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Company spotlight: The Middleby Corporation

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The Middleby Corporation has morphed from a small bakery supply company into a globespanning conglomerate. So how does it stay at the cutting edge?

For a huge and highly ambitious company with dozens of brands in its portfolio, The Middleby Corporation has humble beginnings. Founded as a bakery supplier by Joseph Middleby and John Marshall in Chicago in 1888, it grew steadily and rapidly, organically and by acquisition, to become truly global.

For more than a century the Middleby brand was well-known in the industry and had operations in various locations in the Chicago area. The company went public in 1983, changing its name to The Middleby Corporation. Keeping its local roots, Middleby began manufacturing operations in Elgin, Ill, in the early 1990s and the corporate offices permanently moved to this facility in the early 2000s.

Known for its acquisitive approach, Middleby has become a leading player in the commercial kitchen sector worldwide, offering advanced innovations for cooking and warming, refrigeration, freezing and beverage solutions for top restaurant and institutional customers. It is prominent in every sector of the market – QSR, fast casual, pizza, casual and fine dining – and has built a strong reputation through leading brands and innovative technologies that are key to foodservice operators.

Since the turn of the 21st century, it has assimilated companies including Blodgett, Pitco, Taylor, TurboChef, Viking Range and Aga Rangemaster Group, and this history of strategic acquisition continues today.

In December 2019, the company completed the acquisition of Evo America, which brought game-changing ventless cooking technology into the portfolio. Prior to acquiring Evo, Middleby acquired Taylor Company in 2018 for $1bn, the company’s largest acquisition to date, which well-positioned them with a strong brand in beverage and ice cream.

More recently, Middleby has entered the beverage market quickly and aggressively, acquiring Taylor, WunderBar, JoeTap, Concordia, Synesso, SkyFlo, Starline, Ss Brewtech, Deutsche, U-Line and Follett. With an expanding portfolio, it would be easy to think of Middleby as little more than a collection of successful and innovative brands. As CEO Tim FitzGerald (pictured) explains, however, there is so much more to the company.

“Our strategy is to acquire respected brands with industry-leading innovation to strengthen the overall Middleby portfolio. We continue to focus and accelerate innovation after we acquire due to our resources and culture of sharing ideas across the company. Although the brands act independently, we combine products to provide integrated best-in-class comprehensive solutions for the many segments we serve, he says.

“We have further evolved to add technology strategies and capabilities such as IoT, automation, data intelligence and Middleby controls that support all brands and drive kitchen efficiency.

“We have made investments in capabilities such as installation and service so we can best serve customers. We also have focused on building a large, global organization to provide support to our customers anywhere in the world.”

More than meets the eye

Middleby is best known for its cooking, heating and refrigeration solutions, but that is just one component among many that enable the company to provide integrated solutions for its clients, no matter what kind of foodservice operation they are putting together.

“Now, $2bn of our $3bn annual revenue comes from commercial foodservice, in which we have more than 60 brands,” says FitzGerald. “Residential high-end appliances are around 20% of the business, with food processing accounting for 15%. There is a lot of technology sharing between the three business segments, and our commercial customers are very interested in our large-scale baking and processing solutions,” he says.

“The beverage side now accounts for around 30% of our commercial foodservice business, but that is a less well-known aspect of what we do. We have many beverage solutions for hot and cold, including a new Taylor Zamboozy frozen drink machine (pictured) that was developed since they joined Middleby.”

Wunder-Bar has been a big name in liquor dispensing for more than 40 years and, since the 1990s, it has been actively developing a wide range of food dispensing systems. Among them are systems for dispensing condiments, heated cheese, oils, salad dressing and pizza sauces. Another brand that is key to Middleby’s beverage offering is Follett, which has been designing and manufacturing innovative ice storage and transport systems, ice machines, ice and water dispensers, and ice and beverage dispensers since the 1940s.

“The depth of our portfolio has allowed us to work with customers to put together a solution with Follett Ice, JoeTap Nitro Brew and U-Line refrigeration and dispense. We have the capability to meet the needs of our customers,” says FitzGerald.

“We have invested internationally, a strategy that will benefit all brands. Today we have established operations around the world including Latin America, Australia, Russia, Dubai and China. We are opening up markets for all of our brands that they might not be able to reach on their own.”

A focus on innovation

As a company with one eye fixed on the future, Middleby has been quick to buy into emerging trends. When it acquired commercial grill manufacturer Evo last year, it added the EVent ventless electric griddle – an outstanding addition to its other ventless technologies. Evo president Scott Heim (pictured) then expanded his role to president of Middleby Ventless Solutions, leading all brand efforts in this area.

This technology uses downdraft ventilation designed for front-of-house cooking in restaurants, sports arenas, cafeterias, convention centers, resorts, grocery stores and other locations without overhead hoods. Easy to install and move, as there is no need for expensive, cumbersome ductwork, ventless cooking allows kitchens to be put almost anywhere.

“Ventless cooking is a gamechanger. It allows you to cook anywhere. Five years ago, we thought fire departments and public health authorities would never approve it, so the market crawled along slowly, but now 84 major US metropolitan jurisdictions and many cities in Canada have approved it. North America has led the way in ventless technology. You are not constrained by a Type 1 hood because there is no need to vent externally. Middleby is at the forefront of the ventless revolution and it is one of our prime initiatives. It allows our clients to create a kitchen – a pocket of revenue – anywhere they choose.”

