April 30, 2025 • 53 mins
Newk's Eatery CEO Frank Paci joins Fast Casual Nation to discuss how the 98-location chain is adapting to major industry shifts. With off-premise sales now representing 55% of their business (including 11% from catering), Newk's is building smaller restaurants, implementing digital ordering solutions, and revamping their catering program. Paci shares insights on their expansion strategy targeting Oklahoma and the Carolinas, their focus on menu innovations like customizable pick-three options, and why fast casual is positioned to continue gaining market share from both QSR and casual dining segments. Don't miss his practical wisdom on franchise partnerships and creating true value for customers in today's competitive landscape.
FastCasualInnovation #CateringGrowth #RestaurantEvolution
Get Your Podcast Now! Are you a hospitality or restaurant industry leader looking to amplify your voice and establish yourself as a thought leader? Look no further than SavorFM, the premier podcast platform designed exclusively for hospitality visionaries like you. Take the next step in your industry leadership journey – visit https://www.savor.fm/
Capital & Advisory: Are you a fast-casual restaurant startup or a technology innovator in the food service industry? Don't miss out on the opportunity to tap into decades of expertise. Reach out to Savor Capital & Advisory now to explore how their seasoned professionals can propel your business forward. Discover if you're eligible to leverage our unparalleled knowledge in food service branding and technology and take your venture to new heights.
Don't wait – amplify your voice or supercharge your startup's growth today with Savor's ecosystem of industry-leading platforms and advisory services. Visit https://www.savor.fm/capital-advisory
FastCasualInnovation #CateringGrowth #RestaurantEvolution
Get Your Podcast Now! Are you a hospitality or restaurant industry leader looking to amplify your voice and establish yourself as a thought leader? Look no further than SavorFM, the premier podcast platform designed exclusively for hospitality visionaries like you. Take the next step in your industry leadership journey – visit https://www.savor.fm/
Capital & Advisory: Are you a fast-casual restaurant startup or a technology innovator in the food service industry? Don't miss out on the opportunity to tap into decades of expertise. Reach out to Savor Capital & Advisory now to explore how their seasoned professionals can propel your business forward. Discover if you're eligible to leverage our unparalleled knowledge in food service branding and technology and take your venture to new heights.
Don't wait – amplify your voice or supercharge your startup's growth today with Savor's ecosystem of industry-leading platforms and advisory services. Visit https://www.savor.fm/capital-advisory
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:00):
All right, we are back here on the Fast Casual
Nation podcast, the one that started it all, and of
course today we're going to be diving into some very
cool information around catering and growing your sales. Joining me,
of course, is miss share Cancer.
Speaker 2 (00:13):
How are you.
Speaker 3 (00:14):
I'm doing great? How are you so?
Speaker 1 (00:16):
I heard you were at Coachella.
Speaker 3 (00:18):
It was I was. It was awesome.
Speaker 4 (00:19):
Three days of live music, lots of food, lots of booze.
Speaker 3 (00:23):
Can't go ver.
Speaker 1 (00:23):
What was What was the best you know artists that
you saw?
Speaker 2 (00:27):
So?
Speaker 4 (00:28):
I mean, obviously there were some cool ones like Lady
Gaga and Post Malone, but my favorite was like Claro.
She's this amazing singer, songwriter, female artist. I love her,
so I was really excited to see her, and she
did in an awesome job. And a Japanese breakfast is
another kind of up and coming artist. So I geeked
out over that, and I also geeked out over the
Fast Casual food. I saw Dave's Hot Chicken, I saw
(00:50):
a Sweet feed.
Speaker 2 (00:51):
Yeah.
Speaker 4 (00:52):
I was like, oh, our guys are our guys are
getting their presence out here.
Speaker 1 (00:56):
I don't know how to hang, which is is the
cool part. Speaking of that, we've got some big announcements
that we have. Last week you put out this story
and of course it is now official that the Perfect
Pitch program at the Fast Casual Summit is going to
also feature some of our front Runner programs. So I
(01:16):
know you guys are open for nominations. This is a
big partnership because we are with Saver, We are investing
a large amount of money into winners of the front Runners.
And the way it works, just so everybody knows and
we're not blamed for warning you guys, is we have
(01:37):
five front runners this year and this is our twenty
twenty five class. There will be a winner and that
winner will be announced at the summit and then we
will select from the Perfect Pitch. The winner of the
Perfect Pitch will be the first class member of twenty
twenty six to compete in the twenty twenty six front
(01:57):
Runner program, where we go in and we make a
documentary about your brand. It is high quality stuff. Then
you get access to capital and our advisory group. So
if you guys are interested, jump over to Fastcasual dot com.
You're going to learn a lot about that. What do
you think was Kathy excited about this?
Speaker 4 (02:15):
Oh? Yeah, we're very excited about it because we usually
do you know, four or five pitches, but partnering with
you guys, we're going to do We're going to do
a sector of the Perfect Pitch every day, all three days.
So hopefully we'll get to hear from you know, up
to these brands, six to eight brands, and then they'll
get the audience, we'll get to vote for their favorite
of course, and then that will be start. They'll be
featured on front Runners. So it's taking it up a notch.
(02:38):
You know, we always have a small cash prize and
great service from Ovation when you know they fund the
winner for that for a year of service. But now
we got you guys involved, so the stakes.
Speaker 2 (02:48):
Are higher big time.
Speaker 1 (02:50):
I mean, you're talking about over two hundred thousand dollars
now in prizes, services, investment available to the winner on
front Runner. So if you're a brand new fast casual
brand and you are trying to make it, you need
to be at the summit and you need to at
least get in that way through Perfect Pitch.
Speaker 3 (03:12):
Obviously, you have nominations.
Speaker 4 (03:14):
Nominations close on June first, so you can go kind
of nominate yourself. The brands have to be less than
seven years old, and they need to have at least
one location open. Other than that, it's basically the criteria,
and that one location could be a food truck or
a ghost kitchen. It doesn't have to be a brick
and mortar. So we'll have a panel advisors. Paul will
be one of our advisors. Kind of it's kind of
(03:35):
our nice version of Shark Take. They'll they'll give their
pitch and then our advisors.
Speaker 2 (03:39):
A nice version.
Speaker 1 (03:40):
We're going to We're going to be brutal.
Speaker 3 (03:41):
We're going to grill you.
Speaker 1 (03:44):
We want the real deal, you know, so when you
when you want the real deal, you got to ask
some hard questions.
Speaker 4 (03:50):
They have to share all their financials and all that jazz,
so it's a big deal.
Speaker 1 (03:55):
Hey share. What is going on in catering technology. I
was noticing this story with James Walker taking the helm
over at Lunchbox, and you know, we've seen a lot
of I won't say divestiture, but there has been some
movement in the space in terms of the tech side
of things. Are you catching any wind on where technology
(04:17):
is going for catering?
Speaker 4 (04:19):
Yeah, I mean there's a lot of stuff going on,
a lot of partnerships. You know, people are combining their businesses,
which we knew they were going to be doing that,
but with James taking over this, this is kind of
cool that he has been in the rush on industry
for so long and his spiel is, you know, he's
done it for so long, so now he's ready to
help rush on brands really learn how to cater and
(04:41):
he knows exactly the technology they need, the help they need,
so that's pretty cool. And they you know, they came
out with they are not charging for order aggregation now,
which I think, well, I think we talked about it
last time.
Speaker 3 (04:53):
I think other companies will kind of go of that
route too.
Speaker 1 (04:55):
You have, don't you have a catering course or something that.
Speaker 4 (04:59):
Yeah, the Catering Workshop at the end of the Fast
Casual Executive Summit in October, so it'll roll right from
the summit into the catering workshop. And we've partnered with
Kelly with Crumb's and Earl from off premise and so
it's more of a workshop, is smaller, like one hundred
and fifty people. We did it last year for the
first time, so people will really get in there and
learn some techniques that they can take back.
Speaker 1 (05:21):
That's cool. Well, speaking of that, we're going to have
Frank Posse join us today from Nukes and dive into that,
so you guys stay tuned right here. My name is
(05:52):
Paul Baron. As the early pioneer in fast casual, I've
seen the industry evolve from just a few operators the
most sought after segment by consumers around the world. Now
we're planning to shape its future. Tap into decades of
my expertise identifying the emerging brands and tech winners in
(06:13):
the space saber capital, we'll be fueling the next generation
of fast casual innovation. All right, we're back here on
Fast Casual Nation, and of course joining us is mister
Frank Posse, who is coming in from Nukes.
Speaker 2 (06:29):
How are you, Frank great, how are you guys doing.
Speaker 1 (06:32):
Nice to see you.
Speaker 2 (06:33):
Nice to see you as well.
Speaker 1 (06:34):
I'm going to reposition you so we've got you a
top billing. First of all, Frank, I know many people
that follow this show. They've been in the fast casual
space for a long time. They probably are good friends
with you most likely. But for the new people that
are coming into the show, because we get a lot
of new operators tell us a little bit about your
story and then give us an update on Nukes.
Speaker 2 (06:56):
Yeah. So I've been in the restaurant business for a
long time, probably longer than I want to admit. Worked
at Berger King and Pizza Hut, and then ultimately was
CEO at McAllister's Delhi, Einstein Bagels and Corner Bakery, and
now I've been at Nukes for four years, so very
(07:18):
familiar with the business. I love, love the business, and
you know, always looking for opportunities on how we can
make our guests happier.
Speaker 1 (07:27):
So listen to your work at Corner Bakery was really
where I started really understanding the kind of executive that
you were, because you were head to head at that
time with the Titan and that was ron shake at Panera, right,
And anybody that can hold your own in that market,
in that category during that phase is a rock star.
(07:49):
So congrats on your career. Where is NUKES today in
terms of size, So.
Speaker 2 (07:55):
We're at ninety eight locations, mainly within this south east
of the US. You know, we've been in business twenty
one years now, and uh, you know, I think we've
got some great opportunities to continue to grow the business.
Speaker 1 (08:11):
So yeah, for sure.
Speaker 3 (08:13):
And you guys just opened a store yesterday.
Speaker 2 (08:15):
You said, we just we just opened the store last
week in Pasco, Google, Mississippi. There you go, you know,
which you know, our first store was actually in Oxford, Mississippi,
So that's our that's one of our core markets, and
it was it was really gratifying to see a chamber
of commerce all came out and uh, we're just thrilled
to have nukes in the in their town. So you know,
(08:38):
when you see those kind of things, that really makes
you want to build. And social media is fantastic because
we'll run we'll run a promotion put on on social
media and you'll get all these people saying, well, when
are you going to bring one to my town, which
is really uh, you know, it's it's it's great to see.
Speaker 1 (08:54):
So, yeah, nice update on the website. Everything's looking super
fresh ready forring, which is a good time for I
think your brand really excels in terms of, you know,
how it connects to consumers. One thing though, that we
are going to talk about today is really dive into
the growth around catering because catering is one of those
(09:14):
sectors and one of the topics that our audience asks
about a lot because it is incremental sales increase for
the most part. What are you guys doing around catering
in general as a strategy right now.
Speaker 2 (09:28):
Well, we have been, you know, really kind of pushing catering.
We were not, I don't know, we were fully invested
in catering when I got here four years ago, and
so you can see the growth of our catering business
has been steadily grown over the last four years. Part
of that has been, you know, embracing the third parties
(09:49):
out there, including easy cater as an opportunity to get
new customers and catering for us. Obviously, we've got long
term relationships with some places, we have sponsorships with some places.
