Denyelle Bruno announced ambitious plans to double Tender Green’s restaurant footprint over the next two years when she took on the chief executive role this summer.
Three months into her new job, and it appears Bruno is on her way to making good on the promise: The Culver City-based company has signed five new restaurant leases for 2019 and is actively negotiating another five, the executive said in an interview with the Business Journal.
Tender Greens, which is incorporated as TYP Restaurant Group Inc., currently has 28 locations − 15 in Los Angeles County, two in Orange County, four in San Diego, two in Boston and one in New York City. The next round of expansion is on the East Coast and in Northern California. The company is on track to hit $100 million in revenue this year, according to media reports. Bruno declined to comment on revenue figures.
“Right now, we’re building out in the Eastern Seaboard,” Bruno said. “We are opening three more restaurants in New York in 2019 and two to three more in Boston.”
Northern California will also see expansion with two more locations, she added.
Bruno said a successful expansion comes down to building teams, systems and work flow, which makes or breaks a company’s brick-and-mortar growth.
“At the restaurant level, it’s defining what the structure needs to look like,” she said.
But it isn’t as simple as that, experts said. A company’s growth also depends on its suppliers meeting online and brick-and-mortar demands. Because Tender Greens sources produce for its menu from local and regional farmers, it needs to make sure its supply chain is ready to meet demand without compromising quality.
“This trend will only continue, so maintaining a dedicated area of the service counter for deliveries/pick-ups only and ensuring that your packaging is intelligently engineered to maintain the best possible integrity of the food is key,” said Paul Pruitt, founder and principal at New School, a downtown-based restaurant consulting agency.
Tender Greens’ local farming partners include Oxnard-based Scarborough Farms, which was also an early investor in the company.
“(Tender Greens) are trailblazers in the fast-casual movement,” said Jeff Stein, whose family owns Scarborough farms. “Two of the three co-founders came from fine dining backgrounds, so quality was important from the start.”
Stein said investors from Scarborough had a “30 percent collective sell off” after New York City restaurateur Danny Meyer and his Union Square Hospitality Group took an undisclosed minority stake in Tender Greens in July 2015.
Scarborough is still Tender Green’s head lettuce grower and supplies its produce to the majority of the restaurant’s California locations.
If Tender Greens does indeed double its brick-and-mortar footprint in two years as planned, Stein said he would increase plantings by 130 percent.
“I’m currently growing 250,000 heads of lettuce per week,” he said.
His produce output takes into account losses in the field and warehouses, too, he added. Scarborough’s other clients include produce distributors nationwide.
Bruno, an Apple Inc. and Drybar Holdings alum, replaced co-founder Erik Oberholtzer and serves in the dual roles of president and chief executive. Oberholtzer is now executive chairman of the fast-casual restaurant brand.
This is Bruno’s first stint as chief executive in the restaurant field, but she said her experience in retail strategy cuts across industries. At Apple, she worked on the retail development team in the late 90s, helping come up with the Apple store concept. Other stints include vice president of retail strategy and market expansion at Emeryville-based Peets Coffee & Tea, and her most recent gig was president of retail operations at Irvine-based Drybar, a chain of salons primarily offering hair styling services. During Bruno’s three-year tenure from 2014 to 2017, Drybar’s locations grew to 55 from 28.
The upcoming expansion push for Tender Greens is focused on the East Coast. The restaurant has partnered up with Gotham Greens, which grows its produce on rooftops using hydroponics.
“Growing on rooftops in NYC makes a lot of sense as land is extremely expensive, and rooftops are an underutilized class of real estate,” said Viraj Puri, founder of Gotham Greens.
The produce company has expanded to additional cities (including Chicago and Baltimore) and isn’t limited to just rooftop real estate. Its primary competitors are large-scale industrial farms on the West Coast.
“Ninety-eight percent of lettuces and herbs that are grown domestically come from Arizona and California, and travel thousands of miles before reaching consumers in other parts of the country,” Puri said.
And therein lies the issue, said Salar Sheik, of West L.A.-based Savory Hospitality Consulting, another restaurant consultancy.
“Tender Greens’ ethos and its distinction is that it’s a fast-casual restaurant chain that’s known for its fresh, quality food,” he said.
Bruno’s challenge, Sheik said, would be quality control issues. “It’s easier to do what you’re doing with 20 to 30 restaurants when dealing with perishable goods. Can they have the same stellar quality when its 50 or 60? Expansion isn’t the issue, keeping up with the quality will be.”
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