The Journey To World-Class Foodservice

The right resources, constant innovation and a freshly prepared food image keep Rutter's Farm Stores ahead of the foodservice curve

Walking into a typical Rutter's convenience store, customers are greeted with up to 5,800 square feet of offerings, of which nearly 25 percent is dedicated to foodservice. Whether ordering up one of the chain's newest menu items, including a walking taco and snack wrap, or one of its on-site, freshly baked biscuits and muffins, customers can watch as their order is prepared in four minutes or less.

"I placed a four-minute time limit on any item to be ordered and prepared," said Jerry Weiner, vice president of foodservice at York, Pa.-based Rutter's Farm Stores, which operates 57 locations. "In the c-store, we are up against a perception issue. If you ask a customer on line at McDonald's how long they waited, and it was actually 10 minutes, they would say five. But if it was a c-store, they would wait five minutes and say it was 10."

Rutter's newest prototype store, which had its last major overhaul in 2007, allows customers to watch the food preparation process, whether it's baking bread, assembling a sandwich or using a wok to cook a stir-fry dinner. This allows the chain to drive home the freshly made image to the customer, since nothing is made in the back room, said Weiner. That is used for storage only.

"This allows us to offer theater, especially the wok. If we are going to tell people we are giving them fresh food and it's made to order, watching it happen really drives it home," he explained. "They can even watch breads, cookies and muffins being baked. It drives home the image, and really separates us from the competition."

So, how did a c-store chain that started as a dairy business evolve to the high level of food-service success it is achieving today? Believe it or not, it all started with ice cream.

LOOKING BACK

Rutter's made its mark in the dairy business starting in 1921. By the 1940s, the company ventured into ice cream dipping with ice cream parlors at its dairy stores, which also offered a small array of c-store products. It wasn't until the late '60s and early '70s that the chain opened its first convenience store, offering roller grill items, dipped ice cream and sandwiches — both pre-made and built to order.

"We had a deli case with pre-made sandwiches wrapped in cellophane, but customers could also request a fresh sandwich," recalled Scott Hartman, president and CEO of Rutter's. "We were also well-known for our Italian subs."

While the stores always offered coffee, in the early days, it was only a single glass pot and one coffeemaker. The chain eventually added more coffeemakers, but this segment didn't really skyrocket until the 1990s — or what Hartman called "the early Starbucks years." At this point, the chain introduced higher-end coffees and coffee drinks, and the fountain area saw the same evolution — going from a four-head fountain machine up to 12 heads in some stores.

Additionally, in the '80s and early '90s, Rutter's owned and operated a chain of six full-size family restaurants that seated up to 150 people. However, it was difficult to operate a restaurant chain of that size and compete against both national chains and the single-location, family-owned restaurants in the area, said Hartman. The chain also didn't have a liquor license, so no beer or wine could be served at the restaurants. Eventually, by the year 2000, the company sold off all the locations.

At one point, Rutter's also tried to incorporate branded foodservice chains into its stores, including Pizza Hut and Little Caesars, but eventually pulled out of the concept. "We tried one Little Caesars, had about 10 Pizza Huts and an A&W, but we thought we could do it better ourselves with less obstacles," Hartman said.

Over the last seven years, the company focused on bringing all of its brands back to Rutter's, including gasoline and its own proprietary sandwich line then called Famous Express. "When going through the branded stage of our life, we had one quarter of the stores with branded gas, and when it came down to it, our customers viewed Rutter's as the brand and the value of the others wasn't translating to the customer," noted Hartman.

This applied to the company's Famous Express brand, too, which he said customers didn't even realize belonged to Rutter's. "We did focus groups and talked to customers, and the other brands didn't add any ancillary value, so why were we trying to create a sub brand when they all just think it's Rutter's?" he said.