But one of the things that we've also worked on
is is worked on our menu and really some of
it's not very complicated. We just kind of met the
(10:13):
customer on how they wanted to do the business. I
think we were kind of restrictive before in terms of
you have to buy a bundle of this, and you
have to get a dessert when you get this, and
so we've uncoupled those things. We've added, you know, we've
always had great salads, but for whatever reason, we limited
the salads that we offered in catering. So we've now
(10:34):
offered all of our premium salads in catering. You know,
we've added wraps. I mean, one of the things with
catering is you know, how long, how does it travel,
how does it hold? Right? So, fortunately we're in a
business where a lot of our food actually holds really
well and enables you to to still give the guests
(10:56):
a fresh item. And so one of the things we
did was add wraps to the menu, which we hadn't
had before. And with the wraps, we actually added a
Nukes Q wrap. Our signature top selling sandwich is the
Nukes Queue, but it was only ever available before in
kind of in restaurants, so we're able to now add
(11:19):
additional taste to that. We really view the catering program
as a as a profitable sampling opportunity, right, I mean,
we're always looking for ways to connect with new guests
to come into the restaurants. One of the ways is,
you know, we take we take our Nukes food to
the workplace and people get to see the products that
(11:42):
they you know, they might have not tasted them before
and say, well, well wow, I need to know more.
I didn't know about this brand, right, So that's a
we kind of look at it that way. So, uh,
you know, and we've been we've also been looking at
ways to grow including you mentioned kell at Crumbs. We're
working with them to look at things that we can
(12:04):
do to improve our packaging, you know, and get incremental
visibility for the brand.
Speaker 4 (12:10):
So what do you mean I'm preming packaging you mean
like just branding wise, logo wise, or more sustainable or
just keeping the.
Speaker 2 (12:18):
I think a little a little bit of both, right.
I mean it's one of these things is that we've
got I mean, we do a lot of box lunches,
so we're now we do box lunch with sandwich, we
do box lunches with salads now the premium salads that
I was talking about, which was never available before. And
you know, we're also looking at items that would be
(12:39):
good for hot catering. Right, So we have mac and cheese,
so looking at playing off the mac and cheese and
doing kind of premium mac and cheese items that we
could could do as catering, and looking at, you know,
is what's the best presentation for our product? Right, So
that's all part of the part of the deal.
Speaker 3 (12:59):
So why you guys have.
Speaker 5 (13:02):
A lot of options. Yeah, we actually did. Last year
we did a one hundred and fifty pizza catering order,
which we fortunately was in a market where we had multiple.
Speaker 2 (13:13):
Locations, so where we had to kind of to farm
that out to different restaurants to be able to deliver
on them. But yeah, so, uh, you know, and and
it's great. We have great connections with like the utility companies,
so whenever there's a major storm, you know, especially in
the Southeast where you have hurricanes and stuff like that,
(13:34):
we'll do a lot of business where we provide box
lunches to all the all the first respond all the
first responders, yeah that come down, so you know, and
then we we do obviously normal things like the teacher
recognitions and all those kinds of things. So you know,
it's it's really been a focus for us.
Speaker 1 (13:52):
So you mentioned sponsorships, explained that because that's a little different.
Speaker 2 (13:59):
Yeah. So, uh, for example, I mean one of the
things that has always been a core of the Nukes
brand has been Nuke's care. Our founder Chris Nucomb's wife
had ovarian cancer and passed away from it, and so
we have always had, uh you know, a great relationship
with ovarian cancer uh and contributing funds and fundraising for that.
(14:24):
One of the things that we do, as an example
is sponsor uh the Old Miss because again was founded
in Oxford Old Miss women's softball team and uh, you know,
so we kind of color the the field with the
Nukes Cares colors and and I was obviously as part
of that we provide food with that. So I mean
(14:46):
that's another way where you can make inroads by doing
those kinds of things. The other the other things is,
you know, we do spirit Nights with fund with fundraising organization,
and part of that is obviously we fundraised with them
in the store and then hope whenever they're having their
board meetings that they'll they'll get Nukes's catering for part
(15:10):
of those kind of things. So right, so it's a
life cycle in terms of what we're trying to do
with the business there.
Speaker 1 (15:16):
So yeah, well, I think we're seeing a lot of
I think interesting connection with communities and catering as a
very unique at least from all the experts I talk to,
that seems to be one of the probably I would
say one of the biggest things is is how do
you build a connection to that community. Sometimes it's through
(15:40):
programs like what you're talking about with nukes Cares, but
sometimes it's through getting involved in just the community activities
of that which is you know, in way almost like
a local store marketing effort you guys have at each restaurant.
Is there any dedicated team or people or is this
more of a brand level that works on the catering business.
Speaker 2 (16:02):
I mean it's more of a brand level. You may have,
you know, one of the assistant managers be kind of
the lead catering person, one of the other One of
the other things that we've done to grow the catering business.
In the past, it was well you have to have
your order in the day before in order to do
the catering right. So we've cut that down to four
(16:23):
hours ahead of time, and we're looking at trying to
figure out if we can go to two. You know,
one of the challenges becomes that with the short time,
you know, how does it interfere with your in restaurant
business right and so you know, especially since you know
a lot of our business done at lunchtime and a
lot of our restaurants are are very busy illuanche time.
(16:44):
They'll do two and three thousand dollars hours right right.
But what we've what we've been able to do is
is use leverage third parties to actually deliver the catering.
So whether that's deliver that or door dash where it's
not necessarily we're probably we probably do about sixty percent
(17:05):
of the delivery ourselves. We have vans and stores to
do that, but in order to do that last minute catering,
we've got to leverage third parties to be able to
do that so we don't disrupt our lunch business.
Speaker 1 (17:15):
Are you finding more potential solutions out there other than
deliver that? Because I've seen that market it seems to
be very small at least you know, from the third
party side. Are people starting to add that or companies
starting that service?
Speaker 2 (17:31):
I think, you know, one of the opportunities is leveraging
the delivery of the third party delivery guys, right like
door Dash and Owbries because you know, and I know
one of our restaurants he's anytime he sees a DoorDash
d ever that he really likes, he'll say, hey, would
you like to do catering delivery? Right? Because he knows
(17:52):
he can get them deliver their catering at ten or
eleven o'clock before the door dash delivery business really heats up, right,
So it's a way for them to use excess capacity,
if you will, in the third party delivery system. And
the great thing about that is, right, the size of
the order is I mean, our average cater rotor is
(18:12):
you know, two fifty to three hundred dollars, right, It's
you know, you're going to earn a lot more money
on that than you are on you know, a twenty
dollars order that's belayed.
Speaker 1 (18:22):
Yeah, for sure.
Speaker 2 (18:22):
It's So it's a it's things that works for both
the restaurant and the delivery systems, if you will.
Speaker 1 (18:29):
So, I know you guys are growing in terms of franchising.
But when you grow a franchise bace like what Nukes
has been able to do, and you have this kind
of this rising you know, I won't call it a
day part, but this rising part of your menu that
is catering. How do you guys go about the process
(18:51):
of one educating the franchise e and then training them.
Do you guys have like a system or do you
bring in third party trainers.
Speaker 2 (18:59):
What's yeah, we do, we do that internally. In fact,
we just had regional meetings where we had the general
managers of stores. We had three regional meetings, one in Dallas,
one in Jackson, Mississippi or where our support center is,
and one in Atlanta where we were We actually talked
to them about, you know, opportunities. We talk to them
(19:21):
about how to optimize their positioning on something like easy
cater because there are ways to boost your positioning in
terms of how you're marketing within easy cater and ultimately,
at the end of the day, it's about being able
to deliver and because if you score well in the deliveries,
the algorithm helps push you to the top as well. Right,
(19:44):
So they're really kind of just trying to explain that
to them. And you know, we have a we have
a dedicated director of catering, Lose Peerson, who's phenomenal and
you know, franchise He's always available for franchises if they're
looking for of things to do.
Speaker 1 (20:01):
So I think those are when you've got that kind
of focused it usually shows in the brand at the
store level. You know, if you've got a really one
well trained or at least they're passionate about programs.
Speaker 2 (20:19):
Yeah, if you if you look at our culture, right,
our culture is as is always about taking care of
the guests and providing great quality food, and so it's
very consistent with our culture, and I think you know,
they realize it as an additional kind of profit opportunity
as well as a way to get the brand out there.
Speaker 1 (20:38):
Well, I think the the point is now that you know,
catering seems to be one of those areas that has
become a very intriguing thing that won It helps connect
the community, but it also drives a lot of store sales.
Right now, in terms of the mix, if you look
at sales of takeout livery catering is there. Can you
(21:02):
share any numbers on what those are versus in store dining?
Speaker 2 (21:06):
Yeah, Our off premise business is about fifty five percent
of sales, okay, which is a total change from pre COVID.
Pre COVID we were about six percent or sixty percent
dine in forty percent off premise. When you know, when
the pandemic happened, you immediately went to zero on premise.
(21:30):
And what's interesting is, you know we do it stack
bar charts on how much is coming from each segment
on those right, and you could see the off premise
jump and the off premise number never went down. What
happened is the in store business went up, right, And
so it was there was almost a sea change at
that point in time where people who may not have
(21:52):
done that before, all of a sudden realized, hey, this
is a great way to do this, and so it's
just kind of stayed to that on them.
Speaker 3 (22:01):
To do it one time than there is.
Speaker 1 (22:03):
Right, Well, it's changed the it has changed the mindset
of now the fast casual guest and consumer. They they
don't even look at at restaurants the same way anymore.
I you know, when we talk to a lot of
consumer groups when we go out and invest in brands,
the first thing we do is we'll go into a
(22:24):
local like if we're investing here in Miami, we'll go
into a local area and do you know kind of
a lunch thing where people can you know, we on
social media, it's mostly brand people that go to that
brand and we just ask them to come do a
lunch tell us about what they're seeing. So it's like
a consumer focus group. And we did want a couple
of weeks ago and I was surprised at the amount
(22:49):
of mindset shift that has occurred around how they order now.
It's it's so much different to your point, which I
guess supports your fifty five percent you know, right, you're
seeing on takeout well.
Speaker 2 (23:03):
And I think I think ultimately, if you go to
you know, historically, I go back to kind of when
I started this business, right, it's always been about quality, service,
value and convenience, right, And what's changing is how you
define convenience, right. I mean, if you look at QSR,
obviously what seventy to eighty percent of their business has
(23:23):
been through the drive through, So it's always been an
off this business, right, But if you look at casual
dining and fast casual, it's always been more of an
on premise business. But I think people have said, but
that's because they couldn't drive through with those places, right,
But now they've got alternative ways to access that business
in a convenient way, and so they're choosing to do that. Yeah.
(23:46):
I was looking at our sales in the first quarter,
and what I would call digital off premise was, you know,
was one of our areas of growth, right. So that's
including online ordering. You come to the store and pick
it up. That includes delivery if you're doing that, and
that includes curb side. Right. So those three things have
(24:08):
all grown. And what you see declining a little bit
is people used to come to come to the store,
order takeout and go, but they're basically saying, well, why
would I sit there and wait? I can I can
order online? And they used to the other one. They
used to call in. And we've seen, you know, consistently
over the past three years. Yeah, to call in business
(24:29):
drops twenty Yeah.
Speaker 3 (24:31):
Yeah, the gen zs are not calling everything.
Speaker 2 (24:36):
They're not They're not calling, right.
Speaker 4 (24:37):
I always joke that my fifteen year old or rather
starve than have to call a restaurant order.
Speaker 1 (24:42):
Yeah, well, it's like get them on a phone call.
You know, there's thing in a phone call. It's a Well, if.
