Chain Innovators: Moe’s Southwest Grill

Published on Friday, July 01, 2011

Written by Dana Tanyeri and Lisa White

Despite a tough year in terms of both real estate and franchisee financing, Moe's ended 2010 with revenues up 8 percent, 30 new units opened and comp-store sales ahead by 5.4 percent. Significantly bigger gains in both sales and units are expected this year, says president Paul Damico, thanks to a combination of menu innovation, ongoing promotions and a major new positioning campaign.

Moe's added one of its most successful limited time offers ever — rice bowls — to its permanent menu last year and brought back its popular buffalo chicken quesadilla/taco/salad LTO, both of which helped drive comp-store sales, which Damico estimates will jump again by 6 percent this year.

But the big news is its positioning campaign, which touts Moe's mission to serve the highest quality, natural ingredients. Redesigned menu boards feature a new food mission wheel that "steers" guests to healthy choices. Those include more than 20 gluten-free ingredients; vegetarian choices, including cheese and sour cream that are free of gelatin and animal rennet, as well as grilled items prepared on separate equipment from meats; and low-calorie options, including meals that weigh in at less than 450 calories.

The wheel also appears on Moe's website and social media sites and as wall art in the restaurants. Highlights from it are reiterated at different touch points throughout the dining experience — even on the napkins. "Healthy has long been a Moe's cornerstone, but we never were prepared to talk about it globally because not all of our ingredients were at the standard we now have 100 percent of the time in 100 percent of the restaurants," Damico says. "They are now, so we're shouting it from the rooftops."

Fast Facts

• Year founded: 2000
• Headquarters: Atlanta
• Menu specialties: Fresh, made-to-order southwestern fare
• Service model: Fast-casual
• Ownership: FOCUS Brands
• Units: 429 (4 company owned) domestic and international
• 2010 sales: $347 million
• 2010 growth: Revenue grew by 8 percent and the number of units increased by 3 percent
• Projected 2011 growth: 13.4 increase in revenue and units are expected to increase by 12.7 percent
• Key expansion markets: Minnesota, Indiana, Iowa, Wisconsin, Illinois
• Typical location: High visibility, strong anchor centers; end cap preferred
• Average unit size: 2,200–2,800 sq. ft.
• Average kitchen space: 40 percent of total square footage
• Average covers per day: 300
• Average check: $9.75
• Total unit cost: $450,000–$769,000
• Total equipment investment per unit: $81,000–$92,000

Key Players

• President: Paul Damico
• Vice President of Marketing: Joel Bulger
• Vice President of Operations: Scott Shotter
• Vice President of Restaurant Development: Steve Parker
• Sr. Director of Supply Chain: Kevin Vandiver
• Design: Lauren Taliaferro, restaurant design managers (FOCUS Brands)