A distributor who gets food costs down
Ben E. Keith Foods
Fort Worth, Texas
ID ranking: 9th largest distributor in the U.S.
Accounts: 22,000 in the South and Southwest
2007 sales: $1.64 billion
Ben E. Keith Foods has been working with its clients for four years to help them become more profitable. These days, it’s finding its services in high demand.
“I work with customers on a daily basis in the areas of inventory management and application, food cost management, menu analysis and development, recipe application and development as well as staff and operational issues,” says Bud Andersen, business development director and former sous chef of 10 years. “When this level of partnership and trust is built with the customer, Ben E. Keith becomes an active part of his day-to-day operation, thus establishing us as a valuable resource to the operator.”
One of the core principles in its outreach to clients is controlling food costs. Andersen says when he sees a client with food costs of 35 to 38 percent he asks to look at the inventory—which might be too large—and to examine the menu prices—which might be too low.
“Because it’s the operator’s business, I ask where he wants his food cost figure to be. Then we look at the inventory, what he’s buying—and how—and compare it to the menu. Next, I conduct a menu analysis and look at the charge per plate and sales. By gathering this information, I figure out where he is and where he should be, then create a timetable for reaching that goal.”
For one customer with multiple locations, Andersen conducted inventory, cost and menu analyses and discovered room for cost savings.
“I began to investigate the application of many of their products and found something interesting in their chicken breast, which applied to 60 percent of the dishes they produce. I explained to the client that we needed to do a field test on the chicken breast. We completed the field test and found a 50 percent shrinkage rate in the chicken due to the process in which the manufacturer was marinating the chicken. When the customer was cooking off 20 pounds of raw product, the yield became 10 pounds. We were selling this product to the customer for $1.95 a pound. All of the menu items were figured using that number,” he related.
Andersen said the real cost of product was actually $2.93 based on the loss.“We were able to switch the customer out of that product and into a higher yielding chicken breast, actually cutting their food cost.”
Another example that Andersen offered was with a Mexican food operator that had never run an inventory system of any kind.
“After meeting with the customer, we did a cost analysis and set up an inventory program. Working with the owner and his staff, I observed an incredible amount of cheese being used both in portioning as well as when they were shredding it. I observed huge amounts of waste as they were throwing two to three pounds of cheese away after shredding it down so far. We corrected this issue and cut the food cost by 7 percent with that one item.”
Throughout the year, Ben E. Keith is involved in promotions with participating vendors. One of the latest is the Markon Salad Sellabration, a promotion that focuses on marketing-group Markon’s produce and Ventura Foods products.
“To further enhance this promotion, we developed an eight-week Salad Recipe Series. Our DSRs receive weekly flyers consisting of a recipe along with a brief write- up highlighting practical applications of products that we’re promoting. This is our second year with the Markon Salad Recipe Series. DSRs also receive a recipe-exclusive sheet targeted wholly to their operators, a tool to bring them new recipe ideas complete with our item numbers, food cost and suggested sell price,” says Andersen.