How Farmers Adapted When They Lost Restaurants As Customers

CONTENT SOURCED FROM D MAGAZINE

Written By: EVE HILL-AGNUS 

The coronavirus shuttered your favorite restaurants or pushed them to takeout. That meant, immediately, a cataclysmic shift for the niche producers and purveyors who stocked their pantries and filled their kitchens. Now they want to fill your home kitchen.

There has never been a better time to emulate your favorite chef.

Below are three stories of what happened when restaurant sales collapsed and farmers, ranchers, and distributors had their businesses models upended overnight. Their futures were thrown into chaos. That didn’t stop them, though.

Profound Foods Reinvents Itself (Yet Again)

Jeff Bednar has always been nimble. Even before he entered the niche farming business, he was flipping houses in real estate—forward thinking, logical, a connoisseur of systems. Last year, I wrote about him as a linchpin at the center of a Dallas dining scene that was vibrant like never before.

Until two weeks ago, in greenhouses on his farm in Lucas—a tiny town located between Plano and McKinney—he was tending hydroponically grown edible greens and rare herbs for chefs, first as Profound Microfarms in 2016 and then as a microfarms distributor. Last year, he launched Profound Foods with a streamlined online ordering system and became a small-scale juggernaut connecting farmers, ranchers, and chefs.

His restaurant clients were mostly high-end. And while he knew he wasn’t as diversified as he’d like, he didn’t imagine the impetus for change would come from a virus. He didn’t foresee, he says, losing his business all at once.

Of his 130 restaurant customers, he was stripped to four. Losing all but a handful in the immediate wake of the March 16 coronavirus-related regulations against in-room dining made him somersault into a direct-retail model.

What this means concretely: he’s tearing out his bronze fennel bulbs and aromatic flowering agastache and replacing them with kale, celery, and other produce that will sell well to a consumer cooking at home (as in, perhaps not wanting shiso blossoms, but definitely tender red butterhead lettuce). A retooling of greenhouses and reduction by 70 percent was necessary to prepare to weather the storm and re-center operations.

The delivery vans and employees were already in place. It was a matter of adjusting the online system so home cooks could pick and choose products. Bednar counted 450 home delivery sign-ups in the first week. Fifty-five home deliveries at an average of $52 the first week ticked up to 92 deliveries at an average of $89 in the second. He brought on A Bar N Ranch (wagyu beef), Mill-King (dairy), and Empire Bread, which can accommodate the volume required for home deliveries.

Bednar also received an offer from Community Beer Company to move his headquarters and create a pick-up location at the ample Design District brewing facility. Dallas residents, therefore, will be happy to learn of an easily accessible pick-up opportunity.

Bednar is hopeful. The new model is intended to tide Profound Foods over until they’re able to reconnect with restaurants. He considered adopting a CSA (community supported agriculture) model, with a lump sum and ad hoc assortment per week or month. But he sees the home buyer wanting to support local farmers while also moving to purchasing online, with a premium on individual choice. He’s positioning himself at the nexus of both of those things.

Regalis Foods

Two weeks ago, they were vending Osetra caviar for chic restaurant set-ups and foie gras to be pan-seared and slipped across tables decked with fine linen and Christofle silver. Now, if you’d like, they’ll sell you high-end A5 Miyazake Japanese wagyu for the barbecue. The company that started six years ago in Dallas as Rare Edibles—and later joined with Regalis Foods to become Regalis Texas—now has branches in Dallas, Austin, Houston, Chicago, and New York and (until recently) accounts with high-end restaurants like Bullion and Georgie. Restaurants which no longer need Dover sole.

“Overnight, all of our restaurant sales evaporated,” says Regalis Texas manager Bryan Dunn. Overnight, they had to pivot from chef’s coats to the public. Nobody could dine in anymore.

Truffles, caviar, Berkshire pork; wagyu, oysters, and specialty cheeses; over 1,000 pounds of mushrooms and tens of thousands of dollars of impeccably sourced fresh fish—all immediately had to be offered at fire-sale prices. Dunn and his team precipitously regrouped and held a dock sale to liquidate inventory from their West Dallas warehouse, first to the restaurants that were left doing take-out, and then to the general public, which learned of the sales through the soft channels of social media and word-of-mouth.

Immediately, for Dunn and his team, the focus was on new streams of inventory for home cooks. They coaxed ready-to-sell packs of bacon and pork chops from their Berkshire pork source. A Bar N Ranch special-cut individually portioned steaks. Next will come individually portioned filets of fish. And high-quality loose-leaf teas to accompany the lobes of foie gras the average buyer can snag.

The dock sales transpired on a makeshift desk. Dunn says that as a result, they were able to lose (merely) 70 percent of their revenue, rather than the entirety.

But Dunn mourns the loss he sees up and down the supply chain. “We’re certainly going to lose some beloved and cherished artisanal cheese-makers,” he says of the implosion of the market. “Typically the nicer the product, the smaller the business it is. That’s the unfortunate thing.”

The micro-oyster company Cape Hatteras out of Virginia, for example, has millions of oyster seeds in the water, which may in a few months be lost, when they’ve grown to maturity, if they don’t have a market. “Fishermen have been hit very, very hard, as there’s been less demand for fish,” he says, as diners retreat to their home kitchens.

He is hoping to return to the market of chefs and restaurants—those that emerge after the storm. But he also looks to continue selling luxury items for home cooks through a membership structure. (The idea is to sustain until then, with pay cuts across the business.)

What will happen—whether home cooks will be cooking and sourcing like chefs after the storm clears—is uncertain. But Dunn admits to knowing there’s “a certain magic to shaving some truffles on a pasta at home. Or eating a jar of caviar on your couch.”

A magic a certain number of buyers can get behind.

“I don’t want to leave it to chance; I want to be here the day the restaurants re-open,” he says.

Chubby Dog Farm

Chubby Dog Farm had to pivot hard, too. The husband-and-wife hog ranching operation went from whole animals—heads and hocks and offal and blood and all, being used in award-winning boat noodle broth and boundary-pushing charcuterie—to retail-minded pork chops and tenderloins.

Knowing that the restaurant-centered relationships they’d tended over two years for their heritage-breed pigs–Mangalitsa crosses, Red Wattles, and Herefords–would no longer be tenable meant Calvin and Karyn Medders had to recalibrate.

The first thought was provisions. They bought four times the feed to have it handy to move safely through whatever came next. Then they donated large primals, the cuts too big to sell in a retail market: a loin and a head and several whole hams. The imperative was re-centering the operation on inventory that appeals to individual buyers, says Calvin, to “things that people at home would want.”

Calvin recently smoked 15 ham hocks, which he’s found to be a stretch for a home consumer. But the couple is hopeful. It would be nice if people fell in love with a long-braised hock or the decadent, melting luxury of the cheeks. It would be nice if the whole-animal model were preserved.

“The fact that [people are] cooking at home is really, really nice. But we really love that our chefs use all the parts,” says Karen. “We see them born,” she says of the hogs. They’d love to see them used.

What they need to bank on is that a new crop of cooks who want to know where their food comes from will emerge. When things settle, Karyn believes, habits will be formed—people hopefully “taking a little more time, shopping locally instead of ordering a box or just going to the store.”

Perhaps the coronavirus has introduced purveyors to a bold new consumer: the home cook, who wants to braise pork cheeks and eat caviar while sitting on their couch.

Further Reading

HOW NYC URBAN FARMS ARE PIVOTING TO STAY IN BUSINESS DURING COVID-19

WOMAN LED HYDROPONIC FARM IN DETROIT LOOKS TO CREATE FOOD SECURITY