Diving for Dollars

The great thing about the restaurant industry is that the operators and concept creators don’t wait for times to get better to get their business back. They follow the customer.  If you have an existing concept you are limited in the short term with how you can react to the demands for more value for the money spent. You can put forth some value offerings, some limited time offers, some couponing, some day/time specific deals, and the like, but there is nothing like a new concept targeted for the current economy that makes the register ring. Dallas has had two such concepts opened by noted restaurateurs within the past 30 days that dive into prices much lower than their other concepts.

For watching trends there is nothing more revealing than to watch what a new concept opens with in food and look. Existing restaurants and chains have to evolve with new trends and designs, they don’t have the luxury of just starting over every 3-5 years. The older they are, or the more units they have in the chain, the more difficult it is to change and bring your current customers along with you. Customers like incremental, not radical change. Ironically, they love new concepts.

The trends in casual dining that are raging across the country are affordable prices, within the context of the concept, comfort foods, and a "feel good" atmosphere to forget about the world outside for an hour or two. Comfort foods are really picking up speed. Now that Jack has left his hospital bed and returned to his corner office at Jack in the Box, I expect to see his first order of business to be to instruct the R & D staff to start working on braised short ribs. Everyone else has it, QSR can’t be too far behind.

In Dallas, Chef Kent Rathbun has opened a new concept called Rathbun’s Blue Plate Kitchen. Maybe you saw Kent and his chef brother Kevin outgun Bobby Flay on Iron Chef? Kent has two other concepts: Abacus ($100/person) and Jasper’s ($50/person). Capitalizing on the trends that he and his chef buddies talk about constantly, Kent has opened a $30/person restaurant (restraint for a five-star chef) that wants to be "the Mecca of affordable, casual cuisine in the Dallas area".

How does this translate into a menu?

USDA Prime Meatloaf, Niman Ranch Beef Rib Pot Roast, Fried Chicken with black pepper-maple gravy, Gouda Macaroni and Cheese, Heirloom Corn-Chipotle Spoonbread, and Dr. Pepper Mopped Rotisserie Chicken are a few of the comfort foods done five-star chef-style. Dinner entrees are mostly in the $12-$22 price range. Kent opened to a crowd the first day and hasn’t slowed down yet.

Phil Romano and his partner Joe Palladino have opened a casual offshoot of their Nick & Sam’s Steakhouse, a $70/person prime steakhouse. The new concept, Nick & Sam’s Grill, features traditional American comfort food served in an energetic bistro atmosphere. Remember the trends? Comfort food (√) and "feel good" atmosphere (√). Got those two boxes checked off. How about affordable? Not counting three cuts of New York Strip, entrees range $7-$12. Give that box another √.

Berkshire Pork Chop ($12), Baby Back Ribs ($12), Homestyle Meatloaf ($10), and "Grown Up" Grilled Cheese with tomato basil soup and fries ($9), Creamed Corn and Macaroni & Cheese are among the comfort foods offered. Additionally, the menu is heavy in seafood, salads, and sandwiches. Each with a chef’s touch.

What is the formula for success in this concept?

3,000 sq. ft. plus some patio seating + Sleek atmosphere and club music + Five-star chef overseeing the kitchen + Low prices + Nationally known owner = $100,000 in sales last week.

It is fun to watch a concept hit all of the current trends and be rewarded for its efforts. These are just two examples in one city in one state. Almost every city has a restaurateur reading the tea leaves for what the public is searching for. Kent and Phil are fortunate to either get, or not need, funding to open something new. When the credit markets open up a little bit I think we will see a flood of new concepts that address the demand for "feed me good food affordably, and make me forget about the outside world for an hour or so". That’s a positioning statement that you can really dive into.