Since the pandemic burst onto the scene in the spring of 2020, the struggles of restaurant and foodservice operators have been well documented.
And rightfully so. The business environment has been equally challenging, though, on the supply chain that supports these operators. In addition to the need to social distance and sanitize anything and everything in sight, COVID-19 affected the way foodservice equipment and supplies dealers support their customers, interact with their supply chain partners and more. As part of its 2021 Distribution Giants Study, FE&S spoke with leaders from five foodservice equipment and supplies dealers to get their perspective on how their businesses have fared during the past year, what’s next and more. Here’s what they had to say.
(Editor’s note: Not every dealer was asked each question. Plus some of the answers were edited ever so slightly for clarity and style purposes.)
Kamran and Company, Santa Barbara, Calif. (29th largest dealer, per FE&S’ 2021 Distribution Giants Study)Kamran Amiri, vice president at
Patricia Bible, president of KaTom Restaurant Supply, Kodak, Tenn. (No. 6)
Gene Clark, CEO, Clark Associates (No. 1)
Steve Don, CEO and president of Edward Don & Company, Woodridge, Ill. (No. 3)
Mark Rossi, CEO and founder of Avanti Restaurant Solutions, a Costa Mesa, Calif. (No. 47)
2021 did not get off to a good start with the political unrest and the brutal February weather that impacted so much of the country. How has your company dealt with that? And what’s the outlook for the rest of the year?
GC: Everyone thought on Jan. 1 it would be out with the old and in with the new, but it really felt more like a continuation of last year. That level of success for us has continued. More and more customers see the value we bring to the table as we continue to leverage that combination of human and digital interaction.
PB: We had such an enormous January 2020 that it was going to be hard to stack up against that in a COVID year. Yet we grew by low double digits in January and grew by very high double digits in February despite the political unrest and the weather. Our company is run by analytics. We were able to redirect and regroup, sending our marketing to the areas that were not shut down or affected too much by the political unrest. I felt we needed to double and triple down on sourcing products and opened 40,000 square feet of additional space. Having that has become a blessing for KaTom.
KA: It’s off to a very good start. We are one dealer, but we are very optimistic about how business will continue. Some of our major accounts in Northern California are sending us projects for pricing and they are good-sized projects. We have calls with contractors and architects to general scope other projects. There are some bigger projects coming back in Las Vegas coming back.
SD: We see gradual, week-over-week improvement. There’s definitely a correlation between dining room capacity and our business. The states that are open are doing better and the ones that are just opening are a little behind the curve. We are not there yet but it’s nice to see the week-over-week improvements.
MR: There is a lot of buzz and a lot of activity. I am optimistic and believe it will start to loosen up. We are continuing to invest and run the company as though we are going back to a similar volume scenario. We invested in an ERP system during the downturn and that will introduce some efficiencies for us. Now you just created a void in a pipeline and will have to wait another period of time before that pipeline starts up again. And then there could be constraints surrounding the availability of products. COVID fatigue – meaning the fatigue of this whole thing – is real. People have gotten used to a different sort of demand phase and I think ramping up will be tough on people, too.
How did the pandemic change the way you work with your customers?
MR: All travel ended and is still sort of on hold. That was probably the main thing. That meant we had to get more comfortable with remote work in the field. We were set for the pandemic in that we did work all over the nation remotely and already understood last mile logistics. It just reminded us that you have to be tight on your processes and procedures and we had.
KA: Lots of people were not traveling, including me. Some people worked from home, but the estimating department never stopped coming to the office. Some people, like myself, worked from home for a month and a half and then there was no more home office for us. Some meetings, instead of being in person, have been taking place via video conferencing and they have gone well. But our major projects, particularly in Las Vegas, were in person. Our people were on the job site. We’ve been in person with roughly 80% of our projects. Some of the smaller ones we did via video conferencing. Thank goodness we did not have any damages to anyone personnel-wise from COVID.
What makes you optimistic about the future of your business and the industry?
PB: It’s what has happened the first seven days of March 2021. They have been so over the top – more than we thought or could have imagined. That allowed us to see if it’s this way in March it will be ongoing. There’s also a lot of pent-up demand for people wanting to get out and enjoy their lives again. A lot of the stale concepts have gone by the wayside and that leaves a lot of room for new concepts. I think the next five years are going to be incredible from a foodservice equipment and supplies perspective.
SD: I think there’s a lot of pent-up demand. People are tired of cooking and having food delivered. The vaccine is starting to get out faster than planned. The latest amount of stimulus is starting to hit the market, too. We have always done well as a company following a recession or crisis. Plus, we have the same management team in place that learned from 9/11 and the financial crisis of 2008. We acted quickly and have a good balance sheet and inventory. A lot of it is relationships, too. We’ve been out there working with people. All of those operator segments have different challenges, so it comes down to having solutions to meet those challenges.
GC: We feel good about customer demand. February had a winter-weather impact throughout many parts of the country. We still see demand and runway there. Our biggest challenge is managing the supply chain volatility – freight logistics, lead times, cost. We are in for many months of supply chain volatility.
KA: The prospects that we see – the owners and the developers are talking with us. Plus, we’ve been in conversations about a project in the Middle East. We’ve never done a project in the Middle East and I am excited about the possibility. So, we are excited about all of this information that’s coming through the channel from multiple sources. Operators running ghost kitchens is also exciting for us as it represents a new opportunity for our company. We see these things happening and feel it’s encouraging.
MR: People’s desire to get back out there. All of that energy has been held back and contained. Once it gets back out there and people start living again it will be good for our businesses and our personal lives as well. It’s sort of a new frontier. It’s never going to be the same. So there’s excitement about the new way of life and concepts that will come along.
What’s one way your company will emerge stronger as a result of the past year?
PB: 53% of KaTom’s employees are Millennials. They are so sharp thinking and engaged. They are anxious to come to the decision-making table and have great ideas. We have experienced collaboration unlike ever before over the past year. We’re excited about the future.
SD: We’ve definitely picked up additional items that customers have requested, so our product categories have increased. Our customers have gotten more innovative. And the good customers will gain market share and we are well aligned with them. Customers who are down with us are positioned to come back strong. It’s survival of the fittest.
GC: We think customers continue to appreciate the different platforms we offer and it has pushed us to continue what we are doing. We were happy with all aspects of our business. The contract side, design build/heavy equipment, was challenged somewhat because customers pulled those projects off the street. The other aspects of our business had their best years ever. That’s the thing we really didn’t adapt. The Webstaurant Store and Restaurant Store – they did what they did. We quickly morphed into contactless pickup for cash and carry. We were really fortunate that we were positioned that way. We met a lot of new customers last year. So if they are voting with their dollars we are providing something they want.