The early history of Cal Central Catering is in itself a notable success story because of what its owner was able to accomplish. Ignacio Ochoa left Mexico and came to the U.S. in order to establish a better life for himself and his family. In 2002, he started Cal Central Catering operating out of a single food truck. After successfully establishing himself in the local food industry, he wanted to expand by acquiring a second truck. But rather than purchase one of the many models available, he decided to put the skills he had acquired in Mexico to work and build it himself. When the new food truck was completed, his cousin wanted one and then another person approach Ignacio to build him a food trailer.
Ignacio continued to operate his two food trucks and also purchased a local restaurant at the same time he continued to build custom food trucks and trailers “on the side”. As demand for his custom trailers & trucks grew he eventually sold his two food trucks and the restaurant in order to focus 100% on the manufacturing business. Twelve years later and almost by accident, Ignacio found himself the owner/operator of a growing food truck manufacturing business.
Since its founding in 2002, Cal Central Catering has grown steadily, even during the ‘08-‘10 recession. Ignacio’s background of accomplishing a great deal with limited resources, his work ethic and multitasking himself (using his exceptional electrical & mechanical design skills) coupled with his engaging personality were factors that allow him to continue to succeed through the very difficult economic downturn.
At the end of 2012 the company had only five (5) employees. Since 2013, the company has seen a dramatic explosion in growth and they now have 16 employees. The demand for more production capacity eventually exceeded their 13,000 sq. ft. rented facility and multiple production operations were pushed outdoors. Even though work flow was negatively affected, the management team kept things going even as they continued to grow. However, while their sales volume was growing during this time their profit per unit was also dropping. Inefficiencies due to the hodge-podge of expansion, difficulty in managing isolated production employees and the distance from parts and materials for assembly were becoming more costly every month.
It was at this crucial time in 2013 that Ignacio requested assistance from the Alliance SBDC. Ignacio knew the manufacturing processes and the management of the workforce had to be improved. Ignacio turned to his controller, Carlos Osorio, who has been loyal, resourceful and exceptionally astute in financial and operational matters. In late 2014, they decided to hire an experienced production manager and made a commitment to purchase two new needed and expensive computer controlled machining tools.
While working with their SBDC consultant during the final stages of planning for the advanced machine tools they realized their existing facility did not have the required electrical capacity and up-grading at the facility was not an option. When management considered this development and the inefficiencies inherent the current facility, they began to think seriously of relocating to a larger space.
By this time Ignacio & Carlos each had considerable confidence in the SBDC advisors and we were asked to play an even greater role. SBDC was included in evaluating potential sites, reviewed lease proposals, sought sources of capital funding, completed cash flow projections and projected production levels base on a number of scenarios. A critical private loan of $200,000 was secured that allowed the move to be completed. Funding from the State of CA through GOBiz provided the funding that enabled the Alliance SBDC to provide this much needed and deeper level of assistance to Cal Central.
The move, in the summer of 2015, was a tremendous undertaking that took over four weeks to complete. Some of the more specialized and technical departments are even taking longer to set up and some remain a “work in process”. However, tremendous effort by the SBDC and the client continues to be put into developing the efficiencies of this new work environment. Actually, even at this very early date (move was completed in late July 2015) some measurable improvements are already being recorded in two key production departments. The last seven (7) months in the previous facility seven (7) units were completed and they had a backlog of 3 units. In the past month two (2) were completed, five (5) currently in production and there is a backlog of eleven (11) units. Their production goal is to routinely produce three (3) per month within in the next three months.
The SBDC is working diligently to assist in budget development, cash flow projections and help to determine other possible capital loan sources to insure this positive trend continues and the company’s growth is sustainable. With assistance from SBDC consultant Dennis Murphy, Ignacio decided it was best that the two expensive computer controlled production machines should be put on hold for now but will be needed for future growth. Once the business is more stable I the new facility the SBDC and owner will work on securing the needed funding to purchase more advanced equipment to continue to expand the company’s market opportunities. But for now, completing the move into a new 30,000 sq. ft. facility with ALL the company operations in one cohesive environment has been an absolute priority.