In June, Danny York, CEO of Santa Fe Holdings Co., the parent company of Santa Fe Cattle Co., told investors, “We believe we're one of the most profitable steakhouse chains in our sector. We're generating profit by building top-line sales, which is bottom-line.”

The company's new store design, York told investors, is “extremely efficient at 5,947-square-feet and seating 187 patrons, a size that is optimal for return on investment. The new design delivers one of the highest sales-to-square-foot ratios in the casual-dining segment.

“Santa Fe Cattle Co.'s new stores are breaking company records for weekly sales long after the grand openings,” he added. “After the first four months, sales at the newly designed stores are leveling off at 30 percent higher than the company's older stores. The Ardmore, Okla., store continues to shatter previous records with the fourth consecutive week at more than $100,000 in sales, a level that is unheard of for a restaurant of that size.”

In addition to new store design, the poor economy also contributes to the chain's performance, York said. “While many people are giving up their vacations and other extras, they are not giving up their one luxury of eating out. The higher gas prices are actually favoring our restaurant concept by keeping customers in town.”

The chain has increased prices on a very small number of items and those increases are less than 5 percent. This is possible by consolidating national account contracts with major vendors to secure lower pricing and by introducing new menu items with high profit margins, York said. For example, 99-cent mini desserts at lunch and in-store promotions for frozen alcohol drinks continue to drive up check averages. Portion sizes aren't being cut to compensate for rising food costs.

In response to rising steel and energy costs, new store designs are modified to include wooden trusses rather than steel. In addition, modifications are made to the electrical switch gear layout that will allow 300 extra square feet of work space and save more than $1.8 million in the next 24 months, according to Mike Huff, Santa Fe Cattle Co.'s vice president of development. “C-stores use these,” Huff says. “In the McComb, Miss., store, for example, we've placed this in the dishroom hallway, which increased our amount of secured storage space and office space.”

Newer stores also have larger to-go areas with separate entrances to the restaurant. Restrooms were moved to the back.

Huff wears many hats in the company, including sourcing artifacts for the interior décor. Each unit is unique, providing a showcase for painted signs, metal art and what Huff calls a “hodgepodge” of other objects that he finds during his travels throughout the country. Murals depicting local scenes and funny sayings like “Vegetarian, another word for lousy hunter” also find their way onto distressed brick walls, and wood walls and accents. A 24-foot ceiling fan, which carries the manufacturer's logo, a donkey, is visible the moment customers enter. “We want guests to be light-hearted,” Huff says. “We also select staff members who enjoy this style of service. As a result, we have a 60-percent turnover, which is a much lower turnover than the industry average at 100 percent or more.” Week-long employee training sessions for new hires and the presence of an opening team at each new unit for four weeks also contribute to lower-than-average turnover rates.

“In order to position ourselves in the mid-price range for steakhouses, we pay close attention to every detail of the operation,” Huff says.

A walk-in cooler and small freezer occupies about 1,000-square-feet and sits outside the restaurant. It connects to the kitchen by doorways. A roof-cap membrane seals it to the restaurant building. “The cooler isn't considered part of the square footage, which saves a lot of money. Produce deliveries arrive daily and bulk items weekly. One of the largest shipments is beef, which comes in several times a week and is cut into portions at the store. Portioned poultry also comes in several times a week.”

Keeping tight controls on how meat is cut and aged is crucial to the company's quality control procedures. Two food distributors receive meat for the company and they go on to age and portion the proteins at their locations before sending them to the Santa Fe stores. “We age the meat for a minimum of 21 days,” Huff says. “We control the quality from the moment it is delivered to these locations. Staff at the stores can then prepare it properly.”

The kitchen comprises approximately 2,500-square-feet of the total 5,900-square-foot footprint. The prep area includes worktables, sinks, cutting equipment, a slicer, lettuce chopper and tomato dicers. Hot equipment includes two 25-gallon steam kettles for soups, chili, gravies and sauces. One convection oven bakes dough and cornbread, while the other heats baked and sweet potatoes, rice and chicken.

“We may replace the convection ovens and steam kettles with combi ovens,” Huff says. Adjacent to the ovens, one hot unit cooks barbecue ribs overnight and another holds items until needed for service.

Staff use the four-foot, four-burner range to heat pasta and side dishes and cook fajitas. Staff also take advantage of a five-foot char grill to sizzle steaks and chicken. Protein items comprise nearly 70 percent of the entrée items. They use a flat top for grilling onions, peppers and quesadillas and carmelizing sandwich buns.

Three fryers produce chicken tenders, beer-battered french fries, coconut shrimp, Texas toothpicks with jalapeno peppers and onions, and catfish.

The fryers and flat top comprise one station that two employees can man. The grill station is a separate section. They pass cooked items to an expediter, who garnishes and inspects plates before they go to customers.

A salad station contains a cold rail and wall-mount salad crisper to keep lettuce cold. Chilled plates sit beneath the salad prep tables. The cook manning the salad prep area also assembles desserts. An adjacent refrigerated unit holds salads and desserts. An ice cream freezer sits nearby.

For cleanup, staff have access to an automatic conveyor dishwasher and three-compartment pot wash sink. Pre-rinse drainers take the place of disposers.

Huff attributes much of the chain's successful operations to a long-standing relationship with the equipment dealer, Mobile Fixture, and sales representative Dorothy Mushenski. “Early on in our history, Dorothy helped us make changes in certain pieces of equipment that never worked properly. Now, she not only alerts us to new equipment and arranges for customized fabrication when needed, but she also helps us track every piece of equipment to monitor maintenance and repair in each store and handles problems when they occur.”

Huff says he looks for equipment that has longevity and is made by manufacturers who are willing to stand behind the equipment and do whatever is needed to get it working properly.

Another facet of efficiency and control is realized by managers being very involved in the cookline. “We believe in minimizing the amount of time managers spend on paperwork, so they can be involved in food preparation and with customers,” Huff says. “Each store's managers are involved in the cookline and at least one is opening and closing the store seven days a week.”

Controls are also implemented over energy costs through the use of energy-efficient lighting and programmable thermostats that adjust room temperatures during non-operating hours. In addition, staff turn on equipment in the morning only when needed. Huff says he is investigating upgrading fryers that also will save energy.

As Santa Fe Cattle Co. continues its ambitious expansion, the top executives are committed to maintaining their position in the mid-scale price range category. Keeping their attention on details and making sure the equipment is working at peak performance will be crucial to their success.