Wheying the options

Dairy prices seem to be going up faster than cream rises to the top of a vat of milk. While relative bargains were available when cheese prices crashed in January 2009, there's been a surge upward since then, notes Dick Groves, publisher/editor of "The Cheese Reporter" out of Madison, Wisconsin. To ease the pain, some operators can cut down on the number of cheesy appetizers and entrees they serve, but concepts that focus on pizza, cheeseburgers, enchiladas and quesadillas simply can't do without it. Volatility in the cheese market is the biggest challenge, Groves adds. "Cheese prices move all over the place and are very unpredictable, but it looks like they will be above average this year."

That said, operators agree that cheese adds value to the menu, so they're working hard with suppliers to sustain profitability without compromising on quality and customer expectations.

Dos Coyotes Border Café
Sacramento, CA-based

With seven locations serving hundreds of burritos, quesadillas, salads, enchiladas and nachos, it's not surprising that Dos Coyotes uses 840 pounds of cheese a day—about two-thirds Monterey Jack and one-third cheddar. Owner Bobby Coyote buys 40-pound blocks that are shredded daily back of house. "I don't like pre-shredded cheese because it tends to be dry," he says. "Plus I always source real cheese and try to stay as local as possible." Spring Hill Cheese Company located at Petaluma Creamery is a major supplier; in April, Coyote was paying about $2.50 per pound for their product as opposed to $1.80 for commodity cheese but "it's worth the difference. The cheese is very high quality—not oily or runny," he explains.

Seasonal dishes or specials sometimes call for sourcing further afield—Dairy Gold cheese from Washington State is another Coyote favorite. Others that appear in menu items include pepper jack, pesto jack, cotija, Parmesan and mozzarella. "Restaurant owners sometimes have to get down and dirty to source great cheese," says Coyote, who can be found hanging out with dairy cows.

Prairie du Sac, WI-based

This 431-unit burger-and-frozen-custard concept is spread across 19 states, but they stick close to home when it comes to purchasing cheese. "Our roots are here so we buy our cheese from Wisconsin producers," says Jim Doak, Culver's director of research and menu development. "The cheese has a certain richness. Besides, we like to export a little bit of Wisconsin to the Culver's in other states."

A local Land O'Lakes facility supplies natural aged Swiss, American and aged cheddar, while Sargento provides varieties including smoked cheddar, habanero pepper cheese and a new cheddar which, thanks to technology, has pieces of mushroom and bacon incorporated inside it. While several cheeses are mainstays, specialty products may rotate in quarterly. "All our cheeses are proprietary," reports Doak. "We did a lot of work to get to the right level of aging, slice size and flavor." These specs are especially important to the taste and consistency of the chain's signature Butter Burgers and fried cheese curds.

Cheese prices have been pretty favorable the last two years, Doak admits, but he has seen an uptick in 2011. With the volume it orders, Culver's is able to lock in monthly prices to help control costs.

Sapphire Laguna
Laguna Beach, CA

"With California as a leader in artisan cheeses, we can source most of our product from local cheesemakers," says Azmin Ghahreman, chef-owner of Sapphire Laguna and its neighboring retail shop, Sapphire Pantry. Many of his favorites come out of northern California, including Humboldt Fog and Bandaged Cheddar; Winchester in southern California provides Super Aged Gouda made with raw milk. But Ghahreman also taps Wisconsin for a tasty Gruyere, Indiana for two goat cheeses—O'Banon and Sofia—and Oregon for a blue cheese known as Oregonzola. "Domestic cheeses are more cost-effective. I've had a harder time with imported cheeses because of the value of the dollar."

Cheese shows up in many guises on Sapphire's globally inspired lunch, dinner and "Spice Plates" menus. The latter features small plates and bar food, including the well-loved Cheesemonger's Grilled Cheese sandwich served with Parmesan fries and garlic aioli. "I usually use two cheeses for this sandwich—Bandaged Cheddar and Italian Robiola—but you can use any cheeses on hand," notes Ghahreman, who often grabs product from his shop next door. "This keeps inventory moving and controls costs."

On Sapphire's dinner menu, there's always a dessert plate featuring four rotating artisanal cheeses. It's served with local honey, confiture or jam made from local fruit and local olive oil to add value to the plate.

Crazy Dough's Pizza
Boston, MA

It makes sense that mozzarella—both fresh and pre-diced—is a high-volume purchase for this five-location pizza concept, but cheddar, gorgonzola, feta, Parmesan, ricotta and goat cheese also figure on the menu. To keep costs in check, owner Doug Ferriman is strict about portion control. "We are too small to hedge against price increases by buying futures, so we maintain consistency of menu prices by measuring carefully," he reports. "I've also cut back a bit on labor, posting directions on stations instead."

