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jCarbonara
Joe Carbonara

Labor Lessons

Real growth continues to be hard to come by for the foodservice industry. In fact, overall customer traffic was flat through the first quarter of 2016, according to The NPD Group, a market research firm covering the foodservice industry. Revenues and customer traffic may be inching along, but one area growing at breakneck speed is labor costs.

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jMartinez
Juan Martinez

Post NRA Thoughts: My Labor Costs are Killing Me! What Can I do About It?

The National Restaurant Association’s annual trade show has come and gone to much fanfare. From what I saw and read, the participation was phenomenal. We were able to bring our full consulting team from all of our offices and even made time to break some bread together.  This year, I also participated in a panel discussion that explored unit economics  and was moderated by Steve Romaniello, managing director of Roark Capital.

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jStiegler
Jerry Stiegler

Study Projects Compound Growth Rate for U.S. Foodservice Market

Restaurant sales in June were slower than in May. A new report looks for foodservice to grow 3.33 percent in the next 5 years. A C-store chain says it will open at least 600 locations in the next few years. Taco Bell expands their Cantina concept. These stories and a whole lot more This Week In Foodservice.

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Highlights

Chain Innovators: Tilted Kilt

A good idea should not go to waste; instead it should be franchised. This was the impetus behind the growth of Tempe, Ariz.-based Tilted Kilt, which has grown from one location to 53 in the six years since Ron Lynch joined the company as operating franchise president.

Tilted KiltA former area developer for Schlotzky's Deli, Lynch visited Mark DiMartino's single Tilted Kilt location at Las Vegas' Rio Casino in 2005 and knew he wanted to own the concept. The men decided to form a partnership, with the goal to franchise and expand the brand. Tilted Kilt now has locations in 18 states, with a heavy concentration in Illinois, Georgia, Florida and Texas, and anticipates a total of 75 sites by year end.

The concept has been compared to a Celtic Hooters', with female servers dressed in short kilts and revealing crop tops. Customer service is the hallmark of these sports pubs. "I've been in the QSR segment, and so many operators take the human touch out of it," Lynch says. "We're going the opposite direction."

Both Lynch and DiMartino are food guys, so it was important for Tilted Kilt to blend its entertainment value with good food. Although its biggest seller is the 10-oz. cheeseburger, the chain has concentrated on healthier fare, including grilled chicken wings, salmon and turkey burgers.

"Healthier items are unusual for a sports pub, but we're finding that even young males are more health conscious," Lynch says.

There's still no mistaking that sports take center stage. With between 30 and 45 big-screen televisions in each location, customers can watch three or four different sporting events at one time.

With 12 Tilted Kilt locations under construction at press time and another dozen in the permit stage, this chain is destined to take customer service to a whole new level.

Fast Facts

  • Year founded: 2005
  • Headquarters: Tempe, Ariz.
  • Menu specialties: American comfort food with pub specialties
  • Service model: Casual sports pub
  • Units: 53
  • 2010 sales: $80 million
  • 2010 growth: 100 percent growth in revenue over 2009, 75 percent growth in units
  • Projected 2011 growth: 100 percent growth in revenue over 2010, 50 percent growth in units
  • Key expansion markets: Illinois, Florida, Southern California, Texas
  • Typical location: Freestanding building
  • Average unit size: 7,000–8,000 sq. ft.
  • Average kitchen space: 1,800 sq. ft.
  • Average covers per day: 580
  • Average check: $23.00
  • Total equipment investment per unit: $300,000
  • Total unit cost: $700,000 to $2.4 million

Key Players

  • Director of Pub Development: Richard Berns
  • Director of Supply Chain: Steve McNearney
  • Smallwares & Equipment Dealers: The Wasserstrom Company, TriMark South, TriMark Marlin
  • Food Distributors: Distribution Marketing Advantage (Reinhart, Gordon Foods, Shamrock, Ben E. Keith)
  • Architect: Big Red Rooster
  • Design: Big Red Rooster
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