Melissa Rosen, CEO of Locali, brings fresh food to a west coast food desert.
By Jaclyn Crawford
A good business sees a need and addresses it appropriately, and then, there are a few exceptional business ideas that don’t just address a need, but improve the community and the consumer. It was that mindset of that sparked the idea of Locali, a health-food convince store and deli chain in California.
When starting a business to create change in the community, sticking to core values and mission statement is a must. We were able to speak with Melissa Rosen, CEO of Locali, about the idea, challenges, and what she sees in Locali’s future.
1. Tell me about the inspiration for the business? How did you identify the need?
I was working for a physician doing health counseling in an indigent part of LA County and most of my patients were buying their food at convenience stores and gas stations because it was a “food desert” with limited grocery options. I thought it would be great if people could get healthier options at the convenience store. I am from Chicago and my partner, Greg Horos, is from Philadelphia. We were used to convenience stores from our youth like White Hen Pantry and Wawa that had a fresh deli component. We hadn’t found that on the West Coast. We thought of the idea of our “7-Eleven meets Whole Foods” brand – Locali Conscious Conveniece – with this in mind. With all of our increasingly hurried lives, we saw the demand for natural foods in a convenience store format.
2. What were some challenges in pursuing and sticking to your core values? How did you overcome them?
We are one of the only QSR brands offering completely organic produce in our soups, salads, smoothies and sandwiches. Our meats are certified humane, gluten, casein, hormone and antibiotic free. Our vegan meats are non-GMO. In order to maintain such a standard, our price point is obviously going to be higher than your typical sandwich shop. With fluctuating commodity costs, we had to price things in a way that was not off putting to customers while still maintaining our margins. Luckily, our food is genuinely off-the-charts delicious, according to Yelp reviews, people truly taste the quality of their investment with every bite. We also learned early on not only how to menu engineer, but to effectively and yet in no way repetitively reuse ingredients in order to maximize profits and reduce waste. As a result, we have almost non-existent food waste.
3. What has been your biggest success as CEO of Locali?
Securing our next location in Venice. We were looking for the ideal location for what will be our true flagship on the west side of Los Angeles. We wanted to be in a hip, progressive neighborhood, but still stick to our business model which is to offer healthy foods in an unpretentious atmosphere to a diverse array of customers. We had many landlords courting us, but offend for rents that were ultimately unfeasible once you hit the three year mark. We were able to negotiate a far below market rent and ten year lease in a fun strip mall in one of the coolest up and coming spots in Venice. We see this unit as being the refined prototype for our future corporate and franchise growth.
Now heading into our sixth year of business and with our third location about to open in Venice, there is still no one else doing what we are doing in the marketplace. We feel very excited by the prospects of our model for both corporate and franchise growth because it is turnkey, the ingredients can all be nationally sourced, the units requires low overhead and build outs, don’t always need a hood or a grease trap, are relatively inexpensive by restaurant standards to open and thus quickly scalable. We have also finished initial R&D, packaging design and have a committed co-packer and distributor for our vegan food line.
We see Locali Conscious Convenience as growing to a national brand with QSR units in a variety of formats in urban settings, college campuses, airports, hotels, malls and mixed use developments (we are able to operate in spaces even under 100 sq/ft). In conjunction, with our strategic corporate and franchise growth, we feel that our packaged food line has tremendous potential, both for in store sales and in distribution through other grocery retailers. We have bootstrapped our business the entire way up until now, but of course, have now begun to entertain like-minded investors, because we know that while we have all the pieces in place to execute our growth strategy, it will not happen without an outside injection of capital.
5. What advice do you have for executives who are leading a team, who are maintaining the vision of the company’s values?
Walk the walk. I know many top people in the natural foods industry whose lifestyles don’t correspond with the products or services they are marketing. If you are selling people, and especially your staff, on the product you are marketing as being healthy and vibrant, you should do your best to maintain your own personal health and physical integrity. My partner and I often joke about the things we would love to indulge in if we were not in this business, but we are committing to the lifestyle and eating philosophy our brand, Locali, advocates in the marketplace. Our team has a respect for the authenticity we bring to the table and also, the transparency we have in our management style. They see the personal sacrifices we have made to continually reinvest in the business and also, to continue to provide them raises in order for them to make above the industry standard for fast food employees. We have an exceptionally bright and loyal team that believe in the model and have stuck on working for us for years because they know that we genuinely want them to grow with the business. The love and compassion we show our team translates into the warm, signature customer service experience that is now a trademark of Locali.