One area Ferriman won't mess with is cheese quality. "Using top quality cheeses is part of our philosophy. Calling out the types on our menu adds value," he claims. "Higher prices for these cheeses may be hurting my bottom line right now, but my ultimate goal is to retain customers." Pizzas like the signature Nutty Tuscan keep them coming back. This award-winning best seller is a white pie with oven roasted plum tomatoes, caramelized onion, roasted garlic, toasted pine nuts, crumbled gorgonzola and basil pesto; the price ranges from $6.75 for a personal pie to $20.75 for a large crowd-pleaser.

Product cutting

Goat cheese (chevre)
Led by Woolwich Dairy

Ten years ago, most operators would have been shocked to see goat cheese ranked among the top 15 cheeses on restaurant menus. But customers are enjoying the tangy cheese in salads, appetizers, pizzas and even desserts. When buying chevre—the popular soft, fresh, unripened goat cheese—this is how to evaluate the product.

  1. Open the package. The chevre should have a clean, bright white color. When crumbled, the curd should come apart easily. The product should never appear wet or sticky.
  2. Smell the cheese. A quality fresh chevre should have a clean, pleasant aroma with a slight buttery note. The slightest sign of yeast or ammonia can indicate spoilage. And a damp, over-acidic or animal smell means the chevre is past its prime.
  3. Check the texture. It should be smooth, soft and creamy—not gritty or chalky.
  4. Taste the chevre. The flavor should be subtle, clean and fresh with a slight hint of citrus or tanginess. After holding the cheese in your mouth for several seconds, you should experience a nice acid note with a rich, buttery accent.
  5. Notice the aftertaste. The chevre should finish as it begins—with a clean, fresh note. The flavor should not linger unpleasantly on the tongue.

Market report

Like beef, pork and chicken producers, dairy farmers are paying more for feed these days. The more expensive corn becomes, the less milk the dairy industry will produce and the higher the price of cheese. Commodity cheese prices are forecast to average $1.665 to $1.715 for the year, according to an April dairy outlook report from the Economic Research Service of the USDA—not as bad as originally expected but higher than average. "Prices have been over $2 per pound only four times in history, with a record price of $2.28 set in May, 2008," notes Dick Groves, publisher/editor of industry publication "The Cheese Reporter." "In April, prices were around $1.60 per pound for 40-pound cheddar blocks."

Although that's better news for cheese purchasers, Groves points out that we're on an inflationary swing and won't see $1.30 prices again. "I've heard rumors that the price of cheese will be going up in the second half of 2011 and my prediction is it will stay above $1.50," he adds.

While cheese companies can hedge milk futures, operators usually can't. His advice: "Go to your supplier and say ‘I'm sick of volatility in cheese prices; can I lock in a price that's about 20 cents more than the average I paid last year?' That will protect you against monthly volatility."

The big cheese

What cheeses lead in menu mentions? And what dishes are they showing up in most often? Datassential MenuTrends Direct has the latest stats from the top U.S. chains and independent restaurants.

Menu penetration of top 15 cheese varieties (% of restaurants serving among appetizers, entrees and sides)

  • Cheddar 48.4%
  • Mozzarella 48.0%
  • Parmesan 47.9%
  • Swiss 36.8%
  • American 33.9%
  • Provolone 29.2%
  • Feta 27.2%
  • Bleu cheese 25.8%
  • Cream cheese 25.4%
  • Jack cheese 23.3%
  • Ricotta 20.7%
  • Fresh Mozzarella 14.7%
  • Monterey Jack 13.9%
  • Goat cheese 13.6%
  • Gorgonzola 12.7%

Percent share of top 10 items menued with cheese

  • Hot sandwiches 16.9%
  • Pizza 10.8%
  • Cold sandwiches 9.0%
  • Mexican entrees 7.9%
  • Burgers 7.2%
  • Entrée salads 6.9%
  • Pasta/noodles 6.6%
  • Appetizer salads 5.0%
  • Egg dishes 3.5%
  • Chicken 2.6%

Members help make our journalism possible. Become a Restaurant Business member today and unlock exclusive benefits, including unlimited access to all of our content. Sign up here.


Exclusive Content


Pricing has driven restaurant sales growth for the past 2 years

The Bottom Line: Restaurant sales have grown for most of the past two years. But they haven't kept pace with menu price inflation, suggesting the industry is saturated again.


Restaurants can learn some foodservice tricks from supermarkets

State of the Plate: Nancy Kruse, RB’s menu trends columnist, says grocers are stepping up their game, and restaurants need to keep up.


So you are opening a restaurant in a Walmart? Good luck with that

The Bottom Line: The retail giant is adding regional restaurant chains to its stores, giving them some key exposure. But there are some real drawbacks to pay attention to.


More from our partners