How to find value in highly specialized foodservice equipment.
The foodservice industry has a tendency to focus on multifunctionality: How can you make the most of your money, floor space, labor and menu with a single piece of equipment?
For that answer, the combi oven is the Cadillac of multifunction, promising to bake, blanch, roast, grill, retherm and hold everything from baked goods to pizzas, whole-muscle meats to french fries all in one modest unit.
But a crop of highly specialized pieces of equipment is showing up on trade-show floors. Oatmeal dispensers, specialty-drink machines, pancake makers: These units focus on one task, often a trendy food item, and are typically highly automated. Such equipment garners much attention, especially when it’s a countertop conveyor belt spitting out 200 pancakes in one hour. Is such equipment worth your investment? Before you decide, ask:
- Will you be able to move enough product to make it a worthwhile purchase?
- Does the equipment and the food it makes fit within your company’s goals?
- Does it provide enough variety within the menu category?
- Will it offer you a niche that distinguishes you from your competition while meeting a consumer need? Pump up the Volume
Return on investment is a constant benchmark in purchasing decisions. But when a piece of equipment is highly specialized and automated, it typically can’t be easily repurposed for a different menu category. This makes ROI crucial.
“If it’s unifunctional, it better have a lot of sales associated with it,” says Jerry Weiner, vice president of food service for Rutter’s Farm Stores, York, Pa. “The automated machines have to be able to deliver on the costs that are associated with them; otherwise I can’t recommend it.”
To determine ROI, factor the cost of the equipment—both capital and operating costs (utilities, labor and waste)—against its benefits, which can be top-line sales or a reduction in operating costs.
“Eighteen months, for example: That’s pretty powerful, because that’s not a long amount of time,” says Juan Martinez, principal at foodservice design consultancy Profitality, Miami. “Then when you start throwing in things like depreciation and a few other pieces, normally it gets better. On the other side, if you have to get a loan and the loan is high-interest, it may not get better. There are many ramifications.” Martinez also recommends considering the life span of the equipment and the evolution of the technology. Take, for example, a cell phone: Most consumers replace their cell phones before their life span is over due to technological advances, thus stopping ROI in its tracks.
Further, some menu items can become requirements for retailers. “If someone else has it, then you must have it and it becomes less of an ROI exercise,” Martinez says. “But at the end of the day you better have something to show for why you’re making the decision.”
Quick-serve restaurants can get away with highly specialized equipment because of the volume they serve. Even general pieces of equipment such as broilers are automated for speed of service. “They have these broilers that do very precise things, but they do so much of it that it makes a lot of sense,” he says. For QSRs, speed of service is a core goal. Likewise, justifying such highly specialized equipment means ensuring it fits your company’s goals.
Martinez points to McDonald’s new specialty smoothie and frappe line. The drinks are made using the Multiplex Blend-in-Cup Beverage System from Manitowoc Foodservice, Manitowoc, Wis. The machines are available either self-serve or crewserve, have an on-board nugget ice maker, icon-based touch-screen control, and a multiproduct dispenser with two mix stations that can blend up smoothies, frozen lemonades, frappes and dairy products.
“For them,” says Martinez, “it was all about being able to deliver in this category—coffee and smoothies—to take share away from others that are very successful, but do it within the bounds of their speed guidelines.
“They can introduce different products,” he continues. “But if the product does not meet or fit within those executional guidelines, it’s going to get in the way of their core business, and by de facto they’re risking, for example, 95% of their business to gain 5%, which is not a good business decision.”
Even though smoothies or frappes as single menu items are not part of McDonald’s core business, they did fit the company’s goals to improve its drink program. That, says Weiner, makes an investment worthwhile: “If it’s part of a total package, if I was doing a coffee bar that’s crew-served and I need frozen coffee equipment, espressos, lattes, then great.”
It turns out the Multiplex Blend-in- Cup machine is currently in test with two c-store companies, according to Bill Hallett, vice president of field marketing for Manitowoc Foodservice, though he could not disclose what the chains are. The company is currently tweaking a model to better fit c-store applications.
“Most of the c-stores are interested in a self-serve setup, and the model we have was not originally set up to be a self-serve,” says Hallett. “However, until we come up with what we believe will be an ideal c-store model that would fit a larger number of c-stores, we are modifying this one a bit so that it can fit into a self-serve environment.”
Expanding an Offer
At Family Express, which operates 52 stores across northwest and north central Indiana, the company sought to use the strength of its coffee program to roll out instant oatmeal. The oatmeal falls under the company’s Java Wave coffee brand and ties to a broader objective.
“Jawa Wave oatmeal will complement our quest of offering customers seeking a healthier alternative on the go,” marketing vice president Bill Nolan said in a December release. (Family Express declined to be interviewed for this story.) The oatmeal—available in original, apple and cinnamon, and maple and brown sugar varieties—is also tied into the company’s FE Perks cents-per-gallon pump-rollback loyalty initiative.
The machine is marketed by Nec’Tar Cappuccino Co. and manufactured by Curtis, which converted one of its cappuccino machines to make oatmeal. “It’s proven technology, so we just changed the platform,” says Kevin Curtis, executive vice president. Three bins hold three different kinds of oatmeal—all kept dry. When a button is pressed, the dried oatmeal and hot water dispense simultaneously into the cup. The water doesn’t interact with the oatmeal until it hits the cup, reducing cleaning and clogging.
