Dive Brief:
- David Chang's Fuku has ended its partnership with Reef, Business Insider reports. The split follows reports from Business Insider and Restaurant Dive that Reef's units served undercooked food and routinely failed safety inspections. Fuku is now working with Kitchen United to expand its national presence, according to a press release emailed to Restaurant Dive Wednesday.
- The fried chicken concept opened its first Kitchen United MIX location in Santa Monica, California, on Wednesday for pickup and delivery. Fuku will expand to new and existing Kitchen United MIX locations throughout the West Coast, Midwest, Texas and New York City, per the press release.
- Fuku's departure from Reef appears to be the first significant fallout for the company after a spate of reports have raised questions about Reef's ability to comply with food safety standards.
Dive Insight:
Fuku hasn't explicitly blamed Reef's high-profile food safety violations for the end of the partnership, but it's possible reports of these issues were an inciting incident. The restaurant told Business Insider it had cut ties with the ghost kitchen platform the same week BI reported a former Reef culinary director frequently received consumer complaints about raw Fuku chicken.
A Reef spokesperson attributed Fuku's departure to differences in business models.
"Fuku enjoyed strong ratings on the REEF platform, but not all virtual restaurant models are the same — ours provides a full-stack solution for brands to expand, but some brands will always prefer to maintain their own employees and supply chain," a Reef spokesperson told Restaurant Dive in an email.
The pivot gives Fuku more control of the quality of its ghost kitchen menu items. Kitchen United's model makes restaurant brands responsible for preparing their food at rented kitchens, unlike Reef, which handled the kitchen operations for its licensed brands.
"Fuku is committed to maintaining our high standards of product quality and delivering the best possible experience for our guests," Fuku told BI. "While we are no longer working with Reef Kitchens, we look forward to continuing to grow our footprint with our other partners in 2022 and beyond."
Reef has signed major expansion deals with brands like Wendy's, C3, and TGI Fridays in 2021, bringing its development pipeline to over 2,300 units by 2025. But it has also attracted serious regulatory scrutiny in recent months. Public records in multiple markets showed Reef kitchens frequently faced safety violations, while in some cities they operated without permits.
Alex Munoz-Suarez, Fuku's CEO, emphasized Kitchen United's operational standards in the press release.
"Kitchen United shares our passion for executing a fast-to-market strategy while maintaining incredibly high brand and kitchen operations standards," Munoz-Suarez said.
Kitchen United operates nine units and will open four additional locations this month, followed by five more in January. The company launched in California but has since expanded to New York City, Chicago, and Austin, Texas.
