How to Grow Your Catering Business with a Virtual Restaurant: Tips from Kyle Feggins [Podcast]

How to Grow Your Catering Business with a Virtual Restaurant: Tips from Kyle Feggins [Podcast]


Welcome to the Catering Feed. The
catering growth podcast show about growing your catering business and
restaurant industry trends powered by ezCater. Hi everyone, welcome to the
catering feed. This is Genevieve Babineaux your host and I’m really
excited today to be in the studio with Kyle Feggins. He”s the CEO and founder of
Iron Horse Cafe and we are so excited to talk to him today about virtual brands.
Hi Kyle how are you? Pretty good. How are you doing today Genevieve? I’m doing so well
and one of the reasons that we wanted Kyle to come on the podcast, he has an
incredible background, he’s a really innovative leader, and he went from
working really closely with some great chains, helping them grow early in their
catering journey, and now has taken this great new adventure to start his own
business. He’s an entrepreneur and he’s thinking really innovatively and
strategically about the catering world. So Kyle we are so excited for you to dig
in on this topic with us. Yeah absolutely. Um you know I’ve been in the I guess
hospitality industry my entire life. I started working with my grandfather and
his catering company before I could probably even remember to be able to
tell you. From that point on you know I went out I got two different culinary
arts degrees, one from Scottsdale culinary and another one from Penn State.
Ym and from there I built a couple really cool catering programs for really
cool brands here in New York. Iron Horse Cafe has been a dream
of mine since I was a young boy. Obviously I think that the hospitality
industry has always been in my blood and I’ve always wanted to own my own you
know restaurant. But after working for several chains and realizing the
possibilities of growing not just one unit, becoming a multi-unit operator, it was just it was a dream that I couldn’t leave behind. That’s really exciting. As
you were starting to build out the strategy for this new brand how early
did you realize that catering was gonna play a large role in your strategy? From
day one we were trying to do catering. When we initially contacted our printers
we were already designing stickers for our wraps and for our salads and for our
hot food. Times have changed from the olden days right? I
think that when you’re launching a new brand or a new concept or even you’re
just opening another location, whether it’s in the same city, or a different
city within your you know I guess your brand, you have to think about external
programs. How do we go to the next level with you know market saturation and you
know third-party delivery? How do we get there?
As you were growing your catering program, I know that you found that
was fueling your brick and mortar, but how did you start to think about growth
differently as the digital markets emerged? So you know we looked at the
popular winning menu items and we realized that we could take parts of our
menu that are the most popular sections and turn them into their own entities or
their own digital marketplaces. It’s really interesting because when that
goal is so often how do I get another unit, another unit? I think growth has for
a long time been seen just by real estate, versus now your digital footprint
becomes an extension of that real estate. Absolutely you know for me I feel like I
own five separate restaurants and sometimes the sales match that feeling
and sometimes they don’t. But you know it’s funny when I look at each menu or
when I look at each entity there, they are their own separate brand. My smoothie
bar is different than my salad restaurant, which is different than my
burger restaurant, which is different than my main brand Iron Horse Cafe. Do
you think that having virtual brands or restaurants allows you to address
certain day part concerns? Is that something that you would recommend
leaders think about where their saturation is? Where they potentially
could use additional lifts and consider virtual restaurants as a way to offset
that? You know Gen, I honestly think that that was the main concern or main focal
point of us moving forward with with our virtual restaurants. Super popular menu
items was a big factor as well, but there are different serving times, or different
periods of the date where you’re lacking in sales and where you know what a
burger may not sell, but a smoothie bar or a slice of avocado toast will. So if
there were listeners out there who have been considering the same thing but
maybe have been hesitant to take this leap what would your advice be for those
thinking about opening a virtual location? You know some may disagree with
me but I really truthfully think that the
first thing you have to do is take a look at your menu. You have to make
educated choices on what sections or what products to base your new virtual
brand or virtual restaurant around. For me we needed to keep costs very low
while still earning the same amount of money if not more. And I just wanted to
stress to my guys that the cross utilization of the menu items that
we picked together had to be flawless. Meaning we couldn’t bring in any
additional SKUs or any different products, we had to use what we had in
house. I looked at it as if we had to bring in additional products we were
adding cost to our cost of goods, we were carrying different products that we
didn’t need, and ultimately taking up a lot of space on a restaurant. The cross
utilization is paramount to success with these virtual restaurants. Physical
capacity is such a huge topic in the industry especially you at least have
the luxury of building your brick-and-mortar knowing that you were