Speaker 2 (24:48):
We've rolled out kiosks to stores, right, and I think
I went to the first store we rolled out of kiosk, Right,
I'm there watching to see what happens, right, And this
person goes up to the kiosk but there was no lot, right,
there was another cashier that was there ready to take
their order. And I said, well, she's over here, she
can help you. Goes, Oh, no, I'd rather do this
because it's it's the same thing as you see when
(25:10):
people want to test text versus talk on the phone.
Speaker 1 (25:14):
Yeah for sure.
Speaker 2 (25:15):
Yeah, you know, it's just a different different way.
Speaker 1 (25:17):
That it's a shift in minds.
Speaker 2 (25:19):
Yeahs to shift in mindset. So you know, we continue
to see that. So and then catering is about eleven
percent of that fifty, right.
Speaker 1 (25:29):
So that's impressive. Yeah, so these are really good numbers.
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Speaker 2 (25:46):
Over four hundred.
Speaker 1 (25:47):
Thousand businesses choose Gusto every day. And let's get into it, guys.
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com use our link down below to get started. See
you there. Now, with all of this growth off premise,
(27:14):
obviously this surely has changed the way that you build stores.
Speaker 2 (27:18):
Absolutely, So that's that's the next part of that, is that.
Speaker 1 (27:21):
What has changed.
Speaker 2 (27:22):
Yeah, Historically we said we wanted four thousand to forty
five hundred square feet because you needed to have the
seats especially, you know, it is one of these things,
right you need to have that seats from from eleven
to one if you will. Right after that you really
didn't need all those seats, right. But yeah, now, and
you know what's what's fortunate about that? I think that
(27:43):
helps with development because you know, building stores hasn't gotten
any less expensive. The real estate hasn't gotten any less expensive. Right,
So when you start talking about how do you improve
your store level economics, one of the things that we
can do is smaller stores. And we've we've been we've
(28:03):
built stores as small as thirty two hundred square feet now,
and really what that does is the kitchen kind of
remains the same size, although we're looking at ways to
get more efficient in the kitchen design. But what happens
is you just don't need one hundred and forty seats
anymore to service the dine in business.
Speaker 1 (28:21):
Yeah, I'm looking at just you know, on Google images.
You know you've got you know, this one in Miami.
It looks like it's somewhat of an end cap?
Speaker 2 (28:33):
Is that?
Speaker 1 (28:33):
Do you go for end caps mostly? Are you looking
for standalone.
Speaker 2 (28:37):
What, yeah, end cap is probably the easiest. I mean,
we do have some standalones we've got, but you know,
end cap, but we do have some indline locations. But like,
for example, the store I was talking about this thirty
two hundred square feet that opened a year and a
half ago, is an end cap in a in a
strip center. That one actually has a drive through on
(28:57):
it as well. And so okay, yeah, so but you know,
it's it's you know, it's interesting. Even when you put
a drive through on, you get maybe twenty to twenty
five percent of the business goes through the drive through,
and so it's it's never going to be you know,
the seventy percent that you see in the in the
(29:17):
quick service.
Speaker 1 (29:18):
So this one in Houston, sorry, share, I'm kind of curious.
I'm going to bring this up on screen because it's
it's an interesting location and I wanted to see what
you guys did here. So it's that picture right there.
Let me see if I can zoom in on it. Well, yeah,
there you go, it's the it's the my ad blocker
on but it was the one in reference to what's
(29:41):
going on in Houston? What is what is that one? Right,
there on the top right you can kind of see it. It
looks like it was a previous something.
Speaker 2 (29:49):
Yes, well, I'm not sure about this one specifically.
Speaker 1 (29:53):
I don't know which location, but is that a strategy
where you'll go into old restaurant units and refirm them.
Speaker 2 (30:00):
We call it second generation as opposed to old I
guess okay, uh. With the store we just opened in
Pascagoula was previously an eyehop that had closed and we
went in and converted it. Now. It was interesting because
it was much bigger than it was back to the
four thousand square fleet location. But based on the rent
and the fact that you know, there was a freezer
(30:24):
cooler there, there were already hoods there, There are already
restrooms there. They Yeah, actual construction cross was significantly less
than another store.
Speaker 1 (30:34):
So yeah, well these are looking good though. I mean,
you've got a really fresh brand approach. I think that's
that's going to be very you know, very attracting to
the consumer itself. Have you guys done anything recently around
brand redesign.
Speaker 2 (30:51):
We're actually in the process right now of We've got
engaged with a firm that we're looking at. You know,
how do we know what do we like, what do
we you know, what do we need to do to
continue to grow the brand? Right? So that look, the
look that view were shown there is kind of was
a redesign that was done probably like six years ago,
(31:12):
and so you know, we're we're continuing to look at that.
We're also in the process from a technology standpoint of
putting toast as a pos in our restaurants. We've got
a pilot in one of them, and the new store
that just opened opened with toast in it. And that
(31:33):
gets us a couple of things. One kitchen display creen
screens come with that. Historically NUKES has used a ticket
system and so that'll give us some things. The other
thing is is that it gives us a guest facing
screen where the guests can enter their loyalty numbers. So cool,
you know, loyal you know, so right now what they
come in the loyalty number is their phone number. They
(31:55):
have to give it to the cashier. The cashier has
to bring that in, but I always.
Speaker 1 (31:59):
Hate doing that.
Speaker 2 (32:00):
Yeah, so now now we'll have a screen, once we
roll this out, we'll have a where we can do that.
So that's goodness.
Speaker 1 (32:07):
We figured that out.
Speaker 4 (32:09):
We're are going to keep the kiosks in all the
in all new locations.
Speaker 3 (32:14):
Will they all have them?
Speaker 2 (32:15):
Yeah? I think so. Again, I think this is part
of you know, trying to meet the guests on how
they want to access the brand, right, Yeah, and so
you know, one of the one of the strange things
we're you know, we're still struggling with where to figure
out the best place. What's the most efficient place to
put the kiosk. What we've done in a lot of
the retrofits is we put it on the front counter.
(32:37):
But what we see as the guest, I think is
a little bit concerned about am I cutting the line
to go to the kiosk. So we've actually talked about
do we have like a kiosk line and a regular
you know, cashier line so that the person who says, well,
wait a minute, the cashier line is too long, let
me go over to the kiosk. Right, We think about
think about airports and some of those kind of things
(32:58):
where there's different lines for like back drop versus checking in. So, uh,
you know, we're still working on some of those things
to try to figure out how can we do that.
You know, it's an opportunity again, you know, it's it's
a way that the guests can have a better experience.
If the line's too long, they can do that, or
if they want to use the technology versus talking to
(33:19):
a person on those on that So that's a that's
an opportunity and it's also an opportunity during the rush
to you know, have your redeploy your employees to the
kitchen to be able to improve the speed of service
on the on the kitchen times.
Speaker 4 (33:35):
Are you guys seeing people spending more money on their
average check spins with with Kiosk.
Speaker 2 (33:39):
Because I've got yeah, we do see that. You know,
it's still a small percentage of the business, but yeah,
you know you have the opportunity to always up sale
on on that. So I mean, in general, one of
the things that we're saying is, you know, I've always
been a big believer that value for the money is
a great is a great way to talk about it, right,
(34:01):
because when people talk about value, they think they're talking
about low price. Right. We're never going to be the
low price guys out there, but our objective is to
try to figure out how do we give you value
for the money. So one of the things that we've
always had is you know, typically a lot of restaurants
have you know, half sandwich, cup of soup. Right, we've
always had a large sandwich, what we call a large pairing,
(34:24):
where we're gonna have a large sandwich, a pizza with
a caesar salad, all that bundling where you get an
opportunity to get a lot of food for a price. Right.
One of the things we're testing right now is actually
a pick three where you can pick a half sandwich,
cup of soup, salad, mac and cheese, bowl of fruit,
(34:49):
anything you want and pick three of those. And what
we've seen so far is a lot of people are
picking like a half nukes que and a half roast
beef sandwich and a cup of soup. So it's really fascinating.
We started looking at some of the numbers on this
is just something we've done here in the last month,
and it's like a third of the orders are having
(35:09):
two different sandwiches on it, right, So it's a variety. Yeah.
So yeah, you know, you talk about variety, you talk
about value, and you know that's you know, when we
looked at it, we said, wait a minute, we're doing
a full sandwich and a cup of soup. What's the
difference between doing two half sandwiches and a cup of soup? Right, So,
so it's the same price of our as our large pairing.
And so we have seen guests move from just ordering
(35:33):
a sandwich with a side to ordering in these pairings,
which you know drives the average check and the penny
profit per transaction.
Speaker 1 (35:42):
So expansion wise, I saw on the list you had Carolina's.
I also saw Oklahoma in there.
Speaker 2 (35:49):
Is that?
Speaker 1 (35:51):
What what are the states for strategy for you?
Speaker 2 (35:53):
Yeah, what we've looked at is, you know, I think
the great way to grow the brand is to grow
kind of from the core, right. So when you look
at we're in Arkansas, we're in Texas right, moving to Oklahoma,
because there are a lot of people in those states
who know the brand right. And when we see, as
I mentioned before in social media, when we get these
(36:14):
comments about when's the brand coming here, a lot of
those are places like the Carolina So at one point
in time, we did have we do have a store
in South Carolina. We don't have anything in North Carolina
right now. We did have a couple stores there, but
a franchisee had some health challenges and ended up having
to close those stores. That was kind of pre pandemic.
(36:34):
Plus we had some stores that closed as a result
of the pandemic. So we know that the brand works
in those markets, and so it's really kind of growing
from there. I think it's it's easier to do that
than to go to some place like Minnesota where very
few people know the brand. Right, So that's really what
we're looking for.
Speaker 1 (36:52):
Well, you're also getting into some pretty competitive areas because
I know Oklahoma has a lot of mcallisters. Go head
to head with those guys.
Speaker 2 (37:02):
Well, we love going ahead, I know, I know which
is good.
Speaker 1 (37:06):
We like competition. It only shows how good we are.
Speaker 2 (37:11):
That's right. Well, it's it's interesting because we do you know, well,
we talked about Pascagoula and Oxford, Mississippi. We do well
in those towns, but we actually do really well in
Atlanta as well, which is you know, is a very
competitive restaurant. Yes, we've got we've got some great stores
in Atlanta, in the perimeter area, in Canton, in Smyrna,
(37:33):
in you know places down South noon in so we
we we do really well in those places. So that
may that gives me the confidence that we can go
into some of these markets. We actually have a we
have a great franchise in the Baltimore that does really well.
So yeah, so I feel like the brand can expand there.
Speaker 1 (37:55):
I know Sherah has a ton of questions here.
Speaker 4 (37:57):
I was just thinking, well, you know, when's Kansas City coming.
That's hours.
Speaker 2 (38:04):
We're actually having a conversation right now with a potential
franchise in Wichita, So you.
Speaker 1 (38:08):
Know that's always from Kansas City.
Speaker 4 (38:12):
Ye hours, three hours, we're creeping up there. Yeah, like
you one, then it's a lot easier to start sprinklin
stretch sprinklined out.
Speaker 1 (38:23):
Right where you get into the into those markets I think,
which are very friendly to you know, to brands like yours,
you know, and and you know many people. I think
a lot of fast casual concepts, I know, Sharon and
I have been interviewing quite a few that are either
east coast, West coast, you know. And it seems like
most of the growth though, is happening in the interior,
(38:49):
whether you look at Midwest, the southwest, the southeast, UH
is really growing heavy right now in the fast casual sector.
Beyond that, as far as the future of the sector itself,
You've been you know, You've had a chance to work
with many brands in the sector, and you look at
this really kind of a quantum shift almost in the
consumer just in the last you know, five six years now.
