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Small, independent restaurants may prefer local sourcing, but eventually broadline partnerships become key to driving growth.

Local Versus Broadline: How Should Your Restaurant Source Ingredients

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When do growing chains with sensibilities make the move to broadline distributors?
By Daniel P. Smith July 2018 Finance

When John Plew opened his first Thirsty Lion Gastropub & Grill near Portland, Oregon in 2006, it was relatively straightforward for him to maintain relationships with local suppliers and tap into consumers’ growing appetite for local food and drink.

When he opened his second unit in Portland’s metro area four years later, Plew continued sourcing local craft beers and wines, fish and beef, cheeses and produce, happily leveraging the Pacific Northwest’s rich culinary offerings.

But things got tricky when Plew took his high-volume, scratch-cooking concept 1,300 miles away to Tempe, Arizona, in 2012.

With that move, honoring the locavore movement became dicier. Plew found wide-varying differences in the quality of local goods available between the two markets, particularly cheeses and meats. When he did find products comparable in quality, subtle distinctions between the goods sometimes made it difficult to dial in recipes and achieve consistency.

“[Sourcing locally] is scalable when you’re in a local market, but much tougher to do with geographic expansion,” Plew says.

Searching for other purchasing options for his growing restaurant enterprise—soon to be nine Thirsty Lion units spread across four states—Plew investigated a group he hadn’t much considered before: broadline distributors. Now national suppliers stand a key partner to his business and a cost-effective, one-stop shop for a number of goods.

“We get the best of local whenever we can and then backfill with regional or national, including getting some items like bread from a national account,” says Plew, who is also involved in a purchasing cooperative to gain additional financial savings.

Plew’s delicate sourcing dance isn’t uncommon. For full-service concepts embracing a “locavore” feel, something often central to their original identity, the ability to purchase local goods grows increasingly more complex with the addition of new units and geographic expansion. While some tightly hold onto their buy-local sensibilities, juggling an array of distinct relationships across product and state lines, others have turned to broadline distributors in an effort to drive consistency, simplicity, and the bottom line. After all, there can be significant financial benefits to ordering more from a single supplier.

According to NPD SupplyTrack, micro-chains—defined by the NPD Group as concepts with three to 19 units—increased cases ordered and dollar spend with broadline foodservice distributors by 5 and 8 percent, respectively, between 2017 and 2018.

“The typical independent restaurant with one or two units can go local with product specialists, but this all becomes more challenging with growth,” NPD SupplyTrack vice president Annie Roberts says of the uptick in broadline orders across the industry.

That’s why Roberts believes many emerging restaurant chains carefully pick their sourcing battles and corral goods from a combination of suppliers, an approach Plew practices at the Thirsty Lion.

While Plew has moved to a broadline distributor for bread and other select commodities, he continues favoring local suppliers for meat and produce. At the bar, he prioritizes local craft beer, wine, and distilled spirits as much as possible, though he won’t force a decision to simply check the local box.

“Quality is always the priority,” Plew says, noting that he’s often chosen the flagship Stella Artois pilsner because of its quality edge over many local pilsners.

Most often, Roberts says, growing concepts turn to broadline distributors for consistency and convenience. Many broadline distributors will guarantee specifications on goods and deliver to multiple locations, something many local providers struggle to match.

“If the restaurant is big enough for a drop, broadliners will pull up the truck,” Roberts says.

As the Thirsty Lion has grown, Plew has stepped closer to national accounts but continues to look local first, especially if the restaurant can get a lift from a credible local brand. Even still, that’s led to tough choices.

“The question we consistently face is if it’s better for us to have local goods or purchasing power and, in some cases, the answer can vary,” Plew says.