When a recession hit in earnest, the impact of consumers’ tightened purse strings was felt quickly. Lost confidence in the strength of the economy, new worries about income, and a focus on saving money sent people into a sort of hibernation with their usual discretionary spending. What was one of the first behavioral changes made by consumers? No more eating out.
For the fast-casual restaurant industry, it was a heavy blow. Across the board, sales fell and growth slowed. Despite their position as one of the most successful chains of its kind, California Pizza Kitchen didn’t escape the drop in customer counts. The company began taking a closer look at expenses to see where there was opportunity to save. A $21 million-a-year line item stuck out like a sore thumb: energy expenses.
Restaurants are among the biggest energy consumers of all types of commercial spaces. Beyond the demand created through heating, cooling and lighting, the cost of sanitation and the utilities needed to run cooking equipment all add up to an energy spend that can be a significant percentage of operating expenses.
Concern over this $21 million cost led California Pizza Kitchen to seek the help of energy management experts ENGIE Impact to gain a better understanding of how California Pizza Kitchen could better manage its collective energy use.
ENGIE Impact had already been processing the company’s expenses for years and had already developed highly detailed profiles of energy use trends for every restaurant in the company’s portfolio, representing more than 250 locations. This vast database of energy consumption data that had been built during the bill payment and auditing process was the key to the success of California Pizza Kitchen’s energy management program.
Armed with this data, ENGIE Impact was able to quickly identify and prioritize areas for improvement. This consumption data was integrated into monthly Energy Performance Reports (EPRs) that drill down to site-level detail. Facilities with similar energy requirements commensurate on climate, size, and hours of operation were grouped for easy comparison. The EPRs allows users to compare site performance against portfolio averages as well as Department of Energy database averages.
Coleman’s team put ENGIE Impact’s EPRs to the test, using the data identify the restaurant chain’s worst performing locations, analyze what it was about those sites that made them outliers in their group in terms of energy use, and put solutions in place that would get their use back down to the portfolio average.
The EPRs allowed Coleman to make the smart decisions about behavioral changes and equipment upgrades. With better facility intelligence, the company was able to validate conservation efforts and began by targeted low- and no-cost measures:
These energy conservation initiatives helped California Pizza Kitchen quickly reduce energy consumption, drive savings and report results.
December year-to-date compared to prior December year-to-date:
California Pizza Kitchen’s energy problem was not uncommon. While they are experts in managing the basic costs associated with running their business, they lacked a fundamental understanding of energy’s impact on the bottom line and were unaware of the best actions to take to reduce energy costs. Once equipped with the right data, they were able to translate what was once a big unknown into big savings.