Toque of the Town: Eggs in One Basket

First Watch’s daytime-only focus heightens the creative-menu challenge for Kevin Hall.

By Monica Rogers, Contributing Editor -- Chain Leader, 6/1/2004

Kevin Hall, Director of Operations and Menu-Development Chief, First Watch Restaurants

Most late afternoons, with the Florida sun beaming and the palm fronds and bougainvillea doing their fringe and fire dance on every landscaped street corner, Kevin Hall is on his way to the soccer fields. Yes, he’s director of operations and menu-development chief for a 50-unit restaurant chain. No, he’s not a slacker. But the company he works for—Sarasota, Fla.-based First Watch—was founded on the principle of “freedom after four.”

In an industry known for long, late hours, co-founder, President and CEO Ken Pendery wanted a better way. “One shift of workers serving best-quality breakfast and lunch,” he says. “Then you go home to tend the family and lead a relatively normal life. This way, I can still get in 18 holes of golf after four.”

Working Formula
Thus far, the formula has been working. Started in California in 1983, First Watch is growing at a healthy clip. Six new units in 2004 equaled a 20 percent growth rate for the company. Average unit volumes are slightly more than $1 million with checks averaging $6.75.

And the employee retention rate is way above the norm: less than 50 percent turnover for all management and hourly workers. It was happy First Watch hourlies who first brought the chain to Hall’s attention. “I was managing a dinner house in Naples, Fla., where we were losing employees as fast as we could hire them,” he says. “One day I heard some guests”—young First Watch employees—“bragging about this great place they worked, and they were selling eggs!” So he went to First Watch and applied for a job.

Hall worked as a First Watch manager for 12 years before the company’s growth called for a better menu-development process. “Our menu development had always been a companywide, by-committee sort of effort. But as we grew, the committee got to be just too large,” he explains. “We needed to streamline kitchen operations and menu-development procedures, so I raised my hand and said I’d do it.”

Hall, who graduated from the Culinary Institute of America and headed kitchens in New York independent restaurants before coming to Florida, says it feels great to be back in “creative menu mode.” In the two years since taking over First Watch’s menu development, he’s had plenty of challenges on his plate—a lot of them in thin, white shells.

E+M+C Equation

Just how many ways can you cook an egg? “Lots and lots,” Hall laughs. Eggs figure prominently in six of First Watch’s nine main menu categories, divided among breakfast, brunch and lunch. They’re used in scratch-made batters for French toast, pancakes and waffles; featured in scrambles, frittatas, crepes, wraps and roll-ups; and form the base of omelets and egg platters.

The Not Guilty Your Honor sandwich (foreground) is a new vegetarian option. The flatbread sandwich is filled with hummus, cucumbers, spinach, mushrooms, red peppers, tomatoes and feta cheese. The Power Wrap, egg whites, turkey, cheese, spinach and mushrooms in a sun-dried-tomato-basil wrap, is grabbing 10 percent of category sales.

Still, Hall says, “We’re always saying to each other around here, ‘It’s got to be more than eggs, meat and cheese.’”

One way Hall’s been adding interest to the e-m-c equation: testing healthful ingredients like soy milk, turkey bacon and chicken-apple sausage.

And in October the company added another dish to its 10-item Healthier Side brunch section. The Power Wrap includes egg whites whipped and sauteed, combined with smoked turkey, shredded Swiss cheese, baby spinach and mushrooms, and wrapped in a warm sun-dried tomato and basil tortilla, $5.95. It has jumped to 10 percent of sales in its category.

More Veggies Please
The demand for vegetarian options is also growing. First Watch’s Not Guilty Your Honor sandwich, grilled flatbread filled with hummus, cucumber, baby spinach, mushrooms, roasted red peppers, tomato slices and feta cheese with a side of potatoes, fresh fruit and marinated salad, $5.95, represents the company’s first addition of hummus to the menu. Introduced in April, the sandwich already makes up 6.3 percent of sandwich sales. “I was excited about that one,” Hall smiles, mentioning his Mediterranean heritage. “We’ll be looking for more ways to use hummus on the menu.”

The fresh, healthful approach is a good match for the breezy, clean, contemporary look of First Watch units, all deliberately planted in affluent areas. The stores are open and airy with lots of windows, light woods, live plants and khaki-clad servers with pastel-hued Hawaiian shirts.