(39:14):
Frank would you what would you say if you were
just entering the business today, How would you go about
it today? Because it's a it seems to me like
it's a completely different business today.
Speaker 2 (39:24):
Yeah, it certainly is. And I think you know, fortunately
for us, our menu works really well for the off
premise business. Right. So as I start thinking about now,
I've people talk about, you know, when are when are
French fries ever going to be good delivered? Right? I mean,
as you think about those kind of things, yeah, so
(39:45):
you yeah, to me, it's about you know, having a
having a menu. First of all, I think, you know,
people want to eat healthier, they want to have fresh items,
they want to I think they want to have stuff
that travels well. Uh, and I you want to have uh,
you know, I think a broad enough menu to you know,
(40:06):
cast the net wide enough, but not too complex operationally
so you can't execute it, right, I mean one of them.
I mean one of the challenges in the business is
getting getting the right employees right, And it's always been
an employee business, and you think about you know, I
used to think about this all the time. You know,
you've got for us, you know, some of our high
volume stores are four million dollars, right and basically being
(40:30):
run with you know people who some of them are
turning over a one hundred percent a year. Right, So
how do you right, how do you get the training
to be or how do you make the systems so
easy that you can deal with that and still deliver
a quality product? Right? So looking for ways to you know,
(40:50):
I've always looked at I've tended to look at products
and saying, okay, great, what's the what's the differentiation in
my product? And what's the operational complex city? Right? Because
I can you know, if I'm a five star restaurant,
I can do you know, great differentiation and great complexity.
But for us, it's how do I get a product
(41:10):
that's a differentiated product that is easy to do? I mean,
and I'll go back to the nukes Q rap as
an example. Right, It's easy to do a wrap and
all we're doing is we're putting our signature barbecue sauce
on that, right, and or make that our product. Right.
Speaker 4 (41:26):
So so you guys, you said you have almost one hundred,
So what's the goal are you hoping to you know,
double in size or at twenty five or what is
like the crystal ball?
Speaker 2 (41:36):
Well, you know you talked about mcousers. You know, I'm
familiar with that having worked there for four years. And
NUKES was also founded by the same family that founded mcousers, Right,
So I look at I look at them as a
proxy to say, you know, how many units they have
and in our footprint, I think they've got over four
hundred units, So there's no reason that we can't double
(41:57):
the size of the business. Interesting, Okay, the toughest part
for us is just getting the right franchise partners, right,
because you know, there's a lot of franchise businesses out there,
and there's a lot of hot concepts, and as you know,
there's a lot of hot concepts that come out and
do well for a while and then flame out, and
then you've got concept like ours that's been around for
(42:18):
twenty one years.
Speaker 4 (42:18):
Right, Are you guys partnering with any of those, you know,
the franchise growers, the concepts that help you find franchisees.
Speaker 3 (42:25):
Are you just kind of doing it on your own.
Speaker 2 (42:27):
Right now, we have been doing it on our own.
As you know, we got acquired by Capital Spring, which
has kind of partnered up with FSC, so we're like
sister companies, and so we're sharing some resources. So we're
sharing some construction resources, franchise sales, we're like upping our
(42:49):
franchise sales investment with people and advertising, and so continue
to look at But I think there's also a trying
to identify in the market. I mean, I go back
to my experience, some of the best franchises we had
were people who had other concepts, whether that be in
El Paso or in Milwaukee or whatever, who then want
(43:12):
to diversify themselves and are looking for other concepts to
diversify with. So I think there are people that we
can try to identify and directly approach to do that
because they know what the good real estate looks like
in that mark.
Speaker 1 (43:25):
Well, yeah, you're exactly right. You're in the south mid midwest, Southwest,
So but you look at the brands that are very
populated in there that might align but not be competitive,
would be the Sonic franchisee.
Speaker 2 (43:43):
Right, Well, it's interesting our newest one of our newest franchises,
who now already built two locations, was formerly a Popeyes
franchisee okay, all right, and so you know you had
multi unit Popeyes. He ended up selling that one to
get into the fast casual segment. I think the other
thing is is some of the operators of the casual
(44:05):
dining brands, whether that be Comblebee's or Fridays or whatever, right,
who want to diversify and get in the fast casual
I think we're a great fit for those folks because
there is still an element of the hospitality and a
little bit of more complexity in the operations than some
of the other concepts that are out there. But you
don't have to deal with alcohol and fryers. And you
(44:28):
know from a lifestyle, right, you're not open until one
in the morning, as you are in casual dining were
typically closed at nine o'clock at night, right, So yeah,
I think it's it's an opportunity for those kind of
franchisees to diversify with our brand.
Speaker 1 (44:41):
So, Frank, we're going to get you on the last question,
and that is to talk about kind of the vision
for the sector and if you you know, with your expertise,
your your ability to work with some of what I
think are some of the best brands in the business
right now, at least in the ask casual side. When
(45:01):
you look out over the next five years, what do
you think is set up for this sector? Because many
people have said there's too many brands, there's too much option,
we're going to see there's arguments around this. I talked
to Jim Baylis. We're a capitalist spring, just not too
long and he's talking about that very thing of maybe
we're going to see some consolidation. But what are your
(45:22):
thoughts on where this market can go?
Speaker 2 (45:25):
Yeah, I do think, you know, there's a lot of competition, right,
we have I mean a couple of things go on, right.
Trade areas change over time, right, so we have stores
that close because what may have been the hot trade
area at one point in time is no longer the
hot trade area, right. So I do think there's opportunities
like that. As we talked about their second generation opportunities,
(45:47):
I think they'll be kind of winners and losers. I think,
you know, it's interesting to watch across the different business sectors. Right.
You've seen bankruptcies in red Lobster and Buka and all
those folks right where those people go to eat, right,
And so I do think that Fast Casual has an
(46:10):
opportunity to continue to take market share, continue to get
you know, people who kind of grow out of the
QSR business and wants something better but don't necessarily want
to make the time commitment to go to casual dining,
right and so and you have people that you know,
(46:32):
the other part of this is looking at the economics
and how much does it cost to eat? And you know,
everybody talks about I mean what we've seen with the
inflation and the prices, and you know a lot of
the industry data talks about people eating more at home.
I don't know that that's a long term trend. I
think that's a reaction to what it is. And then
after a while you get used to the pricing and
(46:57):
you can do those you know, so you kind of
go back to that. So I do think Fast Casual
is actually pretty well prepared, and this in terms of
quality of food convenience. Right. So one of the things
that we've always lacked behind, say QSR is the convenience.
So continuing to look at whether it's delivery, take out,
(47:17):
curbside ways to be more convenient and give you really
value for the money. Right. Yeah. The kind of things
that we're doing is to say, hey, we don't want
to charge you a lot for a little. We want
to give you a good value. Because I've heard people say, well,
pick three, what happens that people decide they want to share.
I don't care if they want to share, as long
(47:38):
as they come back every day. Right, If you believe
that's a good deal for you, and you weren't coming
to us before because we weren't a good deal, that's
that's acceptable to me. Right, I'm making money off of that.
I don't need to get that because I mean that's
always been one of the concerns you hear from franchisees
when you start doing some of these deals. Oh yeah, right,
(48:01):
Oh what happens if they share it? Yeah? I care
they came into your restaurant. Be happy for God's sakes. Right.
Speaker 1 (48:07):
Well, And that's the thing I think a lot of
operators lose sense of, is you know, the lifetime value
of a guest is often overlooked and just how important
that is to really make it in this business. You know,
we see it all the time. We are definitely going
to be keeping an eye on you though. I think
nukes Is is kind of one of those up and
(48:28):
comers in terms of especially in the bakery bakery cafe
kind of concepts out there. So congrats on everything you
guys are doing over there.
Speaker 4 (48:37):
And nukes Is made the Fast Casual Top one hundred lists,
so we're out in a couple you know, in a
few weeks where they ranked, So that's always exciting.
Speaker 2 (48:46):
Also, that's very exciting for us though.
Speaker 1 (48:48):
I love it. Anyway, thanks for coming in on the
show today.
Speaker 2 (48:50):
All right, thanks for having me. This is this is great,
you know, I mean, I love talking about the industry.
Speaker 1 (48:55):
So you've got thanks for coming around.
Speaker 2 (48:57):
All right, appreciate it.
Speaker 1 (48:58):
All right, all right, so another great interview from you
know what I think are you know some of the
industry experts that are running these brands, you know, they
get a chance to really kind of dive deep on
this shows.
Speaker 3 (49:11):
OG for sure a fast O G.
Speaker 1 (49:14):
What do you think about bakery cafe right now in
terms of if you look at the categories, how does
it rank?
Speaker 3 (49:20):
I think it's it's coming up people.
Speaker 4 (49:22):
To Frank's point earlier, people are wanting more fresh options.
So I think it's hot right now, and I think
we're going to we're going to see some more exciting stuff,
especially from Nukes and some other brands like them.
Speaker 1 (49:33):
Well, it was it kind of fell out of favor
for a little bit. You know. I think we saw
fresh mechs rose, then we saw the chicken. You know,
chains really get at chicken. And yeah, pizza of course
had its light. You know, everybody's had there. But it
seems like it's cycling back through where maybe there's some
new brand discovery from this new generation.
Speaker 2 (49:53):
You know.
Speaker 4 (49:54):
Yeah. Well and like just like what Frank said about,
you know, going with the wraps, so I mean that
it's a smart move. It's the same ingredients and just
wanting to wrap an easy way to add something new
to the menu without a bunch of extra hues. So
I thought that was very smart.
Speaker 1 (50:09):
Speaking of shaping the future of Fast Casual, you guys
should make sure that you attend this event this year,
and that of course is going to be the Fast
Casual Executive Summit in Austin, Texas this year. Shera, can
you share any good news about what's going to happen here?
Speaker 3 (50:28):
We have a ton of great news. You can see that.
Speaker 4 (50:31):
We have our keynote set, which is going to be
a really cool story of Chef.
Speaker 3 (50:36):
Bryant and Danielle Williams. They're a power couple. They have
a really interesting story where they.
Speaker 4 (50:40):
Came from kind of homelessness to up and coming. So
they've got a couple of restaurants. Yeah, it's really cool.
And so you know, we have a lot of our
saying people that we get to speak about, you know, people.
Speaker 3 (50:53):
Like Kelly Roddy and Susan Taylor.
Speaker 4 (50:56):
But we have a lot of newer people too that
haven't been on the age and yet we're really trying
to make sure we have some new faces and some
new brands so everybody gets a chance to learn from everybody.
Speaker 1 (51:07):
What is this book a room venue?
Speaker 2 (51:10):
Oh?
Speaker 4 (51:11):
Yeah, is going to be it's at click it It's
at the Marriott.
Speaker 1 (51:18):
Okay, so yeah, okay, Oh this is a good hotel.
Speaker 4 (51:22):
Yeah, it's gorgeous. And then we will have the catering
summit right after that. We'll close up on the fast
Casual smit on the seventh and roll right into the
catering opening reception and keynote.
Speaker 3 (51:34):
So it'll be good. You can come for all everything
or just one so.
Speaker 4 (51:38):
Top are hopefully Yeah, you know there's the right.
Speaker 1 (51:43):
What a beautiful skyline that is. Listen, you guys got
to be.
Speaker 2 (51:48):
There for sure.
Speaker 1 (51:50):
Yeah, I love it. It's going to be there. I'll
be there. We're going to be filming this podcast. There
a lot of cool be covering. We're gonna have so
much fun. Perfect Pitch is going to be unbelievable this year.
Speaker 3 (52:05):
Crazy. Yeah, this is going to be.
Speaker 1 (52:07):
The go to event. I think.