Middleby ventless equipment includes products from Evo, TurboChef, Blodgett, Perfect Fry Company, Wells, CookTek and others to meet the needs of any concept. QualServ Solutions, a Middleby manufacturing company, also has the capability and experience to build an efficient ventless kitchen.

The EVent ventless griddle is one of the company’s key ventless products and has an integrated ventilation system that extracts air across the griddle surface through a series of filters, including an electrostatic precipitator that removes smoke and grease particulates, before exhausting clean air.

Heim has come to understand how the company works and how important innovation is, across all of its brands, as part of its culture. “I knew Middleby was a public company, so I expected it to be bureaucratic and to move slowly. In fact, it is entrepreneurial and each brand has a lot of independence. Acquisitions bring in great talent and innovation, and I see firsthand the extensive collaboration across the companies. Middleby effectively leverages its brands and international resources to stay ahead in the market.”

Just as FitzGerald understands the need to invest in a strong regional presence across the globe, he also understands the importance of keeping abreast of the latest technological trends that could benefit the entire family of Middleby brands, taking the company’s innovation strategy into the realms of the Internet of Things (IoT), smart controls and robotics. With connected equipment and automation operators can run their businesses more efficiently.

“We want to be the brains of the kitchen. Data from operations is important because it helps operators to make decisions and allows them to address one of their biggest issues – labor costs – to leverage their footprint and manage equipment,” he says.

“We are now heavily focused on ghost kitchens as they are growing quickly and connectivity and speed are important to their operations. Additionally, kitchen automation is highly desired in all settings to address one of the biggest industry issues – labor costs. Data is needed to review workforce productivity and efficiency versus product sales during their respective shifts.”

A solution called Open Kitchen, launched by Middleby brand Powerhouse Dynamics in 2019, monitors the operations efficiency of the entire restaurant, including HVAC, power usage and all brands of commercial equipment, not just the Middleby brands. Connected to the cloud, operators have remote access to critical data and performance monitoring. Operators can get a single view of their estate across all locations and all equipment regardless of the brand.

“Brands innovate, but as a company we can make innovation go faster. Our team strategically connects the companies we acquire to existing Middleby brands, which takes communication and collaboration. Soon we have them working together on new products, customer projects and sharing innovations and applications between the companies,” explains FitzGerald.

Connecting with consultants

Brands collaborating to create solutions for clients is an essential part of how Middleby operates. But that sense of working together extends beyond the company to include consultants. The importance of consultants is obvious in the role of Meghan Daro (pictured), VP of Consultant Services, who joined the company two years ago. Her role brings together her extensive experience in business development, marketing and sales to create what she calls ‘Middleby mind share’.

“I’m a people-connector, for the company and for its brands,” she says. “There are so many brands out there, so we need to make consultants understand what Middleby can do. My main effort is to connect brands to end-users and consultants. We focus on innovative solutions that bring together beverages, cooking, warming, refrigeration and freezing. We want to build a partnership in idea-sharing, so that we can both educate and learn from consultants.”

Since Daro arrived, the response from consultants to the new Middleby outreach program has been encouraging. “Consultants really appreciate our engagement. From our first two-day consultant seminar, a floodgate of communication opened up because consultants really want to know about our products and services, and how we do business. They quickly come to understand that Middleby is not just about the hot side and the bottom line. This is a $3bn company, but all the brands it owns have an entrepreneurial spirit, sometimes in healthy competition with each other, but always working together. No other conglomerate offers such variety and dedication to innovation to deliver product platforms and solutions that help customers to resist market disruption.”

Middleby reaches across the globe but is firmly anchored in its home market – most of the commercial products sold in North America are made in the U.S. This is paralleled by a corporate philosophy that brings together the benefits of a huge business with the agility of a smaller company. “We have a business that is large in scale but we want to act like a small company,” says FitzGerald.

“I joined Middleby in 1998 to be part of an entrepreneurial, innovative company, which we have created. The challenge today is maintaining our small company culture, which has served us well, as we continue to grow in the marketplace.”

Jim Banks

 

COMPANY TIMELINE: MIDDLEBY THROUGH THE YEARS

●1888 Middleby is founded by Joseph Middleby, a bakery oven builder and designer

●1997 Middleby becomes a public company

●2001 Middleby acquires Blodgett, Pitco and MagiKitch’n in a challenging business environment following 9/11

●2004 Majority shareholder exits Middleby allowing for a more aggressive acquisition strategy

●2005 Middleby acquires Alkar and RapidPak, entering the food processing market and new business segment

●2009 TurboChef is acquired by Middleby, giving the strong brand and proven rapid cook technology an expanded global reach and resources

●2012 Middleby acquires Viking Range, entering the ultra-premium residential appliance market and starting a third business segment

●2018 Middleby acquires Taylor Company for $1bn greatly expanding the Middleby offerings in the fast-growing beverage market

●2018 Middleby acquires Evo and solidifies its wide offering of ventless commercial kitchen products

●2019 Tim FitzGerald is appointed CEO following the retirement of Selim Bassoul

●2019 Middleby brand Powerhouse Dynamics launches its Open Kitchen IoT Solution