The drive-thru's worst enemy
Crain's Chicago Business
Ah, the plight of private-label manufacturers: They’re never lauded for the flakiness of their crusts or the cut of their garments because no one but their clients knows they’re making them.
But executives at Addison-based Great Kitchens Inc., which produces pizzas and appetizers sold as house brands at stores like Wal-Mart, Trader Joe’s and Meijer aren’t looking for consolation.
The company posted revenue of $84.2 million last year, up 62% from 2005-remarkable growth for a 20-year-old business that was stagnating just a few years ago.
Started by two cousins, Wayne and Paul Williams, and originally named Cousins Foods Ltd., the company changed its name to Great Kitchens when Arbor Investment, a Chicago private-equity firm that specializes in running mid-sized food and beverage operations, bought it in October 2004. Prior to the acquisition, Cousins Foods had lost its focus, says operating partner Dennis Malchow, who took over as CEO.
“It was changing constantly, doing anything that would come its way, from making pizzas to making meatballs,” he says.
Mr. Malchow limited the compnay’s product lines to pizza and appetizers and convinced existing customers to offer “take and bake” versions of these products at their stores. Take-and-bake meals are fully prepared, unheated dishes that consumers can buy at a grocery store and cook at home. They are popular in Europe, but just catching on in the united states, as more shoppers head to grocery stores, rather than restaurants, for takeout.
Great Kitchens take-and-bake sales have been so brisk that the company has been able to build a 141,000-square-foot facility in Romeoville. When the plant opens in January 2008, the company expects to improve efficiency by having its test kitchen, manufacturing operation, sales department and most of its storage facilities under one roof.
They’ll need that extra space, Mr. Malchow says. Great Kitchens in in discussions to supply food to british grocery chain Tesco PLC, a pioneer of take-and-bake products that is planning to enter the American market in a few years.
“We can also start to penetrate other areas within our existing stores because they see we do well,” sats Mr. Malchow, citing Great Kitchen’s savory tart with Gruyere, carmelized onions and ham one of Trader Joe’s most popular appetizers. “We haven’t even touched the freezer.”
COPYRIGHT 2007 Crain Communications, Inc.