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Operations

With in-store dining gone, restaurants become grocery stores

Operators are inviting consumers to shop their inventory for food and supplies.
big boy's market

With dine-in operations banned in a majority of states, restaurants are scrambling to stay in business. At the same time, supermarkets are scrambling to keep essentials such as toilet paper, bread and milk in stock. To provide shoppers with an alternative and maintain a little cash flow, restaurants are turning into grocery stores.

Frisch’s Big Boy, a quick-service chain across Kentucky, Ohio and Indiana, is opening up its locations as Big Boy’s Markets for consumers to stock up on food and other supplies. On hand are perishables such as milk, celery, broccoli, tomatoes and Frisch’s housemade tuna salad, along with more shelf-stable items such as bread, sugar, single-serve cereals, ketchup, mustard, bottled water and one of the scarcest commodities—toilet paper.

“We already have our own commissaries and distribution centers that bring in supplies to our 120 restaurants every day,” says Frisch’s CEO Jason Vaughn. “Our chairman, Aziz Hashim, came up with the market idea to help out the community.” Last week, 100 locations transitioned to grocery stores, allowing customers to shop by drive-thru without getting out of their cars or order through Frischs.com for delivery.

“Orders skyrocketed to hundreds within a few hours,” says Vaughn. The chain promoted the switchover to its customers and followers through multiple channels, including Twitch for the gaming crowd and local TV for seniors. “We modeled out product, and our current supplies can last 60 days,” Vaughn says. While the stores do contribute revenue, third-party delivery and distribution costs cut into profits. But selling groceries allows more of Frisch’s displaced team members to work some hours and builds goodwill in the community, says Vaughn.

Los Angeles-based Dog Haus is also opening its pantry to customers. In stock at the newly opened Haus Markets are the chain’s gourmet hot dogs, burgers, sausages, rolls and tater tots that guests can cook at home as they shelter in place, as well as staples such as milk and butter.

“We had to look at the products we use and create a menu that would help our customers,” says Andre Vener, co-owner of Dog Haus Worldwide. “Grocery stores are being decimated, but restaurants and their distributors are sitting on so much product that it would be a shame not to find a way to still feed our guests. The restaurant business is about hospitality.” 

It took a little preplanning to set up the POS, procure the right kind of packaging and work with each location to implement procedures, but all that was done in a few days, says Vener. To get the word out, Dog Haus put together videos that it’s posting on social media and through its Haus Market website.

“Haus Market is both for the business and our customers,” says Vener. “The business needs to survive this crisis, and it’s important for our customers to realize the country isn’t going through a food shortage.”

Not all the grocery stores springing up have been created by restaurant chains. Foggy Rock Eatery & Pub, an independent in Blowing Rock, N.C., is selling pints of its housemade chicken salad, pimento cheese, pulled pork, soup and salad dressing—as well as toilet paper.

“As a small business, we are trying to adapt the best we can,” says Foggy Rock owner Burt Myers. In addition to offering takeout and curbside pickup, “We decided to turn our lobby area into a refrigerator section with to-go favorites.” Myers had to cut his staff from 45 to three, and those employees are running the store.

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