GROWING THE CATEGORY

By 1997, in order to expand and compete in the foodservice arena at its c-stores, the company knew it had to devote someone to the category on a full-time basis. Hartman created a new position and hired Weiner, who had started his foodservice career in 1972 at 7-Eleven Inc., helping to grow its deli business. His experience also included a stint as director of food and beverage at Marriott, and right before he started at Rutter's, he worked for Crown Petroleum in Virginia.

"At the time, we were designing the first of what we termed 'super stores,' taking us from 3,200 square feet to close to 5,000 square feet, and it became evident that the amount of foodservice we were putting into the stores required us to devote someone full-time to the category," Hartman explained.

When Weiner joined Rutter's, his main goal was to develop a program, theme and structure around the category to be offered in all of its stores and generate profit, he recalled. The company had just rolled out a new prototype and had three stores featuring the design and layout, so this is where he began to test his ideas.

"I used the first three stores as a laboratory where we got the systems down, including recipes, procedures and manuals, so employees would have something to go by and be trained with," Weiner said.

These stores offered a food counter where customers could order a sandwich, but all the food was cold. Weiner immediately put in a hot foods program, starting with breakfast, including fresh breakfast sandwiches. He also switched up the foodservice equipment to "create a flow that lent toward speed," and added holding equipment to keep the food hot so products could be prepared to order.

Next, he introduced a hot lunch program with a cheesesteak as the first sandwich offering. "How do you have a chain in Pennsylvania without a cheesesteak?" he asked. This eventually extended to a more substantial menu of items, including burgers, meatball subs and other hot foods such as macaroni and cheese and chicken dishes. Rutter's also delved deeper into hot and cold grab-and-go products and started taking "verbal orders," setting up a speed line to increase speed of service.

As the company built new stores, these changes — including the new equipment — became standard. But it was at least four years before the chain began looking at remodeling existing stores to get the new foodservice program into them, delivering the same menu in a smaller format.

"We tried to see how we could take an older store design and update it to have the look of a new store on a smaller scale," Weiner said. "It took some creativity because we were building 4,000-plus-square-foot stores, and the old design was 2,800 square feet."

The older stores still offered an eight-foot deli case, but the team was able to change the flow pattern of the store and upgrade the coffee and fountain programs to enhance the overall foodservice image, he noted. "We didn't just take the corner of the store and put in a food program," he said. "We literally gutted the store. The idea was to have customers walk in and think they were in one of our new stores."

The upgraded coffee and fountain program started in the three test stores, and as other locations were remodeled, the team retrofitted the programs into existing stores. While all of the locations already offered glass coffee pot systems and grinded their own beans, there were only three different coffee products offered — regular, decaf and Columbian. With its current program, the stores now brew eight varieties 24 hours a day, and offer customers a wide array of dairy creamers and milk, as well as sweeteners, sugars and syrups.

"We work with a vendor in terms of production, but the product is our brand," said Weiner, explaining that they tested a full coffee bar years ago, but it didn't work out. "However, we do have some new things in the works," he hinted.

The fountain also increased in size from four- and six-valve machines to between 10 and 16 valves, and up to four flavor shots. Four valves are proprietary drinks and the other 12 are a dual cola program, he said. Also, in 2008, the chain began to brew iced coffee and fresh brewed iced tea.

"In addition to the hot coffee program, we also offer four flavors of fresh brewed hot tea," Weiner added.

Prior to the changes made when he arrived, each store had a deli manager in charge of foodservice. Now, each store with the extensive foodservice program has a "restaurant manager" to manage the foodservice side of the store. These employees hire and schedule their own staff and report to the store manager, said Hartman. Also, every employee is cross-trained to handle the c-store side as well.

"We started with deli managers in the '90s because we realized the store manager really had two sides of the store to handle and needed help," Hartman noted. "Now we have seating in the stores, so we have 20 employees or more handling the foodservice."

As time went on, Weiner developed more products and added them to the menu, but the next major leap came with the retailer's new prototype in 2007. This is the concept being built today, and it's brought the foodservice section up to a new level.

