Marketing Fresh Produce to Restaurants
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University of Kentucky CCD Home CCD Crop Profiles College of Agriculture, Food and Environment
Marketing Fresh
Produce to Restaurants
Introduction
A 2006 survey of Kentucky restaurateurs revealed
substantial interest from restaurants across the
state in purchasing typical local products such
as tomatoes, bell peppers, greens, and melons.1
The same survey also documented interest in
sourcing less widely cultivated crops, such as
shiitake mushrooms, asparagus, herbs, berries, willing to develop a personal relationship with
and table grapes. Restaurateur and chef interest the restaurant and shows an interest in producing
in serving locally grown cuisine was one of excellent food. While many chefs say they
the most commonly documented trends in the believe that locally sourced produce is of higher
American restaurant industry during the 2000s. quality and safer than non-local produce, growers
marketing to restaurants must take every care to
Three general reasons for purchasing locally maintain the safety of the food they deliver.
grown produce commonly given by chefs
include:2 A greater focus on local food appears to be a
• Locally grown foods are fresher and have a lasting trend across the foodservice industry for
higher or better quality the 2010s. Produce growers wanting to explore
• Customers have requested local products, the restaurant market will need to:
especially after the restaurant has previously • Develop relationships with chefs
carried local foods for a period of time • Understand the effects of pricing on their
• Unique or specialty products are available financial returns
locally • Manage potential risks from a new or
developing market channel
Many chefs interviewed for a 2009 producer • Prove their reliability by offering consistent
training curriculum for restaurant marketing also product quality and superior service to chefs
viewed locally produced items as being safer and restaurants
than those purchased from traditional wholesale
channels. The chefs surveyed frequently cited Relationships
a greater trust for produce that is grown locally A key for marketing produce at any level is
— even if the chef has never developing a good relationship
set foot on the farm where the with the customer. When
produce was grown. Chefs also selling to a local restaurant, it
tend to trust a grower who is is critical that you get to know
Agriculture & Natural Resources • Family & Consumer Sciences • 4-H/Youth Development • Community & Economic Development
Educational programs of the Kentucky Cooperative Extension Service serve all people regardless of race, color, age, sex, religion, disability, or national origin.
• Providing additional information about your
farm, production practices, and/or products
through communication channels requested
by the chefs. Common methods used for
communication are farm Web sites, e-mail,
Web-based social networks, mobile phones/
voicemail, and direct e-mailed price lists.
Returns
Local producers can sometimes demand a
premium above the wholesale prices that
restaurants usually pay for produce. These
premiums commonly range from 5% to 25% (and
sometimes more) above the current wholesale
market price. Specialty or hard-to-find items may
the person who will be buying and using your be grown locally at a lower cost and that savings
products. This is most often the restaurant’s may be passed on to wholesale customers. In
chef, but it might also be the business manager, general, chefs are often willing to pay a little
kitchen manager, owner, or even a pastry chef. more than wholesale for high-quality, reliable
local produce.
You may already know a restaurant’s chef or
personnel from your local community. If you Producers should realize, however, that selling
are approaching a restaurant with which you to restaurants is a wholesale market; retail prices
are unfamiliar, always remember that you are a (such as those received at a farmers market) are
salesman for your farm’s products. Strategies that usually unrealistic to expect from restaurants. It
help begin a sales relationship with a restaurant is important to understand the wholesale prices
include: that restaurants are accustomed to paying for
• Dressing professionally and presenting produce. Growers can find links to various price
yourself honestly reports at the USDA Fruit and Vegetable Market
• Making an appointment at a time when the News Web site.
chef is not busy
• Finding out as much as possible about There may be additional costs affiliated with
the restaurant before you visit — signature marketing to restaurants. Growers that are
dishes, target clientele, awards won, chef’s spending extra time preparing a product
background, and education, etc. specifically to a chef’s specifications should set
• Developing a neat and professional handout a price that accounts for their extra production
or brochure about your farm/market garden time. Another “hidden cost” can include the
that describes you and your products expenses of time and fuel required in delivering
• Bringing samples of your produce for the the produce to the restaurant. A properly prepared
chef to taste or prepare production budget will help a grower determine
• Making sure the chef knows when and how if additional profits from selling to restaurants
to contact you cover the additional costs of delivery. In less
• Asking the chef or restaurant manager what common instances, smaller restaurants may be
the best ways are to contact him/her in the willing to pick up produce when a grower is in
future town at a farmers market.