Speaker 3 (52:09):
I think so too, And I'm so excited about the
Perfect Pitch.
Speaker 4 (52:12):
Usually when only have it, like the one hour, but
we're having so we'll have three or four brands go
the first day and then we'll pick a winner. Then
we'll have three or four brands go the second day,
and then the attendees will pick a winner. And then
the final day those two will go ahead to head
and then the audience vote.
Speaker 3 (52:27):
Maybe we'll vote for the ultimate who will.
Speaker 1 (52:29):
Be a So this is going to be so much
fun anyway, all right, guys, we're going to catch you
next week right here on Fast Casual Nation. Make sure
and subscribe to the show. If you're watching this on
YouTube right now. It a like and of course, give
us a comment. We always love to gift those if
you are listening to the audio podcasts, because I know
some of you guys are driving or working and you're
over on Spotify, you're over on Apple. When you get
(52:50):
a chance, take a little moment and just give us
a star or give us a little recommendation on any
of those podcast apps out there. We're also available over
on iHeart Radios for some of you listeners. By the way,
iheartradiou started moving up the charts on our audio podcast.
I don't know why, so watch out for the iHeart guys.
(53:13):
We'll see what's going on. Good seeing you share. We'll
catch you next
Speaker 4 (53:17):
Week, see you next week, all right, by bye,
All right, we are back here on the Fast Casual
Nation podcast, the one that started it all, and of
course today we're going to be diving into some very
cool information around catering and growing your sales. Joining me,
of course, is miss share Cancer.
Speaker 2 (00:13):
How are you.
Speaker 3 (00:14):
I'm doing great? How are you so?
Speaker 1 (00:16):
I heard you were at Coachella.
Speaker 3 (00:18):
It was I was. It was awesome.
Speaker 4 (00:19):
Three days of live music, lots of food, lots of booze.
Speaker 3 (00:23):
Can't go ver.
Speaker 1 (00:23):
What was What was the best you know artists that
you saw?
Speaker 2 (00:27):
So?
Speaker 4 (00:28):
I mean, obviously there were some cool ones like Lady
Gaga and Post Malone, but my favorite was like Claro.
She's this amazing singer, songwriter, female artist. I love her,
so I was really excited to see her, and she
did in an awesome job. And a Japanese breakfast is
another kind of up and coming artist. So I geeked
out over that, and I also geeked out over the
Fast Casual food. I saw Dave's Hot Chicken, I saw
(00:50):
a Sweet feed.
Speaker 2 (00:51):
Yeah.
Speaker 4 (00:52):
I was like, oh, our guys are our guys are
getting their presence out here.
Speaker 1 (00:56):
I don't know how to hang, which is is the
cool part. Speaking of that, we've got some big announcements
that we have. Last week you put out this story
and of course it is now official that the Perfect
Pitch program at the Fast Casual Summit is going to
also feature some of our front Runner programs. So I
(01:16):
know you guys are open for nominations. This is a
big partnership because we are with Saver, We are investing
a large amount of money into winners of the front Runners.
And the way it works, just so everybody knows and
we're not blamed for warning you guys, is we have
(01:37):
five front runners this year and this is our twenty
twenty five class. There will be a winner and that
winner will be announced at the summit and then we
will select from the Perfect Pitch. The winner of the
Perfect Pitch will be the first class member of twenty
twenty six to compete in the twenty twenty six front
(01:57):
Runner program, where we go in and we make a
documentary about your brand. It is high quality stuff. Then
you get access to capital and our advisory group. So
if you guys are interested, jump over to Fastcasual dot com.
You're going to learn a lot about that. What do
you think was Kathy excited about this?
Speaker 4 (02:15):
Oh? Yeah, we're very excited about it because we usually
do you know, four or five pitches, but partnering with
you guys, we're going to do We're going to do
a sector of the Perfect Pitch every day, all three days.
So hopefully we'll get to hear from you know, up
to these brands, six to eight brands, and then they'll
get the audience, we'll get to vote for their favorite
of course, and then that will be start. They'll be
featured on front Runners. So it's taking it up a notch.
(02:38):
You know, we always have a small cash prize and
great service from Ovation when you know they fund the
winner for that for a year of service. But now
we got you guys involved, so the stakes.
Speaker 2 (02:48):
Are higher big time.
Speaker 1 (02:50):
I mean, you're talking about over two hundred thousand dollars
now in prizes, services, investment available to the winner on
front Runner. So if you're a brand new fast casual
brand and you are trying to make it, you need
to be at the summit and you need to at
least get in that way through Perfect Pitch.
Speaker 3 (03:12):
Obviously, you have nominations.
Speaker 4 (03:14):
Nominations close on June first, so you can go kind
of nominate yourself. The brands have to be less than
seven years old, and they need to have at least
one location open. Other than that, it's basically the criteria,
and that one location could be a food truck or
a ghost kitchen. It doesn't have to be a brick
and mortar. So we'll have a panel advisors. Paul will
be one of our advisors. Kind of it's kind of
(03:35):
our nice version of Shark Take. They'll they'll give their
pitch and then our advisors.
Speaker 2 (03:39):
A nice version.
Speaker 1 (03:40):
We're going to We're going to be brutal.
Speaker 3 (03:41):
We're going to grill you.
Speaker 1 (03:44):
We want the real deal, you know, so when you
when you want the real deal, you got to ask
some hard questions.
Speaker 4 (03:50):
They have to share all their financials and all that jazz,
so it's a big deal.
Speaker 1 (03:55):
Hey share. What is going on in catering technology. I
was noticing this story with James Walker taking the helm
over at Lunchbox, and you know, we've seen a lot
of I won't say divestiture, but there has been some
movement in the space in terms of the tech side
of things. Are you catching any wind on where technology
(04:17):
is going for catering?
Speaker 4 (04:19):
Yeah, I mean there's a lot of stuff going on,
a lot of partnerships. You know, people are combining their businesses,
which we knew they were going to be doing that,
but with James taking over this, this is kind of
cool that he has been in the rush on industry
for so long and his spiel is, you know, he's
done it for so long, so now he's ready to
help rush on brands really learn how to cater and
(04:41):
he knows exactly the technology they need, the help they need,
so that's pretty cool. And they you know, they came
out with they are not charging for order aggregation now,
which I think, well, I think we talked about it
last time.
Speaker 3 (04:53):
I think other companies will kind of go of that
route too.
Speaker 1 (04:55):
You have, don't you have a catering course or something that.
Speaker 4 (04:59):
Yeah, the Catering Workshop at the end of the Fast
Casual Executive Summit in October, so it'll roll right from
the summit into the catering workshop. And we've partnered with
Kelly with Crumb's and Earl from off premise and so
it's more of a workshop, is smaller, like one hundred
and fifty people. We did it last year for the
first time, so people will really get in there and
learn some techniques that they can take back.
Speaker 1 (05:21):
That's cool. Well, speaking of that, we're going to have
Frank Posse join us today from Nukes and dive into that,
so you guys stay tuned right here. My name is
(05:52):
Paul Baron. As the early pioneer in fast casual, I've
seen the industry evolve from just a few operators the
most sought after segment by consumers around the world. Now
we're planning to shape its future. Tap into decades of
my expertise identifying the emerging brands and tech winners in
(06:13):
the space saber capital, we'll be fueling the next generation
of fast casual innovation. All right, we're back here on
Fast Casual Nation, and of course joining us is mister
Frank Posse, who is coming in from Nukes.
Speaker 2 (06:29):
How are you, Frank great, how are you guys doing.
Speaker 1 (06:32):
Nice to see you.
Speaker 2 (06:33):
Nice to see you as well.
Speaker 1 (06:34):
I'm going to reposition you so we've got you a
top billing. First of all, Frank, I know many people
that follow this show. They've been in the fast casual
space for a long time. They probably are good friends
with you most likely. But for the new people that
are coming into the show, because we get a lot
of new operators tell us a little bit about your
story and then give us an update on Nukes.
Speaker 2 (06:56):
Yeah. So I've been in the restaurant business for a
long time, probably longer than I want to admit. Worked
at Berger King and Pizza Hut, and then ultimately was
CEO at McAllister's Delhi, Einstein Bagels and Corner Bakery, and
now I've been at Nukes for four years, so very
(07:18):
familiar with the business. I love, love the business, and
you know, always looking for opportunities on how we can
make our guests happier.
Speaker 1 (07:27):
So listen to your work at Corner Bakery was really
where I started really understanding the kind of executive that
you were, because you were head to head at that
time with the Titan and that was ron shake at Panera, right,
And anybody that can hold your own in that market,
in that category during that phase is a rock star.
(07:49):
So congrats on your career. Where is NUKES today in
terms of size, So.
Speaker 2 (07:55):
We're at ninety eight locations, mainly within this south east
of the US. You know, we've been in business twenty
one years now, and uh, you know, I think we've
got some great opportunities to continue to grow the business.
Speaker 1 (08:11):
So yeah, for sure.
Speaker 3 (08:13):
And you guys just opened a store yesterday.
Speaker 2 (08:15):
You said, we just we just opened the store last
week in Pasco, Google, Mississippi. There you go, you know,
which you know, our first store was actually in Oxford, Mississippi,
So that's our that's one of our core markets, and
it was it was really gratifying to see a chamber
of commerce all came out and uh, we're just thrilled
to have nukes in the in their town. So you know,
(08:38):
when you see those kind of things, that really makes
you want to build. And social media is fantastic because
we'll run we'll run a promotion put on on social
media and you'll get all these people saying, well, when
are you going to bring one to my town, which
is really uh, you know, it's it's it's great to see.
Speaker 1 (08:54):
So, yeah, nice update on the website. Everything's looking super
fresh ready forring, which is a good time for I
think your brand really excels in terms of, you know,
how it connects to consumers. One thing though, that we
are going to talk about today is really dive into
the growth around catering because catering is one of those
(09:14):
sectors and one of the topics that our audience asks
about a lot because it is incremental sales increase for
the most part. What are you guys doing around catering
in general as a strategy right now.
Speaker 2 (09:28):
Well, we have been, you know, really kind of pushing catering.
We were not, I don't know, we were fully invested
in catering when I got here four years ago, and
so you can see the growth of our catering business
has been steadily grown over the last four years. Part
of that has been, you know, embracing the third parties
(09:49):
out there, including easy cater as an opportunity to get
new customers and catering for us. Obviously, we've got long
term relationships with some places, we have sponsorships with some places.
But one of the things that we've also worked on
is is worked on our menu and really some of
it's not very complicated. We just kind of met the
(10:13):
customer on how they wanted to do the business. I
think we were kind of restrictive before in terms of
you have to buy a bundle of this, and you
have to get a dessert when you get this, and
so we've uncoupled those things. We've added, you know, we've
always had great salads, but for whatever reason, we limited
the salads that we offered in catering. So we've now
(10:34):
offered all of our premium salads in catering. You know,
we've added wraps. I mean, one of the things with
catering is you know, how long, how does it travel,
how does it hold? Right? So, fortunately we're in a
business where a lot of our food actually holds really
well and enables you to to still give the guests
(10:56):
a fresh item. And so one of the things we
did was add wraps to the menu, which we hadn't
had before. And with the wraps, we actually added a
Nukes Q wrap. Our signature top selling sandwich is the
Nukes Queue, but it was only ever available before in
kind of in restaurants, so we're able to now add
(11:19):
additional taste to that. We really view the catering program
as a as a profitable sampling opportunity, right, I mean,
we're always looking for ways to connect with new guests
to come into the restaurants. One of the ways is,
you know, we take we take our Nukes food to
the workplace and people get to see the products that
(11:42):
they you know, they might have not tasted them before
and say, well, well wow, I need to know more.
