Commercial Hydroponics: Disadvantages of Growing for Restaurants

Posted by Chris Michael on November 13, 2014

What are the possible reasons to NOT grow for restaurants in commercial hydroponics?

Find out in this video from Dr. Nate Storey.


Disadvantages of Growing for Restaurants Video

Video Transcript:

There are a few disadvantages to selling to restaurants, though, and these are things that you need to keep in mind. The chief among them is that these accounts have really high turnover rate. That means you may start an account and when the restaurant changes ownership or changes chefs or changes managers, you have to start back at square one. You have to keep that in mind. They can be great, high margin accounts, but they also have a really high turnover rate, which means you're doing more work just to keep the account in motion.

The other thing to remember is that it's not always a straightforward, clear cut hierarchy at these restaurants. When you go and talk to the chef they may be excited about your product but you not only have to sell the chef, but you also have to sell to the manager or the owner or whoever is in charge. Sometimes it's the chef, and that's a great situation, but a lot of the time you have to work your way up through the chain selling to multiple people just to get a relatively small account working for you.

Another thing is that the seasonality aspects of your business won't always mesh very well with the menus at these restaurants. Some of them will do seasonal menus so they reprint based on the season and the ingredients that they have on hand, but a lot of them want consistency in product throughout the year, which means you have to be producing year-round with consistency, not only the quality of your product but in the volumes of your product that you're producing. It also means that you have to be more invested in the growing process and making sure that your chef gets exactly what he needs year-round. That can be really tough for a first-time grower. These are a few disadvantages or drawbacks to working with local restaurants over other markets like CSAs or grocery stores.

Topics: Business

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