Kroger might try-out Ocado robots for newly launched restaurant supply business in Dallas
Regional restaurants, bakeries and catering companies can get next-day deliveries, and all orders of $250 or more are free from Kroger Restaurant Supply.
Kroger announced on Tuesday that it has launched a restaurant supply business offering next-day delivery to establishments in the greater Dallas area.
Kroger Restaurant Supply offers “competitive wholesale pricing” by the case or unit to restaurants for delivery seven days a week.
The new supply business comes as grocers increasingly court business clients for their e-commerce services.
Ron Law, a Kroger Restaurant Supply delivery driver, makes a food delivery to Eno's Pizza Tavern in the Cypress Waters development in Dallas and Coppell.(Richard W. Rodriguez / AP Images for Kroger Co.)
Kroger’s Dallas division is launching Kroger Restaurant Supply, which it’s calling an answer to stubborn and ongoing supply chain issues.
The service, which started this week, is exclusively for the Dallas area. It’s pitching itself as an alternative to the traditional restaurant suppliers such as Houston-based Sysco, the largest wholesale supplier to eateries in the U.S., and Illinois-based U.S. Foods.
Kroger says regional restaurants, bakeries and catering companies are the types of businesses that will use the service.
Next-day deliveries on all orders of $250 or more are free. Businesses can order by midnight, seven days a week. Kroger says it’s more flexible than its competitors, which can have minimum orders as large as $1,000, highly variable pricing based on order size and a fixed day of the week for deliveries. Kroger said its prices will be competitive and restaurants will have the option to order by the case or in smaller quantities.
“When our D-FW restaurants think food, we want them to think Kroger,” said Keith Shoemaker, president of Kroger’s Dallas division. He called the wholesale business an “extension of our overall grocery ecosystem.”
“Like our resident shoppers, we know our commercial customers want options and solutions that offer fresh food, consistent pricing and reliability,” Shoemaker said.
The family-owned Eno’s Pizza Tavern, which has three locations, is one of the first to use the service.
Eno's Pizza Tavern in the Cypress Waters development along LBJ Freeway is one of the first customers of the new Kroger Restaurant Supply business in Dallas. (Richard W. Rodriguez / AP Images for Kroger Co.)
Shane Spillers, co-owner of Eno’s, said the business is still using its longtime suppliers but will use Kroger’s service to supplement incomplete orders that were always a reality but have worsened the last couple of years with multiple supply chain issues.
“Our managers are constantly having to drive in their own vehicles to stores for missing ingredients -- peppers or flour. We can’t make pizza without flour,” Spillers said. “This is going to save a lot of grief for our staff. I need people focused on guest services.”
“Supply chain bottlenecks are impacting nearly every restaurant across the country — this opportunity comes at a great time for small and independent restaurants,” said Corey Mobley, executive director of the North Texas Region of the Texas Restaurant Association.
Jay Scherger, director of Kroger’s technology and digital/e-commerce accelerator, said the idea came as the largest U.S. traditional grocer was looking for new opportunities to leverage investments in online grocery shopping.
That includes Kroger’s automated online grocery facility in Dallas that will be able to process 18,000 orders a day when it opens later this year. For now, Scherger said, Kroger Restaurant Supply orders are now being filled from the company’s warehouse in Keller that supplies the company’s stores.
The facility has been under construction with Kroger’s U.K.-based technology partner Ocado in southern Dallas for two years. Kroger will also be using it to make home deliveries to customers as far away as Oklahoma City, Austin and San Antonio.
“We talked with dozens of restaurants and chefs, and we know we can get smaller quantities to them more frequently,” he said. “We’re looking at new and old problems that we can solve, and this is the fruit of that process.”
