be favorable for sales in 2011. … The tone has shifted from reset to recovery. Operators are changing menus, offering bundled value meals, remodeling units and installing new equipment to serve returning customers.”

I would also encourage the innovators to investigate the role “mobile foodservice” can offer your brand and profits today. I would be happy to e-mail you an article from our recent FoodService Director magazine that says, “With the demand for food trucks in overdrive across the U.S., noncommercial operators are yielding to the trend’s popularity and offering mobile options as an additional element to their dining service lineup.” Mind you, these trucks do not in any way resemble the old “roach coaches” from days of yore; they offer gourmet treats made from top-ofthe- line ingredients. Some foodservice directors say they have found the trucks to be a lucrative addition.

And speaking of embracing foodservice: I highly recommend you visit our FARE website (www. to learn about the only conference and trade show dedicated to all foodservice at retail, to be held June 28–30 in Scottsdale, Ariz. The agenda provides 8 hours of focused learning, as well as a food pavilion with the latest products, programs, equipment and technology.

I hope this column offers you some food for thought.  

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