I didn't know about this brand, right, So that's a
we kind of look at it that way. So, uh,
you know, and we've been we've also been looking at
ways to grow including you mentioned kell at Crumbs. We're
working with them to look at things that we can
(12:04):
do to improve our packaging, you know, and get incremental
visibility for the brand.
Speaker 4 (12:10):
So what do you mean I'm preming packaging you mean
like just branding wise, logo wise, or more sustainable or
just keeping the.
Speaker 2 (12:18):
I think a little a little bit of both, right.
I mean it's one of these things is that we've
got I mean, we do a lot of box lunches,
so we're now we do box lunch with sandwich, we
do box lunches with salads now the premium salads that
I was talking about, which was never available before. And
you know, we're also looking at items that would be
(12:39):
good for hot catering. Right, So we have mac and cheese,
so looking at playing off the mac and cheese and
doing kind of premium mac and cheese items that we
could could do as catering, and looking at, you know,
is what's the best presentation for our product? Right, So
that's all part of the part of the deal.
Speaker 3 (12:59):
So why you guys have.
Speaker 5 (13:02):
A lot of options. Yeah, we actually did. Last year
we did a one hundred and fifty pizza catering order,
which we fortunately was in a market where we had multiple.
Speaker 2 (13:13):
Locations, so where we had to kind of to farm
that out to different restaurants to be able to deliver
on them. But yeah, so, uh, you know, and and
it's great. We have great connections with like the utility companies,
so whenever there's a major storm, you know, especially in
the Southeast where you have hurricanes and stuff like that,
(13:34):
we'll do a lot of business where we provide box
lunches to all the all the first respond all the
first responders, yeah that come down, so you know, and
then we we do obviously normal things like the teacher
recognitions and all those kinds of things. So you know,
it's it's really been a focus for us.
Speaker 1 (13:52):
So you mentioned sponsorships, explained that because that's a little different.
Speaker 2 (13:59):
Yeah. So, uh, for example, I mean one of the
things that has always been a core of the Nukes
brand has been Nuke's care. Our founder Chris Nucomb's wife
had ovarian cancer and passed away from it, and so
we have always had, uh you know, a great relationship
with ovarian cancer uh and contributing funds and fundraising for that.
(14:24):
One of the things that we do, as an example
is sponsor uh the Old Miss because again was founded
in Oxford Old Miss women's softball team and uh, you know,
so we kind of color the the field with the
Nukes Cares colors and and I was obviously as part
of that we provide food with that. So I mean
(14:46):
that's another way where you can make inroads by doing
those kinds of things. The other the other things is,
you know, we do spirit Nights with fund with fundraising organization,
and part of that is obviously we fundraised with them
in the store and then hope whenever they're having their
board meetings that they'll they'll get Nukes's catering for part
(15:10):
of those kind of things. So right, so it's a
life cycle in terms of what we're trying to do
with the business there.
Speaker 1 (15:16):
So yeah, well, I think we're seeing a lot of
I think interesting connection with communities and catering as a
very unique at least from all the experts I talk to,
that seems to be one of the probably I would
say one of the biggest things is is how do
you build a connection to that community. Sometimes it's through
(15:40):
programs like what you're talking about with nukes Cares, but
sometimes it's through getting involved in just the community activities
of that which is you know, in way almost like
a local store marketing effort you guys have at each restaurant.
Is there any dedicated team or people or is this
more of a brand level that works on the catering business.
Speaker 2 (16:02):
I mean it's more of a brand level. You may have,
you know, one of the assistant managers be kind of
the lead catering person, one of the other One of
the other things that we've done to grow the catering business.
In the past, it was well you have to have
your order in the day before in order to do
the catering right. So we've cut that down to four
(16:23):
hours ahead of time, and we're looking at trying to
figure out if we can go to two. You know,
one of the challenges becomes that with the short time,
you know, how does it interfere with your in restaurant
business right and so you know, especially since you know
a lot of our business done at lunchtime and a
lot of our restaurants are are very busy illuanche time.
(16:44):
They'll do two and three thousand dollars hours right right.
But what we've what we've been able to do is
is use leverage third parties to actually deliver the catering.
So whether that's deliver that or door dash where it's
not necessarily we're probably we probably do about sixty percent
(17:05):
of the delivery ourselves. We have vans and stores to
do that, but in order to do that last minute catering,
we've got to leverage third parties to be able to
do that so we don't disrupt our lunch business.
Speaker 1 (17:15):
Are you finding more potential solutions out there other than
deliver that? Because I've seen that market it seems to
be very small at least you know, from the third
party side. Are people starting to add that or companies
starting that service?
Speaker 2 (17:31):
I think, you know, one of the opportunities is leveraging
the delivery of the third party delivery guys, right like
door Dash and Owbries because you know, and I know
one of our restaurants he's anytime he sees a DoorDash
d ever that he really likes, he'll say, hey, would
you like to do catering delivery? Right? Because he knows
(17:52):
he can get them deliver their catering at ten or
eleven o'clock before the door dash delivery business really heats up, right,
So it's a way for them to use excess capacity,
if you will, in the third party delivery system. And
the great thing about that is, right, the size of
the order is I mean, our average cater rotor is
(18:12):
you know, two fifty to three hundred dollars, right, It's
you know, you're going to earn a lot more money
on that than you are on you know, a twenty
dollars order that's belayed.
Speaker 1 (18:22):
Yeah, for sure.
Speaker 2 (18:22):
It's So it's a it's things that works for both
the restaurant and the delivery systems, if you will.
Speaker 1 (18:29):
So, I know you guys are growing in terms of franchising.
But when you grow a franchise bace like what Nukes
has been able to do, and you have this kind
of this rising you know, I won't call it a
day part, but this rising part of your menu that
is catering. How do you guys go about the process
(18:51):
of one educating the franchise e and then training them.
Do you guys have like a system or do you
bring in third party trainers.
Speaker 2 (18:59):
What's yeah, we do, we do that internally. In fact,
we just had regional meetings where we had the general
managers of stores. We had three regional meetings, one in Dallas,
one in Jackson, Mississippi or where our support center is,
and one in Atlanta where we were We actually talked
to them about, you know, opportunities. We talk to them
(19:21):
about how to optimize their positioning on something like easy
cater because there are ways to boost your positioning in
terms of how you're marketing within easy cater and ultimately,
at the end of the day, it's about being able
to deliver and because if you score well in the deliveries,
the algorithm helps push you to the top as well. Right,
(19:44):
So they're really kind of just trying to explain that
to them. And you know, we have a we have
a dedicated director of catering, Lose Peerson, who's phenomenal and
you know, franchise He's always available for franchises if they're
looking for of things to do.
Speaker 1 (20:01):
So I think those are when you've got that kind
of focused it usually shows in the brand at the
store level. You know, if you've got a really one
well trained or at least they're passionate about programs.
Speaker 2 (20:19):
Yeah, if you if you look at our culture, right,
our culture is as is always about taking care of
the guests and providing great quality food, and so it's
very consistent with our culture, and I think you know,
they realize it as an additional kind of profit opportunity
as well as a way to get the brand out there.
Speaker 1 (20:38):
Well, I think the the point is now that you know,
catering seems to be one of those areas that has
become a very intriguing thing that won It helps connect
the community, but it also drives a lot of store sales.
Right now, in terms of the mix, if you look
at sales of takeout livery catering is there. Can you
(21:02):
share any numbers on what those are versus in store dining?
Speaker 2 (21:06):
Yeah, Our off premise business is about fifty five percent
of sales, okay, which is a total change from pre COVID.
Pre COVID we were about six percent or sixty percent
dine in forty percent off premise. When you know, when
the pandemic happened, you immediately went to zero on premise.
(21:30):
And what's interesting is, you know we do it stack
bar charts on how much is coming from each segment
on those right, and you could see the off premise
jump and the off premise number never went down. What
happened is the in store business went up, right, And
so it was there was almost a sea change at
that point in time where people who may not have
(21:52):
done that before, all of a sudden realized, hey, this
is a great way to do this, and so it's
just kind of stayed to that on them.
Speaker 3 (22:01):
To do it one time than there is.
Speaker 1 (22:03):
Right, Well, it's changed the it has changed the mindset
of now the fast casual guest and consumer. They they
don't even look at at restaurants the same way anymore.
I you know, when we talk to a lot of
consumer groups when we go out and invest in brands,
the first thing we do is we'll go into a
(22:24):
local like if we're investing here in Miami, we'll go
into a local area and do you know kind of
a lunch thing where people can you know, we on
social media, it's mostly brand people that go to that
brand and we just ask them to come do a
lunch tell us about what they're seeing. So it's like
a consumer focus group. And we did want a couple
of weeks ago and I was surprised at the amount
(22:49):
of mindset shift that has occurred around how they order now.
It's it's so much different to your point, which I
guess supports your fifty five percent you know, right, you're
seeing on takeout well.
Speaker 2 (23:03):
And I think I think ultimately, if you go to
you know, historically, I go back to kind of when
I started this business, right, it's always been about quality, service,
value and convenience, right, And what's changing is how you
define convenience, right. I mean, if you look at QSR,
obviously what seventy to eighty percent of their business has
(23:23):
been through the drive through, So it's always been an
off this business, right, But if you look at casual
dining and fast casual, it's always been more of an
on premise business. But I think people have said, but
that's because they couldn't drive through with those places, right,
But now they've got alternative ways to access that business
in a convenient way, and so they're choosing to do that. Yeah.
(23:46):
I was looking at our sales in the first quarter,
and what I would call digital off premise was, you know,
was one of our areas of growth, right. So that's
including online ordering. You come to the store and pick
it up. That includes delivery if you're doing that, and
that includes curb side. Right. So those three things have
(24:08):
all grown. And what you see declining a little bit
is people used to come to come to the store,
order takeout and go, but they're basically saying, well, why
would I sit there and wait? I can I can
order online? And they used to the other one. They
used to call in. And we've seen, you know, consistently
over the past three years. Yeah, to call in business
(24:29):
drops twenty Yeah.
Speaker 3 (24:31):
Yeah, the gen zs are not calling everything.
Speaker 2 (24:36):
They're not They're not calling, right.
Speaker 4 (24:37):
I always joke that my fifteen year old or rather
starve than have to call a restaurant order.
Speaker 1 (24:42):
Yeah, well, it's like get them on a phone call.
You know, there's thing in a phone call. It's a Well, if.
Speaker 2 (24:48):
We've rolled out kiosks to stores, right, and I think
I went to the first store we rolled out of kiosk, Right,
I'm there watching to see what happens, right, And this
person goes up to the kiosk but there was no lot, right,
there was another cashier that was there ready to take
their order. And I said, well, she's over here, she
can help you. Goes, Oh, no, I'd rather do this
because it's it's the same thing as you see when
(25:10):
people want to test text versus talk on the phone.
Speaker 1 (25:14):
Yeah for sure.
Speaker 2 (25:15):
Yeah, you know, it's just a different different way.
Speaker 1 (25:17):
That it's a shift in minds.
Speaker 2 (25:19):
Yeahs to shift in mindset. So you know, we continue
to see that. So and then catering is about eleven
percent of that fifty, right.
Speaker 1 (25:29):
So that's impressive. Yeah, so these are really good numbers.
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you there. Now, with all of this growth off premise,
(27:14):
obviously this surely has changed the way that you build stores.
Speaker 2 (27:18):
Absolutely, So that's that's the next part of that, is that.
Speaker 1 (27:21):
What has changed.