"Every five years, we go through a morphing of foodservice, but we build new stores every year, so we do some level of change each year," Hartman explained. "We look back and say, 'What would we do differently from the prior year?' So, we do some tweaking along the way."

These changes could be to the size of the store, the way the seating is positioned or the way the design looks. "It could be the introduction of skylights and television screens in the seating area, or even format changes to the gas pumps," he noted.

THE LATEST EVOLUTION

With its newest prototype, Rutter's launched a proprietary grill program. The biggest change, though, came when Hartman and his team visited stores in Ireland and discovered a wok program at a Euro Spar location.

"I take my team outside of the country for visits every couple of years to see best-in-class stores. We were in Dublin when I saw the wok inside a Euro Spar. It really attracted us because of the way they used it and the show factor," said Hartman.

The team researched it and copied it for their stores. A couple of years later, Hartman presented at a conference in London and told the story about his trip to Ireland and the wok. After he spoke, the CEO of Spar came up to him and revealed that he actually took the idea from a Wegmans grocery store.

"The idea actually came out of our own backyard," said Hartman. "He told me Wegmans took it from somewhere in Asia, so we laughed about how these new ideas really travel the globe."

In addition to the wok, Rutter's upgraded stores to a high-speed oven and added fryers to its locations, which Weiner said allows them to produce almost any food imaginable. The high-speed oven allows the stores to bake its own cookies, bread, biscuits, muffins, ciabatta rolls and sub rolls fresh on-site.

"The fryers brought us into producing more, and the wok allowed us to provide theater and drive the fresh-made image home to the customer, which is our theme," Weiner said.

The wok also allowed the chain to offer stir-fry meals, and Weiner introduced a conductive heat system, which he believes is the "kitchen of the future." From the environmental and utilities side, the store doesn't need to leave the heat on all day, and the system heats up in an instant.

"It gets hot fast and cooks the food quickly," he said. "The pan is hot, but everything else is cool, which also gave us a safety feature where an employee could cook without dealing with the dangerous side of using a wok."

Weiner found a company in California to supply the food items needed to create a stir-fry, and then worked to develop a system allowing employees to produce meals using a wok in a four-minute time limit. This is where the conductive heat system played a big part.

"The conductive heat is so fast that we can freshly stir-fry vegetables in the wok as a customer orders it, add whatever meat and sauce, and then the heat is turned off and the mixture is poured over whatever carbohydrate they ask for," Weiner explained. "That went out in a bowl with a pair of chopsticks and a fortune cookie, and that is what started us on our way."

Once they had a wok in the kitchen, Weiner began to introduce new recipes for it, including a breakfast bowl with eggs over hash browns, meatloaf and spaghetti, pot roast and chicken and gravy.

The first version of the newest prototype store and upgraded foodservice system opened in February 2008. Today, there are 16 stores with the program, and No. 17 is currently under construction. However, the overall foodservice menu is offered in all stores, minus the wok.

When the new program was first introduced, Rutter's sent out four trainers to certify every store and restaurant manager in the new program, as well as the National Restaurant Association's ServSafe program, which ensures all employees are taught and exposed to the proper handling of food and food safety.

"Food safety is a critical part of our business, and we take it very seriously," said Weiner.

As far as the current menu, it is continually evolving, although limited-time-only items are rare, he said. Twice per year, Weiner personally reviews every item sold; it has to hit certain sales criteria in order to stay on the menu. Throughout the year, he continues to roll out new offerings — at least every two to three months.

The company recently rolled out a new walking taco, which is another means of separating itself from the competition, according to Weiner. The taco can be completely customized to a person's taste profile, and is popular at local sporting events.

"Someone told me about it and I asked what was in it," he said. "Basically it's crushed up chips, nacho style, with taco meat. It's a taco crushed up so you can eat it with a fork, but what separates us from the sporting events is that we can offer nine different options that people can add to it."

As of press time, Weiner planned to introduce another new item in five weeks, with a second to follow seven weeks later. "Sometimes, I test an item in a small group of stores where I get the procedures and methods ironed out, and then I'll push it to a larger group and then chainwide," he said.