There are “several hundred” machines in the field now, says Curtis, and the company has received interest from c-stores, QSRs, hotels and fullservice restaurants that serve breakfast. For them, it’s a better solution to a kettle of oatmeal drying up as the breakfast day-part ticks by.
“The response has been really good. People are telling us that the oatmeal is product is fast, convenient, each serving is made fresh, and it tastes great,” says Curtis.
Taking a Risk
Many of these machines show promise but are either brand new or still in prototype, making it difficult for retailers to gauge their success and long-term viability.
Such is the case with ChefStack, an automated pancake machine. Batter is dispensed between two Teflon-coated belts, which cook the cake as it moves through the microwave-size machine. Software in the device monitors the batter size deposited on the belts and tracks the number of pancakes produced. The unit makes three sizes of pancakes and can crank out 200 medium-sized pancakes in one hour.
ChefStack exhibited at the 2009 NACS Show, and it since has landed its units in a variety of channels. Tully’s Coffee shops, Alaska Airlines’ Board Rooms, at least one c-store chain and even a Ponderosa in Puerto Rico are testing the machines.
“We’re really trying to focus on getting into a few big chains, working with them and then coming back to the industries and saying, ‘OK, here are the numbers,’ ” says Bill Brouillet, chairman of ChefStack, based in Seattle.
While a benefit of the ChefStack is the automation and therefore less labor, the theater of the machine is equally appealing. The Ponderosa places it on the buffet, and at Tully’s employees move the machine out to the front counter during breakfast, occasionally offering free samples.
“We’re actually working with a company to get a glass door in front because everybody is very enthused about watching the pancakes being made,” says Brouillet.
One Item, Many Varieties
A final question to ask when considering an investment is whether there’s enough room for variety within the menu category the equipment serves. Martinez of Profitality points to the new batch broiler Burger King unveiled last March.
“It broils, but it broils a lot of products, so it gives them the product flexibility within the process of broiling,” he says. Burger King used this as a selling point when rolling out the machine, launching a limited-time offer of bone-in St. Louis-style ribs in three-, six- and eight-piece portions.
The chain continues to test a variety of products on the new broiler, including stuffed burgers, desserts, snacks and breakfast items. “But again, that’s a very automated broiler,” says Martinez. “You load it, you push it in and you press the button. It drops into a pan and you put that pan in a hot hold. Nobody has to touch it.”
Variety is also touted by the folks at ChefStack, who recommend serving the pancakes filled with sweet jams or savory sausage as a turnover, folded in a sleeve with fresh fruit, or in a cup with whipped cream and strawberries. The Multiplex Blend-in-Cup is likewise proving its diversity in making fruit smoothies, coffee frappes, Italian sodas, lemonades and more.
Deciding on specialized equipment simply requires a closer look at questions you already ask. Martinez sums it up: “What am I selling vs. what am I paying, and does it fit the business case?” Unless you can convert a pancake maker into a roller grill, or get your oatmeal dispenser to calculate your payroll every week, you’re getting what you pay for. So make it worthwhile.
Extra Credit: Sous-Vide
For those ready to take their kitchens to the next level, there’s sous-vide. The technique uses circulators to keep a water bath at a very precise temperature to cook foods in vacuum-sealed bags. (Sous vide means “under vacuum” in French.) Restaurants use it to cook delicate foods such as lobster without drying it out, or secondary cuts of meat such as short ribs to make them tender.
But Philip Preston, president of sous-vide equipment manufacturer PolyScience, Niles, Ill., sees plenty of opportunities for the technique outside fine dining. “When people ask me about the benefits of sous-vide, a lot of times you focus on the flavor, the texture, the perfection of doneness. But actually I think right up there is the timing issue, especially in a c-store application, where who knows when someone is going to walk in the door and want something,” he says.
Food can be held at a controlled temperature for a long time when in a water bath. Preston points to eggs: “If I put eggs in a 164-degree bath, they’re perfectly poached in the shell, and I can control exactly the level of doneness.” There are also food manufacturers, such as Cuisine Solutions, that cook prepared meals for foodservice and retail sous-vide. “They supply Costco, the troops in Afghanistan and Iraq, Amtrak—what they’re trying to do is really elevate the boil-in-a-bag meal, for lack of another term,” says Preston.
Operators can retherm such products in boiling water, but there is a reason sous-vide purists insist on cooking at very low temperature. “When you expose proteins to a high temperature, as soon as you go above about 70 centigrade, you start bursting the cell structure,” Preston explains. The food loses moisture and you end up with a stew-like bag of food. That bursting cell structure and moisture loss also reduces yield.
“I don’t think it’s coming on the horizon really fast, but if you think about what it can do for you, it’s phenomenal,” says Juan Martinez, principal at design consultancy Profitality, Miami, of sous-vide in more mainstream operations. “The challenge, if you are a large brand, is the supply chain and the cost. But if it allows you to do something you can’t otherwise do, it might be worth it.”
Jerry Weiner, vice president of food service for Rutter’s Farm Stores, York, Pa., agrees that there is potential for sous-vide in the c-store industry, but it’s not here yet. “There could be play with that,” he says. “It gives you a lot of variety, but it would have to improve for me the time it would take to bring to temperature and the availability of the product.”