Speaker 2 (27:22):
Yeah, Historically we said we wanted four thousand to forty
five hundred square feet because you needed to have the
seats especially, you know, it is one of these things,
right you need to have that seats from from eleven
to one if you will. Right after that you really
didn't need all those seats, right. But yeah, now, and
you know what's what's fortunate about that? I think that
(27:43):
helps with development because you know, building stores hasn't gotten
any less expensive. The real estate hasn't gotten any less expensive. Right,
So when you start talking about how do you improve
your store level economics, one of the things that we
can do is smaller stores. And we've we've been we've
(28:03):
built stores as small as thirty two hundred square feet now,
and really what that does is the kitchen kind of
remains the same size, although we're looking at ways to
get more efficient in the kitchen design. But what happens
is you just don't need one hundred and forty seats
anymore to service the dine in business.
Speaker 1 (28:21):
Yeah, I'm looking at just you know, on Google images.
You know you've got you know, this one in Miami.
It looks like it's somewhat of an end cap?
Speaker 2 (28:33):
Is that?
Speaker 1 (28:33):
Do you go for end caps mostly? Are you looking
for standalone.
Speaker 2 (28:37):
What, yeah, end cap is probably the easiest. I mean,
we do have some standalones we've got, but you know,
end cap, but we do have some indline locations. But like,
for example, the store I was talking about this thirty
two hundred square feet that opened a year and a
half ago, is an end cap in a in a
strip center. That one actually has a drive through on
(28:57):
it as well. And so okay, yeah, so but you know,
it's it's you know, it's interesting. Even when you put
a drive through on, you get maybe twenty to twenty
five percent of the business goes through the drive through,
and so it's it's never going to be you know,
the seventy percent that you see in the in the
(29:17):
quick service.
Speaker 1 (29:18):
So this one in Houston, sorry, share, I'm kind of curious.
I'm going to bring this up on screen because it's
it's an interesting location and I wanted to see what
you guys did here. So it's that picture right there.
Let me see if I can zoom in on it. Well, yeah,
there you go, it's the it's the my ad blocker
on but it was the one in reference to what's
(29:41):
going on in Houston? What is what is that one? Right,
there on the top right you can kind of see it. It
looks like it was a previous something.
Speaker 2 (29:49):
Yes, well, I'm not sure about this one specifically.
Speaker 1 (29:53):
I don't know which location, but is that a strategy
where you'll go into old restaurant units and refirm them.
Speaker 2 (30:00):
We call it second generation as opposed to old I
guess okay, uh. With the store we just opened in
Pascagoula was previously an eyehop that had closed and we
went in and converted it. Now. It was interesting because
it was much bigger than it was back to the
four thousand square fleet location. But based on the rent
and the fact that you know, there was a freezer
(30:24):
cooler there, there were already hoods there, There are already
restrooms there. They Yeah, actual construction cross was significantly less
than another store.
Speaker 1 (30:34):
So yeah, well these are looking good though. I mean,
you've got a really fresh brand approach. I think that's
that's going to be very you know, very attracting to
the consumer itself. Have you guys done anything recently around
brand redesign.
Speaker 2 (30:51):
We're actually in the process right now of We've got
engaged with a firm that we're looking at. You know,
how do we know what do we like, what do
we you know, what do we need to do to
continue to grow the brand? Right? So that look, the
look that view were shown there is kind of was
a redesign that was done probably like six years ago,
(31:12):
and so you know, we're we're continuing to look at that.
We're also in the process from a technology standpoint of
putting toast as a pos in our restaurants. We've got
a pilot in one of them, and the new store
that just opened opened with toast in it. And that
(31:33):
gets us a couple of things. One kitchen display creen
screens come with that. Historically NUKES has used a ticket
system and so that'll give us some things. The other
thing is is that it gives us a guest facing
screen where the guests can enter their loyalty numbers. So cool,
you know, loyal you know, so right now what they
come in the loyalty number is their phone number. They
(31:55):
have to give it to the cashier. The cashier has
to bring that in, but I always.
Speaker 1 (31:59):
Hate doing that.
Speaker 2 (32:00):
Yeah, so now now we'll have a screen, once we
roll this out, we'll have a where we can do that.
So that's goodness.
Speaker 1 (32:07):
We figured that out.
Speaker 4 (32:09):
We're are going to keep the kiosks in all the
in all new locations.
Speaker 3 (32:14):
Will they all have them?
Speaker 2 (32:15):
Yeah? I think so. Again, I think this is part
of you know, trying to meet the guests on how
they want to access the brand, right, Yeah, and so
you know, one of the one of the strange things
we're you know, we're still struggling with where to figure
out the best place. What's the most efficient place to
put the kiosk. What we've done in a lot of
the retrofits is we put it on the front counter.
(32:37):
But what we see as the guest, I think is
a little bit concerned about am I cutting the line
to go to the kiosk. So we've actually talked about
do we have like a kiosk line and a regular
you know, cashier line so that the person who says, well,
wait a minute, the cashier line is too long, let
me go over to the kiosk. Right, We think about
think about airports and some of those kind of things
(32:58):
where there's different lines for like back drop versus checking in. So, uh,
you know, we're still working on some of those things
to try to figure out how can we do that.
You know, it's an opportunity again, you know, it's it's
a way that the guests can have a better experience.
If the line's too long, they can do that, or
if they want to use the technology versus talking to
(33:19):
a person on those on that So that's a that's
an opportunity and it's also an opportunity during the rush
to you know, have your redeploy your employees to the
kitchen to be able to improve the speed of service
on the on the kitchen times.
Speaker 4 (33:35):
Are you guys seeing people spending more money on their
average check spins with with Kiosk.
Speaker 2 (33:39):
Because I've got yeah, we do see that. You know,
it's still a small percentage of the business, but yeah,
you know you have the opportunity to always up sale
on on that. So I mean, in general, one of
the things that we're saying is, you know, I've always
been a big believer that value for the money is
a great is a great way to talk about it, right,
(34:01):
because when people talk about value, they think they're talking
about low price. Right. We're never going to be the
low price guys out there, but our objective is to
try to figure out how do we give you value
for the money. So one of the things that we've
always had is you know, typically a lot of restaurants
have you know, half sandwich, cup of soup. Right, we've
always had a large sandwich, what we call a large pairing,
(34:24):
where we're gonna have a large sandwich, a pizza with
a caesar salad, all that bundling where you get an
opportunity to get a lot of food for a price. Right.
One of the things we're testing right now is actually
a pick three where you can pick a half sandwich,
cup of soup, salad, mac and cheese, bowl of fruit,
(34:49):
anything you want and pick three of those. And what
we've seen so far is a lot of people are
picking like a half nukes que and a half roast
beef sandwich and a cup of soup. So it's really fascinating.
We started looking at some of the numbers on this
is just something we've done here in the last month,
and it's like a third of the orders are having
(35:09):
two different sandwiches on it, right, So it's a variety. Yeah.
So yeah, you know, you talk about variety, you talk
about value, and you know that's you know, when we
looked at it, we said, wait a minute, we're doing
a full sandwich and a cup of soup. What's the
difference between doing two half sandwiches and a cup of soup? Right, So,
so it's the same price of our as our large pairing.
And so we have seen guests move from just ordering
(35:33):
a sandwich with a side to ordering in these pairings,
which you know drives the average check and the penny
profit per transaction.
Speaker 1 (35:42):
So expansion wise, I saw on the list you had Carolina's.
I also saw Oklahoma in there.
Speaker 2 (35:49):
Is that?
Speaker 1 (35:51):
What what are the states for strategy for you?
Speaker 2 (35:53):
Yeah, what we've looked at is, you know, I think
the great way to grow the brand is to grow
kind of from the core, right. So when you look
at we're in Arkansas, we're in Texas right, moving to Oklahoma,
because there are a lot of people in those states
who know the brand right. And when we see, as
I mentioned before in social media, when we get these
(36:14):
comments about when's the brand coming here, a lot of
those are places like the Carolina So at one point
in time, we did have we do have a store
in South Carolina. We don't have anything in North Carolina
right now. We did have a couple stores there, but
a franchisee had some health challenges and ended up having
to close those stores. That was kind of pre pandemic.
(36:34):
Plus we had some stores that closed as a result
of the pandemic. So we know that the brand works
in those markets, and so it's really kind of growing
from there. I think it's it's easier to do that
than to go to some place like Minnesota where very
few people know the brand. Right, So that's really what
we're looking for.
Speaker 1 (36:52):
Well, you're also getting into some pretty competitive areas because
I know Oklahoma has a lot of mcallisters. Go head
to head with those guys.
Speaker 2 (37:02):
Well, we love going ahead, I know, I know which
is good.
Speaker 1 (37:06):
We like competition. It only shows how good we are.
Speaker 2 (37:11):
That's right. Well, it's it's interesting because we do you know, well,
we talked about Pascagoula and Oxford, Mississippi. We do well
in those towns, but we actually do really well in
Atlanta as well, which is you know, is a very
competitive restaurant. Yes, we've got we've got some great stores
in Atlanta, in the perimeter area, in Canton, in Smyrna,
(37:33):
in you know places down South noon in so we
we we do really well in those places. So that
may that gives me the confidence that we can go
into some of these markets. We actually have a we
have a great franchise in the Baltimore that does really well.
So yeah, so I feel like the brand can expand there.
Speaker 1 (37:55):
I know Sherah has a ton of questions here.
Speaker 4 (37:57):
I was just thinking, well, you know, when's Kansas City coming.
That's hours.
Speaker 2 (38:04):
We're actually having a conversation right now with a potential
franchise in Wichita, So you.
Speaker 1 (38:08):
Know that's always from Kansas City.
Speaker 4 (38:12):
Ye hours, three hours, we're creeping up there. Yeah, like
you one, then it's a lot easier to start sprinklin
stretch sprinklined out.
Speaker 1 (38:23):
Right where you get into the into those markets I think,
which are very friendly to you know, to brands like yours,
you know, and and you know many people. I think
a lot of fast casual concepts, I know, Sharon and
I have been interviewing quite a few that are either
east coast, West coast, you know. And it seems like
most of the growth though, is happening in the interior,
(38:49):
whether you look at Midwest, the southwest, the southeast, UH
is really growing heavy right now in the fast casual sector.
Beyond that, as far as the future of the sector itself,
You've been you know, You've had a chance to work
with many brands in the sector, and you look at
this really kind of a quantum shift almost in the
consumer just in the last you know, five six years now.
(39:14):
Frank would you what would you say if you were
just entering the business today, How would you go about
it today? Because it's a it seems to me like
it's a completely different business today.
Speaker 2 (39:24):
Yeah, it certainly is. And I think you know, fortunately
for us, our menu works really well for the off
premise business. Right. So as I start thinking about now,
I've people talk about, you know, when are when are
French fries ever going to be good delivered? Right? I mean,
as you think about those kind of things, yeah, so
(39:45):
you yeah, to me, it's about you know, having a
having a menu. First of all, I think, you know,
people want to eat healthier, they want to have fresh items,
they want to I think they want to have stuff
that travels well. Uh, and I you want to have uh,
you know, I think a broad enough menu to you know,
(40:06):
cast the net wide enough, but not too complex operationally
so you can't execute it, right, I mean one of them.
I mean one of the challenges in the business is
getting getting the right employees right, And it's always been
an employee business, and you think about you know, I
used to think about this all the time. You know,
you've got for us, you know, some of our high
volume stores are four million dollars, right and basically being
(40:30):
run with you know people who some of them are
turning over a one hundred percent a year. Right, So
how do you right, how do you get the training
to be or how do you make the systems so
easy that you can deal with that and still deliver
a quality product? Right? So looking for ways to you know,
(40:50):
I've always looked at I've tended to look at products
and saying, okay, great, what's the what's the differentiation in
my product? And what's the operational complex city? Right? Because
I can you know, if I'm a five star restaurant,
I can do you know, great differentiation and great complexity.
