Amy’s Kitchen seeks to shake up fast food industry

Get ready to see if Amy’s Kitchen can shake up the nation’s fast-food industry with a single word: organic.

This spring the Petaluma natural foods maker will open its first Amy’s Drive Thru restaurant on Redwood Drive in Rohnert Park, about a block from the perennially packed In-N-Out Burger. Amy’s organic, all-vegetarian menu will include meatless burgers, hand-scooped ice cream shakes, single-serve pizzas, burritos and salads.

Despite the lack of beef, the sensory experience will be reminiscent of its much-vaunted fast-food neighbor - the taste of lettuce, tomato and secret sauce on the hamburger bun, plus the aroma on your clothes after dining in the vicinity of a french fry cooker.

But in this case, the french fries will be organic and turned crispy with sunflower oil. The sodas, the only non-organic items available for sale, will be free of preservatives. And the strawberry shakes will have an intensity of flavor unknown in mainline fast food “because,” as Amy’s food researcher Fred Scarpulla Sr. chortled, “it is strawberries.”

The tentative prices? A cheeseburger will set you back about $3, while for less than $10 you can get a double cheeseburger, shake and fries. As well, everything on the menu can be ordered vegan or gluten-free, including dairy-free shakes and hamburgers made with rice-flour buns.

Amy’s founders Andy and Rachel Berliner last week gave The Press Democrat an exclusive tasting of their burgers, fries and shakes at the company’s main plant in Santa Rosa. Regular diners are expected to get their first taste sometime in May, a month before the couple’s only child and the company namesake, Amy Berliner, gets married.

The Berliners said for years they have heard from parents who lead fast-paced lives but feel guilty about giving their children fast-food meals. With the drive-thru, said Rachel Berliner, moms will have a place “where they know their kids aren’t going to be fed chemicals or GMOs or pesticides.”

One drive-thru does not a ripple make in a $200 billion U.S. fast-food industry. Nonetheless, experts will be watching Amy’s because restaurateurs have long considered the rewards that could go to those who crack the code for making fast food healthy.

“It’s a multibillion-dollar carrot dangling out there for someone to get,” said restaurant consultant Aaron Allen of Orlando, Fla.

Getting it right on deadline

However, success requires not only delivering tasty, healthy food but also getting everything right on a deadline of three minutes per order. McDonald’s and Starbucks have made a science of such delivery, Allen said, and perhaps the biggest misstep that a startup could make would be “underestimating the sophistication and investment” required to consistently pull off such a feat.

Amy’s Kitchen has become one of the nation’s top brands of natural and organic convenience foods. Founded in 1988, the company is on track this year to reach roughly a half-billion dollars in sales, making it one of Sonoma County’s largest locally-based companies.

Amy’s employs nearly 2,200 workers in three states and makes more than 250 vegetarian products, including frozen meals, canned soups, breakfast foods, snacks and desserts.

The company ranks 20th among all U.S. makers of frozen meals and entrees, according to the trade publication Refrigerated & Frozen Foods.

And it ranked fifth with $213 million in sales for single-serve frozen dinner entrees during the 52-week period ending Jan. 25, according to Chicago-based market research firm IRI. The top four brands all experienced some decline in unit sales during that period, while Amy’s sales grew by nearly 25 percent.

But the company has never done a drive-thru, and it is opening one at a time of great upheaval in the nearly $700 billion American restaurant industry.

Today the fortunes of “fast casual” restaurants are rising, led by the likes of Shake Shack, Panera Bread, Five Guys and the juggernaut Chipotle Mexican Grill, which alone has a market value of roughly $21 billion.

Such restaurants cost diners a little bit more than fast food outlets, but they offer “a lot better food, and that’s what Americans are willing to pay for,” said restaurant consultant Darren Tristano of Chicago-based Technomic.

Not surprisingly, the gains of fast casual are contributing to “a state of crisis” in other parts of the industry, said Allen.

Mainline fast food is experiencing sluggish growth, while the biggest pain is being felt at the casual dining chains with average prices under $20 a person. Such restaurants include Applebee’s, Chili’s and TGI Friday’s.

In the midst of such change, a number of small chain restaurants have started to sell more healthful offerings, often with vegetarian/vegan menus. They include Native Foods Cafe, Veggie Grill and Lyfe Kitchen.

But such chains are focused on casual fast food, not drive-thrus, Allen said. And some of them may feel a little too foreign to the typical American diner.

Tristano said he spent time observing customers who entered a Native Foods Cafe that recently opened outside Chicago. Roughly half the people looked at the all-vegan menu and left.

Familiar, but vegetarian fare

“The general public is still very much in love with burgers, french fries and bacon,” he said. “That’s where America is still eating.”

Andy Berliner, Amy’s CEO, said when he has visited some of the healthy fast casual restaurants with friends, he has found himself acting as a sort of translator to help make sense of the menu.

As a result, he said, Amy’s has worked hard to develop familiar, though vegetarian, offerings for its drive-thru. Customers, he said, already know burgers, fries and pizzas.

When you arrive at the drive-thru, “you’re not going to have any questions,” he said.

When pressed, Berliner said he believes the drive-thru has the potential to reach many more diners than the healthy fast casual chains.

“I think it’s a much bigger idea,” he said.

Asked about growth plans, the couple said they want to take it one restaurant at a time. But they acknowledged Amy’s designed the first drive-thru so that it could be replicated.

In that design, the company turned to fast-food experts for crucial assistance, Andy Berliner said. Amy’s also set up a mock restaurant and ran a trial to demonstrate that it could hit the three-minute mark for orders.

The Berliners had their two in-house food researchers, the father-son duo of Fred Scarpulla Sr. and Jr., spend two years developing the drive-thru menu.

In that time, Rachel Berliner said, it felt like the Scarpullas had her taste every type of organic potato grown in the U.S.

Fred Scarpulla Jr. observed, “I think the most effort was put into the burger.” For example, his dad and he spent months developing the right bun.

The drive-thru initially will employ about 80 people. A company spokeswoman said Amy’s is still finalizing details but is seeking to provide benefits for full-time workers and wages for all employees that are competitive with the industry.

While newcomers to the restaurant world, the Berliners believe their company is uniquely positioned to surmount a key hurdle for producing healthy fast food, namely the building of a system that can acquire the tons of certified organic crops needed to make all those burgers and fries.

Virtually everything on the drive-thru menu will be produced or sourced directly by Amy’s, a company that already has the wherewithal to make 675,000 meals a day. In contrast, the Berliners said, the typical restaurant chain relies on outside suppliers for the multitude of components that make up their meals.

Rachel Berliner acknowledged that other chains may want to serve organic fast food, “but where are they going to get it?”

In acquiring the needed food materials, she said, “we can do it now. We couldn’t have done it before.”

You can reach Staff Writer Robert Digitale at 521-5285 or robert.digitale@pressdemocrat.com. On Twitter @rdigit