Other big hits on the menu include sliders, for which the company bakes its own slider rolls on-site as well as sloppy joes. And one item Weiner introduced with the intention of pulling it soon after became an unlikely staple.

"When I first put in the new program, I picked a fried pickle as an appetizer because I thought it would get people talking about it," he said. "I figured I would pull it out after six months, but it is still a very popular item."

Rutter's is now in its third year of catering to the dinner daypart, which started with the wok and stir-fry offerings. Eight months ago, pizza was added to the lineup, as well as a take and bake pizza option for customers to cook at home.

"Everything flows electronically to the stores and is all managed from my desk at the headquarters," Weiner said. "We have label machines in the stores that allow them to price items and print nutritional information, which is also managed from my desk."

In terms of technology, the chain rolled out food-ordering kiosks in 2005, which enable customers to place an order and customize items. This alone has had a "pretty significant impact" on sales," Weiner said. "It allowed customers to put things on their food that I would never think of suggesting. It always amazes me how creative people can get when given these options."

Screens in the kitchen area are driven off of the kiosks, so the staff can view the items ready to be prepared. "We have various make-station areas to prep the food, and there could be three areas all working on the same order," Hartman explained. "Then, it goes to the expediter and on his or her screen, they finish the order and hand it over to the customer."

The kitchen systems run on Radiant/NCR menu programs, but the customer still takes items to the point-of-sale to pay, which is done intentionally, according to Hartman.

"We want them to walk the store and hopefully buy things while they are waiting for their order," he said. "Also, this puts the whole operation together vs. two separate transactions."

MOVING FORWARD

The future for Rutter's includes the continued expansion of its foodservice category, and Weiner intends to keep driving the dinner daypart. He is also watching the ethnic foods category, and wants to eventually move items into the menu to fit this segment.

"I think the dinner daypart is a home run for whoever can figure it out and have a mental plan on how to get there," he said. "That will be a big part of our future, and the futures of anyone else in the industry."

Overall, Hartman believes more operators will begin to embrace foodservice, and those who already do so will continue to expand and grow their offering. Those who choose not to enter the foodservice playing field may choose to offer a branded program, such as Subway.

"I don't see many limits on where we can go with foodservice," Hartman said. "C-stores are like chameleons. We can change our colors faster than the others can. We can adjust our food offering faster than Starbucks, McDonald's or Subway because of our entrepreneurial nature. Those who have a commitment to it will continue to morph and grow, and will be a significant competitor to QSRs [quick-service restaurants]."

And Rutter's is well on its way.

For comments, please contact Tammy Mastroberte, Contributing Editor, at [email protected].

1920s

Rutter makes its mark in the dairy business.

1940s

into ice cream dipping with ice cream parlors at its dairy stores.

LATE 1960s

Rutter's opens store, offering roller grill items and sandwiches.

1980s

The retailer operates a chain of six full-size family restaurants.

1990s

stores takes off, as the chain introduces higher-end brews. The fountain area is also expanded from four heads up to 12.

1997

Rutter's hires Jerry Weiner to focus solely on the foodservice category full-time, as the company begins opening 5,000-square-foot "super stores."

2000

Rutter’s sells the last of its full-size family restaurants.

2005

ompany begins bringing all of its brands back to the Rutter's name, including its proprietary sandwich line then called Famous Express.

2008

Rutter's introduces a new store prototype that takes its foodservice section up to a new level. These stores offer a proprietary grill program and wok-prepared stir-fry meals, and are equipped with high-speed ovens and fryers.

2011

The chain adds pizza to its menu.

2012

Innovation continues, as new foodservice items are rolled out every few months or less.

"In the c-store, we are up against a perception issue. If you ask a customer on line at McDonald's how long they waited, and it was actually 10 minutes, they would say five. But if it was a c-store, they would wait five minutes and say it was 10."

— Jerry Weiner, Rutter's Farm Stores