But for us, it's how do I get a product
(41:10):
that's a differentiated product that is easy to do? I mean,
and I'll go back to the nukes Q rap as
an example. Right, It's easy to do a wrap and
all we're doing is we're putting our signature barbecue sauce
on that, right, and or make that our product. Right.
Speaker 4 (41:26):
So so you guys, you said you have almost one hundred,
So what's the goal are you hoping to you know,
double in size or at twenty five or what is
like the crystal ball?
Speaker 2 (41:36):
Well, you know you talked about mcousers. You know, I'm
familiar with that having worked there for four years. And
NUKES was also founded by the same family that founded mcousers, Right,
So I look at I look at them as a
proxy to say, you know, how many units they have
and in our footprint, I think they've got over four
hundred units, So there's no reason that we can't double
(41:57):
the size of the business. Interesting, Okay, the toughest part
for us is just getting the right franchise partners, right,
because you know, there's a lot of franchise businesses out there,
and there's a lot of hot concepts, and as you know,
there's a lot of hot concepts that come out and
do well for a while and then flame out, and
then you've got concept like ours that's been around for
(42:18):
twenty one years.
Speaker 4 (42:18):
Right, Are you guys partnering with any of those, you know,
the franchise growers, the concepts that help you find franchisees.
Speaker 3 (42:25):
Are you just kind of doing it on your own.
Speaker 2 (42:27):
Right now, we have been doing it on our own.
As you know, we got acquired by Capital Spring, which
has kind of partnered up with FSC, so we're like
sister companies, and so we're sharing some resources. So we're
sharing some construction resources, franchise sales, we're like upping our
(42:49):
franchise sales investment with people and advertising, and so continue
to look at But I think there's also a trying
to identify in the market. I mean, I go back
to my experience, some of the best franchises we had
were people who had other concepts, whether that be in
El Paso or in Milwaukee or whatever, who then want
(43:12):
to diversify themselves and are looking for other concepts to
diversify with. So I think there are people that we
can try to identify and directly approach to do that
because they know what the good real estate looks like
in that mark.
Speaker 1 (43:25):
Well, yeah, you're exactly right. You're in the south mid midwest, Southwest,
So but you look at the brands that are very
populated in there that might align but not be competitive,
would be the Sonic franchisee.
Speaker 2 (43:43):
Right, Well, it's interesting our newest one of our newest franchises,
who now already built two locations, was formerly a Popeyes
franchisee okay, all right, and so you know you had
multi unit Popeyes. He ended up selling that one to
get into the fast casual segment. I think the other
thing is is some of the operators of the casual
(44:05):
dining brands, whether that be Comblebee's or Fridays or whatever, right,
who want to diversify and get in the fast casual
I think we're a great fit for those folks because
there is still an element of the hospitality and a
little bit of more complexity in the operations than some
of the other concepts that are out there. But you
don't have to deal with alcohol and fryers. And you
(44:28):
know from a lifestyle, right, you're not open until one
in the morning, as you are in casual dining were
typically closed at nine o'clock at night, right, So yeah,
I think it's it's an opportunity for those kind of
franchisees to diversify with our brand.
Speaker 1 (44:41):
So, Frank, we're going to get you on the last question,
and that is to talk about kind of the vision
for the sector and if you you know, with your expertise,
your your ability to work with some of what I
think are some of the best brands in the business
right now, at least in the ask casual side. When
(45:01):
you look out over the next five years, what do
you think is set up for this sector? Because many
people have said there's too many brands, there's too much option,
we're going to see there's arguments around this. I talked
to Jim Baylis. We're a capitalist spring, just not too
long and he's talking about that very thing of maybe
we're going to see some consolidation. But what are your
(45:22):
thoughts on where this market can go?
Speaker 2 (45:25):
Yeah, I do think, you know, there's a lot of competition, right,
we have I mean a couple of things go on, right.
Trade areas change over time, right, so we have stores
that close because what may have been the hot trade
area at one point in time is no longer the
hot trade area, right. So I do think there's opportunities
like that. As we talked about their second generation opportunities,
(45:47):
I think they'll be kind of winners and losers. I think,
you know, it's interesting to watch across the different business sectors. Right.
You've seen bankruptcies in red Lobster and Buka and all
those folks right where those people go to eat, right,
And so I do think that Fast Casual has an
(46:10):
opportunity to continue to take market share, continue to get
you know, people who kind of grow out of the
QSR business and wants something better but don't necessarily want
to make the time commitment to go to casual dining,
right and so and you have people that you know,
(46:32):
the other part of this is looking at the economics
and how much does it cost to eat? And you know,
everybody talks about I mean what we've seen with the
inflation and the prices, and you know a lot of
the industry data talks about people eating more at home.
I don't know that that's a long term trend. I
think that's a reaction to what it is. And then
after a while you get used to the pricing and
(46:57):
you can do those you know, so you kind of
go back to that. So I do think Fast Casual
is actually pretty well prepared, and this in terms of
quality of food convenience. Right. So one of the things
that we've always lacked behind, say QSR is the convenience.
So continuing to look at whether it's delivery, take out,
(47:17):
curbside ways to be more convenient and give you really
value for the money. Right. Yeah. The kind of things
that we're doing is to say, hey, we don't want
to charge you a lot for a little. We want
to give you a good value. Because I've heard people say, well,
pick three, what happens that people decide they want to share.
I don't care if they want to share, as long
(47:38):
as they come back every day. Right, If you believe
that's a good deal for you, and you weren't coming
to us before because we weren't a good deal, that's
that's acceptable to me. Right, I'm making money off of that.
I don't need to get that because I mean that's
always been one of the concerns you hear from franchisees
when you start doing some of these deals. Oh yeah, right,
(48:01):
Oh what happens if they share it? Yeah? I care
they came into your restaurant. Be happy for God's sakes. Right.
Speaker 1 (48:07):
Well, And that's the thing I think a lot of
operators lose sense of, is you know, the lifetime value
of a guest is often overlooked and just how important
that is to really make it in this business. You know,
we see it all the time. We are definitely going
to be keeping an eye on you though. I think
nukes Is is kind of one of those up and
(48:28):
comers in terms of especially in the bakery bakery cafe
kind of concepts out there. So congrats on everything you
guys are doing over there.
Speaker 4 (48:37):
And nukes Is made the Fast Casual Top one hundred lists,
so we're out in a couple you know, in a
few weeks where they ranked, So that's always exciting.
Speaker 2 (48:46):
Also, that's very exciting for us though.
Speaker 1 (48:48):
I love it. Anyway, thanks for coming in on the
show today.
Speaker 2 (48:50):
All right, thanks for having me. This is this is great,
you know, I mean, I love talking about the industry.
Speaker 1 (48:55):
So you've got thanks for coming around.
Speaker 2 (48:57):
All right, appreciate it.
Speaker 1 (48:58):
All right, all right, so another great interview from you
know what I think are you know some of the
industry experts that are running these brands, you know, they
get a chance to really kind of dive deep on
this shows.
Speaker 3 (49:11):
OG for sure a fast O G.
Speaker 1 (49:14):
What do you think about bakery cafe right now in
terms of if you look at the categories, how does
it rank?
Speaker 3 (49:20):
I think it's it's coming up people.
Speaker 4 (49:22):
To Frank's point earlier, people are wanting more fresh options.
So I think it's hot right now, and I think
we're going to we're going to see some more exciting stuff,
especially from Nukes and some other brands like them.
Speaker 1 (49:33):
Well, it was it kind of fell out of favor
for a little bit. You know. I think we saw
fresh mechs rose, then we saw the chicken. You know,
chains really get at chicken. And yeah, pizza of course
had its light. You know, everybody's had there. But it
seems like it's cycling back through where maybe there's some
new brand discovery from this new generation.
Speaker 2 (49:53):
You know.
Speaker 4 (49:54):
Yeah. Well and like just like what Frank said about,
you know, going with the wraps, so I mean that
it's a smart move. It's the same ingredients and just
wanting to wrap an easy way to add something new
to the menu without a bunch of extra hues. So
I thought that was very smart.
Speaker 1 (50:09):
Speaking of shaping the future of Fast Casual, you guys
should make sure that you attend this event this year,
and that of course is going to be the Fast
Casual Executive Summit in Austin, Texas this year. Shera, can
you share any good news about what's going to happen here?
Speaker 3 (50:28):
We have a ton of great news. You can see that.
Speaker 4 (50:31):
We have our keynote set, which is going to be
a really cool story of Chef.
Speaker 3 (50:36):
Bryant and Danielle Williams. They're a power couple. They have
a really interesting story where they.
Speaker 4 (50:40):
Came from kind of homelessness to up and coming. So
they've got a couple of restaurants. Yeah, it's really cool.
And so you know, we have a lot of our
saying people that we get to speak about, you know, people.
Speaker 3 (50:53):
Like Kelly Roddy and Susan Taylor.
Speaker 4 (50:56):
But we have a lot of newer people too that
haven't been on the age and yet we're really trying
to make sure we have some new faces and some
new brands so everybody gets a chance to learn from everybody.
Speaker 1 (51:07):
What is this book a room venue?
Speaker 2 (51:10):
Oh?
Speaker 4 (51:11):
Yeah, is going to be it's at click it It's
at the Marriott.
Speaker 1 (51:18):
Okay, so yeah, okay, Oh this is a good hotel.
Speaker 4 (51:22):
Yeah, it's gorgeous. And then we will have the catering
summit right after that. We'll close up on the fast
Casual smit on the seventh and roll right into the
catering opening reception and keynote.
Speaker 3 (51:34):
So it'll be good. You can come for all everything
or just one so.
Speaker 4 (51:38):
Top are hopefully Yeah, you know there's the right.
Speaker 1 (51:43):
What a beautiful skyline that is. Listen, you guys got
to be.
Speaker 2 (51:48):
There for sure.
Speaker 1 (51:50):
Yeah, I love it. It's going to be there. I'll
be there. We're going to be filming this podcast. There
a lot of cool be covering. We're gonna have so
much fun. Perfect Pitch is going to be unbelievable this year.
Speaker 3 (52:05):
Crazy. Yeah, this is going to be.
Speaker 1 (52:07):
The go to event. I think.
Speaker 3 (52:09):
I think so too, And I'm so excited about the
Perfect Pitch.
Speaker 4 (52:12):
Usually when only have it, like the one hour, but
we're having so we'll have three or four brands go
the first day and then we'll pick a winner. Then
we'll have three or four brands go the second day,
and then the attendees will pick a winner. And then
the final day those two will go ahead to head
and then the audience vote.
Speaker 3 (52:27):
Maybe we'll vote for the ultimate who will.
Speaker 1 (52:29):
Be a So this is going to be so much
fun anyway, all right, guys, we're going to catch you
next week right here on Fast Casual Nation. Make sure
and subscribe to the show. If you're watching this on
YouTube right now. It a like and of course, give
us a comment. We always love to gift those if
you are listening to the audio podcasts, because I know
some of you guys are driving or working and you're
over on Spotify, you're over on Apple. When you get
(52:50):
a chance, take a little moment and just give us
a star or give us a little recommendation on any
of those podcast apps out there. We're also available over
on iHeart Radios for some of you listeners. By the way,
iheartradiou started moving up the charts on our audio podcast.
I don't know why, so watch out for the iHeart guys.
(53:13):
We'll see what's going on. Good seeing you share. We'll
catch you next
Speaker 4 (53:17):
Week, see you next week, all right, by bye,
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