There can be non-financial returns for understand that producers can encounter disease,
growers selling to local restaurants. Some bad weather, or other production problems; it
establishments, including Kentucky’s state is just critical that growers take the initiative to
resort park restaurants, may feature the name of notify the restaurant as soon as they are aware of
the farm or grower who supplied certain items a problem.
on their menu, thus providing free advertising.
Producers who establish good relationships with Another risk for producers is slow customer
chefs may find that they are able to generate payment. Some restaurants will pay monthly;
additional sales. For example, the chef others pay on delivery.
may be willing to purchase lower-grade When Kentucky’s state
produce for soups, sauces, salsas, and resort park restaurants
other processed foods. started purchasing produce
directly from farmers in
Some restaurants may demand highly 2004, they advertised
perishable specialty crops. High-end payment within a week.
restaurants are sometimes willing to Producers may reduce
pay whatever it takes for a producer to the risk of slow or default
deliver hard-to-find specialty produce. A payments by having a well-
producer may find that offering a product organized invoicing system
a restaurant cannot get anywhere else and keeping all accounts
is a good way to build new markets. current. Both the seller
Growers marketing to restaurants may and the buyer should have
need to adapt their production system a clear understanding at
and products to supply exactly what the the start of the season
chefs are looking for. regarding how payments
will be handled. In some cases, a simple contract
Squash blossoms and other edible flowers, or written agreement may prove an effective tool
pawpaws, specialty peppers, organically grown for both the restaurant and the grower.
vegetables, raspberries, shiitake mushrooms,
and heirloom tomatoes are examples of specialty Certain customers may request a grower carry
crops that have been successfully marketed to product liability insurance (PLI). Others may
restaurants by Kentucky producers. presume the grower is insured for product
liability. PLI, which usually costs a few hundred
Risks dollars for $1 to $2 million in liability protection,
The most significant risk when marketing to local is one of the most comprehensive means available
restaurants is losing the customer by repeatedly for protecting yourself from potential product
failing to deliver on time or delivering poor liability when selling to foodservice institutions.
quality product. A grower simply cannot deliver
an inferior product to the chef, who is often Reliability
purchasing the product for its quality. Similarly, Selling Your Produce
you need to realize that chefs are depending on Selling to restaurants can be both personally and
you to deliver products when you say you will. financially rewarding for growers. Marketing to
Failure to communicate with chefs about delays local restaurants also offers growers the opportunity
in delivery can result in the loss of a customer. to develop their direct marketing skills, perhaps
leading to other market opportunities. To
Fortunately, many chefs understand the risks emphasize our previous points, the two most
of producing high-quality produce. Chefs may important factors for successful produce sales
to restaurants are it is realistic to expect a restaurant client to pay
(1) growing high- you that frequently.
quality, tasty crops
and (2) growing Suggestions for New Products
good relationships Once you have established sound relationships
with chefs. with your customers, they will be more likely
to consider purchasing new products or services
Servicing Your from you. For example, showing a restaurant
Product that you can deliver consistently fresh tomatoes
“Servicing” your may make them open to trying a higher-priced
product can be as heirloom variety.
simple as keeping
in regular contact Producer Networking
with the chef, or You may know other producers that offer crops
whoever makes you do not. Suggesting these suppliers to a
the purchasing restaurateur may help them serve up even more
decisions. In addition to their scheduled delivery local options. Be sure to recommend growers
time, most growers who successfully market to that you are confident will not try to undercut
restaurants are in contact with the chef at least you or sell produce you are already supplying.
once more per week. Below are other ways If there is the opportunity for you to coordinate
growers can “service” produce they have grown. the transport of these products in a consolidated
delivery or at a single time, investigate those
Provide Product and Seasonal Updates options. Chefs and restaurants tend to be
Restaurants may not only purchase your product favorable to receiving more products in fewer
because of its superior quality, but also because deliveries. Some producers have even added
offering locally grown products is attractive profit to their existing restaurant marketing by
to customers. Providing news about how the charging other growers a reasonable fee for
produce is grown and how the season is going can delivering their produce to restaurant clients at
provide the restaurant with information useful to the same time as their own products.
