It's a dairy market

Dairy Foods, June, 1998 by Sue Markgraf

Partnering with restaurateurs can help dairy processors get a slice of the estimated $336.4 billion foodservice pie.

The intensely competitive restaurant industry is faced with many of the same issues plaguing the dairy business. Topping them are consolidation, labor shortages and costs, and food safety. Food and package waste, convenience and quality also are factors, and all are potential opportunities for dairy processors.

"It's a wide open market," says Mary Pat Knight, foodservice consultant and pres. of Organization Performance Solutions, Glenview, Ill. She formerly was marketing dir. at Lettuce Entertain You Enterprises, a Chicago restaurant chain. "If you can come in and help an operator do business smarter and better and partner in that effort, you're invaluable and both businesses benefit."

"If you can do it and package it cheaper than I can, I'm certainly interested, as long as quality is not lost," adds Russell Scott, chef/proprietor, American Made Restaurant, Steamboat Springs, Colo.

In an arena where dairy is often considered a commodity ingredient, branding raw products, and naming them on the menu, is a trend that's increasing, chefs say.

"You offer us tremendous opportunity by branding raw ingredients because our customers want things fresh," says Jim Miller, v.p.-Midwest Region, Aramark Corp. Miller spoke to processors at the recent International Dairy Foods Assn.'s 1998 SmartMarketing conference. "One of the great successes we've had is building relationships with suppliers. We use their expertise. In turn, we offer a huge channel for selling their products within our industry."

Whether it's creme brulee at a posh white tablecloth, fresh sour cream and shredded Mexican cheese blend on an enchilada from a Marche-style vendor, or a strawberry smoothie at a '50s-style diner, the '90s consumer demands more product choices on the restaurant menu. That's an opportunity for dairy processors.

"People are funny. They say they are health-conscious and watch their weight, but when they go out, they really go for it," says Hartmut Handke, chef/owner, Handke's Cuisine, Columbus, Ohio, and mgr., Culinary Team 2000, which competed at the recent National Restaurant Assn. convention in Chicago. "We look for new ideas, for taking an old product and freshening it up."

But restaurateurs say partnering doesn't mean coming in with a portfolio of recipes and an attitude for using your products. Instead, it means arming yourself with knowledge about product quality, applications and uniqueness.

Quality comes first, says Rudy Speckamp, chef/owner, Rudy's 2900 Restaurant, Finksburg, Md. "The first thing I would ask a dairy processor is, 'How does it taste?' The flavor has got to be soothing to the palate. The next question would be, 'What kind of shelflife does it have?'"

Stella Foods, Lincolnshire, Ill., is helping restaurants get closer to homemade with its new Stella Signature blends: Tre Brandelli, Fumebuono and Quattro Formaggi, specifically designed for foodservice. In 5-lb bags, the pre-shredded cheeses provide flavor consistency and maximize convenience with tear open and pour packaging.

"Blends are a very, very challenging item for (operators) to develop themselves," says Susan Regal Wagner, Stella's dir.-foodservice marketing. "Certain cheeses work well with others, but a lot of them don't and the consistency factor from the back of the house" can be an issue.

"It's very hard to guarantee anything consistent the way labor shortages are in foodservice," Wagner continues. "You may be retraining the person in charge of making the blend every couple months."

"With industry being what it is today and our industry suffering from downsizing just like any other, most of the creativity and knowledge is by fewer people within one operation," adds Neil Becker, culinary arts teacher and part-time lecturer at the New York Restaurant School.

"It's very important that a processor be able to tailor the actual product or formula, and also the physical aspect. If a processor is using cheese cubed for a crudite or cheese platter or display board and is amenable to supplying that cheese in 1-inch or 3/4-inch cubes, that's an excellent marketing point," he says.

"Obviously, there has to be a relationship between cost-effectiveness for the end-user and retooling for the manufacturer. But if one end-user wants it grated, perhaps other operations would want it as well," Becker adds.

Precisely what Stella's Signature blends are all about, says Wagner. They "address the desire from the end-user to have more flavor choices. We never profess to know our customers' business better than they do, but when given the opportunity, we love to go in and show operators new, more convenient ways of doing things."

With an eight-year career in foodservice at Blue Bell Creameries Inc., Dallas, Mike Niebuhr believes he knows what foodservice clients want. His secret: Get a distributor if you plan to go national and follow-up on what you promise.

"Leave it up to the chefs to develop the right structure" for the creative concept, Niebuhr says. "They get the base and then I'll throw out some ideas. They're the experts. But you've got to be creative."