really excited about catering. But for so many folks they have a lot of very
limited space and so I think it’s really great the way you were considering how
do you expand without necessarily making things more complicated. So I think with
physical capacity right, I think that you have to plan everything right? It has to
be from the team members, to the menu items, to the timing to staffing in the
store, to overlap and staffing for cleanings. I think you have to think
about the workflow more than anything right. So for example in the past what
I’ve done is I had a five person team that operated the actual restaurant
right? That same five person team rather than coming to work at 6:00 started to
come to work at 5:00. This way they could get all of the catering and have the
restaurant cleaned by 10:00 a.m. when we opened at 10:30. Now for the most part
maybe we were lucky or maybe it was just the clients that we were going after, but
all of our catering orders whether they were lunch, breakfast, or dinner they
were done by 10:30. Now we still may need to cook off a certain you know certain
different products and you have to change and adapt that we were just
talking about I think that physical capacity plays less of a role when
everything is planned. How do you scale that off premises
business without disrupting that existing brick-and-mortar? So you were
saying that usually open it at 10:30 has that ever become an issue where the
sales were just so high that suddenly your brick-and-mortar business started
your dining business started to struggle? So you know we haven’t had that problem
where our dining sales started to struggle or the operations started to
fall. I think you know I’m gonna bounce it back to the same word, it’s planning.
You know the workflow has to be flawless. Timing is key, knowing your staff, and
finding the employees that will push the boundaries with you is key. I think that
the staff has to own everything that you try to do in your restaurant because
ultimately they’re the driving force behind your success. My dad used to
always say proper prior planning prevents piss-poor performance.
Wow I like that and I keep hearing you talk about planning and analyzing the
data and really investing in staffing, And I think sometimes people want to
grow but it is a big leap to take that investment in additional staffing or
pump up your labor so that you can still serve that same experience. Absolutely,
but you know what I think that too often operators are scared of the dark. They
don’t know what lies ahead and too often they think that they have to pick one or
the other. That’s either we’re gonna do in-store sales and focus really hard on
in-store sales and forget catering or we’re gonna do catering and whatever
happens happens. You know sometimes I guess that could be the right approach
for certain people, but for me it’s not. I think that from day one you have to know
that you’re going to (a) need external programs and (b) you know
you want to reach the masses from day one. You want people to say wow their
delivery program or the catering program was so good I have to go check out the
inside of the restaurant and see what’s going on. I need to see the ambiance and
I need to see whatever this show or whatever story that particular
restaurant is telling. Iron Horse is the core brand under this a masterpiece
umbrella that you’re creating. Yes it is how have you seen growth occur since you
started to expand Iron Horses presence on the internet? So sales have tripled
actually. Um and again I want to remind you these are coming from separate four
separate entities right we may be using the same existing product and we may be
just cross utilizing our base menu or our Foundation menu. You know brick and
mortar is here to stay right so I think a really easy way to
increase sales or maybe not even increase sales maybe just track and test
different methods is to use these virtual marketplaces. It seems like your
initial advice is that operators should look at their current menu offering, see
what’s performing really well, and consider elevating that to its own brand.
Once you find success doing that with your current offering, what would your
advice be if people are looking to test and track new menu offerings. Um so I
think seasonality is really huge right? I think when testing any new menu item you
have to go through the you know the proper steps. You know you want to try a
couple of different styles of preparation. You want to get feedback
from your most trusted clients or staff. I think you treat it as any new menu
offering right? You don’t change or shortchange anything just because it’s a
virtual restaurant and all the costs aren’t there. You just want to reap all
the benefits. As you’re thinking not just about your own workflow and your own
partnerships but starting to put your product and brand on the hands of third
parties, what are your insights on choosing the right third party to be
that great representation of everything that you’ve worked towards? Anyone who
knows me knows that I’m willing to test or try you know anything at least one
time. I think that without testing something or without actually seeing
with the brands offer unless you know off the bat that something doesn’t fit
your you know your protocol or your repertoire, I think that you need to kind
of see which each third party or delivery you know marketplace offers one
can be very different than the other. I think that it’s really important to find
some unity in them if you’re going to operate multiple you can’t have your
kitchen receive orders from different you know third party vendors in
different ways.

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