Worcester Regional Chamber of Commerce: Profitability of a Commercial Kitchen Executive Summary

Worcester residents have a need for fresh, local, and healthy food. The problem is that a great portion of Worcester’s population has little to no access to this food. An establishment was needed to help alleviate this issue and the solution was a food hub containing a commercial kitchen. This food hub will aggregate fresh food from local farmers and help to remedy the food deserts in Worcester. The commercial kitchen provides a facility where individuals can incubate their food business, create value added products, and receive culinary training. The goal of this project was to determine the profitability of the commercial kitchen.

In order to achieve this goal, market and financial analyses were performed. The market analysis consisted of background research, stakeholder interviews, and a public interest survey. These methods investigated those interested in renting the commercial kitchen space. The research sought the programs individuals wanted in a kitchen, the equipment they need, and the amount they are willing to pay. The financial analysis took the monetary information that research subjects provided and specifications of equipment in the kitchen. This created a cost estimate for the kitchen. From this estimate, a sensitivity study was produced to show three scenarios for the profitability of the kitchen.

From the financial data, interviews, and survey, recommendations were made to help make the kitchen profitable. A recommended pricing scheme for the kitchen includes a $40 per hour rental fee, various storage, application, and membership fees. The suggested kitchen requirements include kitchen leashes, movable steel preparation tables, a canning machine, a larger kettle, and a larger flat top grill. Shifting to culinary programs, these recommendations include various recreational, production, and business classes. These services may be offered by the commercial kitchen staff or outside vendors. The kitchen should be marketed through various types of media, for example ads on local radio stations. Another important service and marketing tool is a premade, joint food product label that benefits the kitchen and producer. Finally, food hub and kitchen expansion ideas are to utilize a food truck, create a store, and foster a network of kitchens. A combination of these recommendations will lead to a profitable commercial kitchen at the Worcester Regional Food Hub.