When father-and-son team Pedro and Kevin Echevarria purchased culinary-incubator business Dream Kitchen in 2014, they already knew they would be their own best clients.
Located in Elgin, Ill., about 50 miles northwest of Chicago, Dream Kitchen’s top draw is its shared commercial kitchen featuring four cooking stations, two baking stations, copious prep space and a warewashing area.
Dream Kitchen’s main “client”—and sister business—is Rria Foods, an empanada production company the Echevarrias launched in 2013. Rria relies on Dream Kitchen’s equipment for food prep and support, while food assembly equipment occupies the center of the three-part facility. The remaining space is dedicated to storage (walk-in freezers and coolers plus dry storage) and a loading dock.
“When we started Rria Foods, we knew we would need access to a commercial kitchen as well as space for the empanada assembly equipment,” Kevin, Pedro’s son, says. “It was hard to find a location small enough to fit our budget, and we wouldn’t have been able to afford to build a full kitchen. So we began looking at shared kitchens and former restaurant locations.”
Then they visited Dream Kitchen, opened in ’11 in Elgin’s industrial warehouse district. The space next to Dream Kitchen was available for rent. Covering 2,600 sq. ft., it was the perfect size to house their empanada production equipment with plenty of room left over for storage.
“We worked out an agreement with the landlord [and Dream Kitchen founders Tim and Marcia Kellenberger] in which they gave us permission to use the kitchen—they even installed a door between Rria and the kitchen,” Kevin says.
In a few months, the Echevarrias were helping oversee and maintain the culinary side of Dream Kitchen as well as getting their empanada operations set up.
The build-out work for Rria Foods began in January ’13, empanada production in August ’13—and in April ’14, the father-son team purchased the Dream Kitchen business as well.
The Echevarrias’ new business tapped into a small but steadily growing niche: incubator kitchens, i.e., professionally equipped kitchens available to rent by the hour or various blocks of time to make commercially produced foods. The tally of incubator kitchens in the U.S. is a moving target. A 2013 industry study conducted by Philadelphia foodservice consulting firm Econsult Solutions identified at least 150 such kitchens nationwide. As of February, an online database called culinaryincubator.com, which invites shared commercial kitchen businesses to post their information, listed more than 460 locations in about 45 states.
The Echevarrias wasted no time in marketing their new business. Besides Rria Foods, their main client is The Salvation Army and its Meals On Wheels program for the Elgin area—a five-day-a-week operation responsible for turning out some 1,000 meals daily. As an anchor client, The Salvation Army was welcome to bring in some of its own equipment, such as a packaging/sealing machine, food warmers and a milk cooler.
Other regular clients include a cupcake business, local caterers and even a food blogger; Yvonne Maffei, who writes “My Halal Kitchen” at myhalalkitchen.com, rents space at Dream Kitchen to test and refine recipes for her upcoming cookbook. Food photographers, cooking classes, commercial equipment training programs and food-business consulting also are part of Dream Kitchen’s target market.
A year into operations, the Echevarrias’ two businesses are generating about $650,000 in sales; of that, about $200,000 comes from Dream Kitchen contracts.
Touring Dream Kitchen
Dream Kitchen’s shared culinary space occupies 2,500 sq. ft. with four cook stations (two per side, back-to-back) positioned in the center of the space and two bakery stations next to them.
Each station includes a six-burner range/oven and griddle plus one or two extra pieces per station; a salamander, chargrill, fryer and vertical broiler—privately owned; clients can bring in their own equipment to round out the cooking battery. The two baking stations are simpler: a couple of convection ovens and one proofer each. Each cooking station is supported by two stainless prep tables nearby. Above the tables, drop-down power cords enable cooks to run all kinds of countertop equipment. Reach-in refrigerators and freezers, tables holding stand mixers and a slicer are positioned along walls.
Walk-in coolers and freezers and dry storage areas are on one end of the facility. Assigned shelves in walk-ins delineate what belongs to whom. Dry storage units can be locked for security.
Dream Kitchen’s original owner equipped the space with pre-owned restaurant equipment. The Echevarrias, however, plan to systematically replace existing equipment with new units. As the new equipment is installed, the team envisions a series of training programs to teach clients how to get the most from each piece of equipment.
Maintenance is handled in-house. “We do daily rounds to check equipment and make minor repairs when needed,” Kevin says. “Pilot lights might go out, control panels might fail—things like that, we’re able to fix ourselves.”
Dream Kitchen relies on an interactive online calendar system and a well-spelled-out cleaning regimen to coordinate its many clients.
“The booking calendar organizes all the documents needed to run the kitchen. It also serves as a portal for health inspectors, so they can see who is in the kitchen at what times. They can choose to come by for a surprise inspection of individual clients or to check the facility,” Kevin says. “Without our online calendar, it would be chaos.”
Cleaning supplies with strict guidelines on cleaning procedures sit near the three-compartment sink. Despite Dream Kitchen’s many culinary clients and visitors, including Elgin Mayor David Kaptain, the place is spotless. “We average 98-100 points on our health inspections,” Kevin says. “If clients don’t follow the sanitation guidelines, we ticket them. If they get too many tickets, they’ll be asked to leave.”
Growing The Dream
Growth is the key word for Dream Kitchen—both for its clients and the business.
“This is more than a leasing operation of space and equipment: Our staff can help clients with everything from web design and consulting to navigating the legal requirements of setting up a food business,” Kevin says. “A true incubator provides both space and services to help fledgling businesses get started and begin to grow. We’re entrepreneurs ourselves, after all. If someone says, ‘I want to sell this product at grocery stores,’ we’re able to advise them by asking key questions. Is their recipe scalable? Will product all be made in-house? Who’s their distributor going to be? Will they buy a truck? What’s its capacity? ... We’ve run into all these issues with our empanada business.”
Expanding the kitchen has been part of the plan from the start. “Dream Kitchen’s original owner built the business so it can be scaled up,” Kevin says. “From a contractor’s perspective, Dream Kitchen was built for growth. We have extra electrical and water hookups already in place. If we were to add a client who wanted to bring in their own, say, three-phase mixer, we’ll have sufficient electric panels to accommodate the extra piece.”
The father-son team continues to build the dream. “We recently made the decision to move forward with a private stock offering of our company to fund future growth,” Kevin says. “We’ll also launch a Business Center in the front office space that will add another 2,500 sq. ft. to the facility. Our long-term goal is to purchase the building to ensure we control our future in that space and continue building the Dream Kitchen brand regionally with added locations in the near future.”
MENU/SEGMENT: Incubator kitchen
LOCATION: Elgin, Ill.
OWNERS: Pedro and Kevin Echevarria
SIZE: 5,100 sq. ft.
EQUIPMENT PACKAGE: $75,000
PLANS: Two additional locations planned for 2016