It’s been quite a ride for Rick Miles in the 10 years since he first began supplying fresh Idaho potatoes to Five Guys Burgers and Fries restaurants.
In 2002, when Miles’ company was contracted to supply fresh potatoes for french fries, the chain consisted of five stores. Today, there are 1,075 Five Guys restaurants serving their famous burgers with fresh french fries and the chain continues to grow at the rate of more than 200 stores annually and a total of 1,500 franchises in development.
In 2002, they had five franchise stores and our first shipment to them was 150 50-lb. bags of potatoes and that would last them for about 10 days,” Miles said, “We now ship weekly between 50,000 and 60,000 50-lb. bags.”
That comes to more than 150 million lbs. of potatoes annually.
With the phenomenal rate of growth, Miles recently moved his company, Rick Miles Produce Service, into a new 11,000-square foot warehouse in Idaho Falls from two small offices in Rigby, Idaho.
The new three-level building includes office space, a conference room and test kitchen as well as storage space to alleviate the demands on the packing sheds that he purchases his stock to supply Five Guys.
In the second-story offices, Rick, CEO of the company, and his wife Betty, director of new business development, work in one office. Their daughters, Sheri Littleford, chief financial officer, and Brooke Holverson, chief operations officer, work in an adjacent office. Greg Hayward, accountant; Mary Sedberry, sales; and Albany Horel, sales assistant work in a third office, all within a few steps of each other.
“The underlying factor for putting this facility in was that we’re now shipping out so much product on Thursday, Friday and Saturday that the packing facilities were having difficulty storing enough product. This will serve as an overflow for those weekends and holidays where we need a lot of extra product to ship,” Miles said.
The new facility allows Miles to store potatoes onsite, freeing up the floor space at other packing facilities during the three-day peak shipping between Thursday and Saturday. One area is a controlled refrigeration facility and next to it is a receiving area. It can handle up to 25 truckloads of potatoes or onions, another product that he supplies to Five Guys restaurants.
“We’ll be able to bring two loads, four loads, 10 loads, 20 loads, whatever we need, into this facility and have the trucks load here so they can continue manufacturing and packaging at their facility without running our of floor space,” Miles said.
A typical truckload will be 840 50-lb. units, Miles said.
A majority of the potatoes come from Idaho but Washington is supplying some of the product and a small percentage comes from Prince Edward Island, to supply eastern Canada.
Miles said there’s a five-day transit time to get the potatoes from Idaho to the East Coast. His company does all the logistics for all the deliveries.
“We provide all transportation and negotiate with all the trucking firms,” Miles said.
Five Guys has seen constant growth and Miles’ company has been able to project a year in advance how much product to contract for each year.
“We’ll be starting to make arrangements to contract our Washington supplies within about the next six weeks and then for our Idaho product, we’ll have all of the agreements in place by February and that will take us through the ’13-’14 season,” Miles said.
With 200 new Five Guys franchises opening annually Miles estimates that an additional 500,000 to 600,000 50-lb. bags of potatoes will be required to meet the demands of the new restaurants.
“We’re actually figuring through the end of July this year we’ll be servicing about 1,250 units and by that time we’ll have consumed between 2.7 and 3 million 50 lb. units from August 1 to July 31,” Miles said.