marketing its food. It can also help you keep a
good marketing relationship going in the face MarketReady Training
of extraordinary weather or pest problems that Producers who are considering or developing
might interrupt your planned harvest schedule. a market to restaurants can obtain valuable
instruction through the University of Kentucky
Good Business Practices Food Systems Innovation Center’s MarketReady
Restaurants will appreciate your providing Training Program. Those already selling product
a simple method of billing. Use consistent, to restaurants will have an opportunity to explore
straightforward invoices. If the restaurant has ways to improve and expand their business. The
the option to pay you by direct deposit using unit on restaurant sales includes a panel of chefs
an electronic fund transfer, this will save them and restaurant buyers. Issues such as food safety,
the expense of delivering you the check — and insurance, pricing, invoicing, storage, product
could result in quicker payment for you. Some quality, and traceability risks are addressed
restaurants may also be interested in using third- during this unique training opportunity. For
party payment services (such as PayPal) that are more information about the program, as well as
readily available to producers. Restaurants are training locations and dates, visit MarketReady
used to paying wholesale vendors monthly, so on the Web.Selected Resources • Local Food Connections From Farms to
• Food Systems Innovation Center (University Restaurants (Iowa State University, Revised
of Kentucky) May 2008)
http://www.uky.edu/fsic/index.php http://www.extension.iastate.edu/Publications/
• Kentucky MarketMaker PM1853B.pdf
http://www.marketmakerky.com • Selling Directly to Restaurants and Retailers
• Kentucky Proud (Kentucky Department of (University of California SARE, 2003)
Agriculture) http://www.sarep.ucdavis.edu/sfs/files/selldirect.
http://www.kyproud.com/ pdf
• Kentucky Restaurant Produce Buyer Survey • Selling Directly to Restaurants (University of
(University of Kentucky, 2006) Wisconsin, 2005)
http://www.uky.edu/Ag/cdbrec/restaurantsurvey. http://www.mosesorganic.org/attachments/
pdf productioninfo/uwrestaurants.pdf
• MarketReady (University of Kentucky) • Selling to Restaurants (ATTRA, 2004)
http://www.uky.edu/fsic/marketready/index.php https://attra.ncat.org/attra-pub/summaries/
• ABCs of Marketing to Restaurants (Rodale summary.php?pub=266
Institute) • Tips for Selling to Restaurants (ATTRA, 2012)
http://newfarm.rodaleinstitute.org/features/0802/ https://attra.ncat.org/attra-pub/summaries/
restaurant.shtml summary.php?pub=388
• Approaching Foodservice Establishments
With Locally Grown Products (University of
Nebraska-Lincoln, 2003) 1 Woods, Tim, Matthew Ernst, and Jeffrey Herrington.
http://digitalcommons.unl.edu/cgi/viewcontent. “2006 Kentucky Restaurant Produce Buyer Survey.”
cgi?article=1000&context=fpcreports http://www.uky.edu/Ag/cdbrec/restaurantsurvey.pdf
• Direct Marketing (ATTRA, 1999) 2 Zumwalt, Brad. 2003. “Approaching Foodservice
https://attra.ncat.org/attra-pub/summaries/ Establishments With Locally Grown Products.” Food
summary.php?pub=263 Processing Center, Institute of Agriculture and Natural
• Fruit and Vegetable Market News (USDA Resources, University of Nebraska-Lincoln. p. 4.
Agricultural Marketing Service) http://digitalcommons.unl.edu/cgi/viewcontent.cgi?article
=1000&context=fpcreports
http://www.marketnews.usda.gov/portal/fv
Prepared by Matt Ernst & Tim Woods (tawoods@uky.edu) UK Department of Agricultural Economics
400 Charles E. Barnhart Building, Lexington, KY, 40546-0276 Phone 859-257-5762
http://www.ca.uky.edu/agecon/index.php (Issued 2005; Revised 2010; Revised 2011)
Photos by Matt Barton, UK Agricultural Communications Services (p. 2);
Scott Bauer, USDA-ARS (p. 1); Peggy Greb, USDA-ARS (pp. 3 & 4) March 2011You can also read
