After nearly six years of rapid expansion, a recent wave of store closings has Urban Farmhouse owner Kathleen Richardson pushing the reset button on her café’s strategy and looking for investors.
“Sometimes you have to look back and reevaluate everything,” said Richardson, who founded the local chain in 2010 in Shockoe Slip. “I think that’s something good for business…and it’s something I’m working on moving forward into the new year.”
That reflection was prompted by the closure this year of three of her six Urban Farmhouse locations. She closed the Church Hill store in February, the Manchester site in November and the VCU store this month.
A native Richmonder and VCU alum, Richardson returned to the region to launch Urban Farmhouse after 20 years of working in the food service industry for corporations like McDonald’s, Starbucks and Panera.
“I was ready to do something on my own,” Richardson said. “The idea of a clean food, quick-serve location where people could grab and go, and know that they were receiving fresh, healthy foods was important to me.”
She pumped in $150,000 to launch her first location on East Cary Street six years ago and the café quickly became one of the region’s fastest-growing local brands – often finding roomy, renovated digs in one of the city’s up-and-coming neighborhoods for new locations.
“We had the model down,” Richardson said Thursday morning at her Scott’s Addition café. “Once we found a location, getting the site set up and staffed was never a problem because we had the concept down.”
By the start of 2016, Richardson was on course to open her seventh Urban Farmhouse location, with plans to branch into other sectors of the region and city.
But there were signs early on at a few of her newer cafes that gave her pause – the biggest being slow sales.
“When I first opened the Rocketts Landing location, it made money within the first month of opening,” Richardson said. “That gave me the confidence to go out and open additional locations in other neighborhoods, thinking that the same effect would occur.”
“I found that I was bootstrapping these locations on my own,” Richardson said. “We love going into new neighborhoods. … That was always part of our concept, but it seemed that it was taking longer for things to happen in those neighborhoods, and I just couldn’t keep those locations operational.”
For example, while Manchester is in the midst of a renaissance, Richardson said low daily foot traffic and a lack of residential density on Semmes Avenue made it impossible to stay open.
“I should have closed that location earlier,” she said. “But I was optimistic for the neighborhood, and while there are a lot of great things going on down there, I think we may have gotten in a bit too early.”
The same can be said about her recently closed VCU store on West Broad Street.
With her location across the street from the under-construction VCU Institute for Contemporary Art, Richardson envisioned capturing not only students, but visitors seeking a spot to meet up for coffee or a glass of wine before a gallery showing.
However, with the ICA’s opening still about a year away, Richardson found herself in a similar situation she had faced with her Manchester location.
“It was tough,” she said of closing the VCU outpost. “But it just made sense.”
Urban Farmhouse now has four locations around the Richmond area: in Scott’s Addition, Rocketts Landing, Midlothian and the original in Shockoe Slip.
With a smaller footprint, Richardson said she’ll focus on retooling her business strategy and still hopes to grow.
Urban Farmhouse is preparing to take over about 1,300 square feet of former restaurant space in the historic Linden Row Inn at 100 E. Franklin St. for a fifth location.
“The site will be open to the public,” Richardson said. “It’s not exclusively for guests, but open to all that will be passing by.”
As part of her arrangement with the hotel, Richardson said Urban Farmhouse will be able to use Linden Row’s kitchen, and will serve as the exclusive caterer for events and weddings – all but becoming the linchpin for her newest venture: catering via Farmhouse Functions.
“The margin of income for catered events is actually greater than what we make at the café,” Richardson said. “It’s an exciting opportunity for us.”
The partnership that could pay big dividends going into 2017.
“The venue is more than 50 percent booked for weddings and events next year,” Richardson said. “And there are more signing on in 2018, so we’re very excited about our agreement with Linden Row Inn.”
Richardson added she’s also in the market to find local investors to help grow the Urban Farmhouse brand.
“I’ve always envisioned Urban Farmhouse being a Richmond-based café,” Richardson said. “But I went about it on my own, and that was a mistake. I want to find investors that share my vision, and are willing to help me grow in the area and in parts of Virginia.”
That includes finding investors that may allow her to return to the Manchester neighborhood and VCU campus, and better identify sites in locations in the region with promising growth indicators.
“Obviously, had I had the financial backing I would have kept those locations open,” Richardson said.
Richardson also plans to continue to focus on customer service and quality control at her existing locations, which includes working with local businesses and existing suppliers.
Looking back, Richardson said starting her business has been educational and rewarding, and she has no regrets.
“Some would say that this happened because we grew too fast, and I couldn’t disagree more,” she said. “I think we hit all the right places, because those spots are growing, I think our timing was just off. But moving forward, I feel confident we are back on the right footing for healthier growth.”