“Fresh and healthy is just one more reason to go to First Watch,” says Sarasota-based restaurant analyst Rich Unger. “The carbo crisis sent people over there for their omelets. Next month it will be something else. Whatever comes up, First Watch has it down pat. They’ve carved a niche in the breakfast and lunch market that nobody else matches.”

Making Specials Special
Beyond healthful additions to the core menu, which changes every nine months, Hall and menu-development team partner Mike Sullivan spent the last year developing a 65-recipe specials index to give restaurants a fresh focus each week. Thirty-five to 40 specials are breakfast.

“We’ve always had specials,” Hall explains. “But they were pretty much left up to the manager. Over time this meant specials became not so special—sort of an afterthought.” He created a folder on the company’s home-office server that he fills with recipes, photos and instructions for three specials per week. “This way, the managers just access the folder, and it’s all there,” Hall explains.

New wall-hung chalkboards, prominently displayed near restaurant entrances, highlight the specials. Recent items have included a shrimp quesadilla, $6.95; a Philly cheese steak sandwich, $6.50; and an artichoke and spinach omelet, $5.95.

Since enhancing its specials program in October, First Watch has seen lunch specials almost double to 3 percent of the sales mix and breakfast specials quadruple to 4 percent.

Inspirational Fooling
Ideas for both specials and core menu items come to Hall several different ways. “Some are my own inspiration,” he says, “just fooling around in the kitchen.” One example of this is the Chickichanga, First Watch’s take on a chimichanga. Whipped eggs with spicy chicken, housemade chorizo, green chiles, onion and avocado are rolled in a flour tortilla, sauteed until crisp, topped with Veracruz sauce and sour cream, and served with potatoes for $6.50. “It just came to me through trial and error,” says Hall. “We don’t have deep-fat fryers in our restaurants, but I kept thinking that if we crisped the exterior of a tortilla another way, the flavor and texture would be just as good.”

Other new items come from unit managers and cooks. For example: the Chicken Fajita Crepe with chicken, green bell peppers, roasted red peppers, onions, cheddar and Jack cheeses, Veracruz sauce, sour cream and chives, $6.25. “We have several managers who really have a passion for food and like to create new items as specials,” Hall explains. “If it’s a good seller and is operationally feasible, we tag it as a prospective menu item and memo units to run it as a special and give us feedback.”

Lunch Time
Moving forward, Hall wants to expand lunch options including the Daily Deli Double, a popular value-priced $5.95 special that features choice of a half sandwich, soup, First Watch’s signature poppy-seed-vinaigrette-marinated vegetable salad and fresh fruit. “We’ve only got about five options for the [Daily Deli Double] right now,” Hall says. “I’d like to increase that to an index of 20 options for managers to choose from.”

The Chickichanga, First Watch’s version of a chimichanga, combines eggs with spicy chicken, chorizo, green chiles, onion and avocado rolled in a flour tortilla, sauteed until crisp, and topped with Veracruz sauce and sour cream.

This year First Watch is putting more emphasis on lunch. While on weekends breakfast dominates, on weekdays lunch generates 60 percent of sales.

“We just added an extra ounce of meat to our sandwich offerings; are retooling some sandwich mainstays, such as our chicken-teriyaki sandwich; and are working to develop some completely new items. Maybe pastrami,” Hall concludes.

The company went systemwide with a reformulated soup program in February (tested in Orlando, Fla., stores in October). “You might be surprised about this, but soup is very important to a daytime concept. If you do it right, people remember you for it,” says Hall. New soup varieties include vegetable, bean and corn chowder. The soup menu changes daily.

First Watch is also building its to-go business. “Takeout is at 4 percent of sales right now, and we would like to see that increase to 8 percent to 10 percent of sales,” says Hall. Enhancing this option, the company just built a new store prototype in Covington, Ky., with a cafe kiosk section serving cappuccino and espresso drinks and to-go items. “Depending on the results, we may move forward with this,” Hall says.

Since enhancing its specials program with items such as an artichoke and spinach omelet, First Watch has seen breakfast specials sales double and lunch specials quadruple.

The Daily Deli Double is a value-priced combo meal in which customers choose a half sandwich and soup plus First Watch’s signature poppy-seed-vinaigrette-marinated salad.