Beef 'O' Brady's Slices Open New Revenue Streams
Chris Elliott wasted little time in analyzing the market when he stepped in as CEO of Beef 'O' Brady's in March of 2010.
He visited multiple locations, ate the food, surveyed the market, and came to a swift conclusion: Pizza would be a natural fit for the brand. A look at competitors, who Elliott says include Applebee's, Chili's, and Buffalo Wild Wings, indicated it'd be acceptable, though the CEO still wanted to gain guest input.
A customer focus group was set up, but feedback wasn't positive. "Their initial reaction was: Nah, when we think of Beef 'O' Brady's, we don't think of pizza," Elliott recalls. Digging deeper, executives found that customers would be willing to eat pizza at the sports pub brand—but only if it was a high-quality program.
Earlier this month, Beef ‘O’ Brady's rolled out pizza and flatbreads on its national menu, after nearly three years of polling focus groups, searching for the appropriate ingredients, testing the product, and overcoming operational issues like kitchens that weren't built for pizza making. Positive encouragement is flowing in not just from customers, but franchisees, as well.
In the meantime, Beef ‘O’ Brady’s is gearing up for its 30th anniversary next year and developing a fast-casual prototype to debut in about a year. The sweeping changes date back to when Elliott and the new management team took over in 2010.
“We’d like to expand and to do that, improving your store-level economics is fundamental, and we’re on our fourth year of positive [comparable store sales],” he says. “Our average unit volumes have grown $169,000 over the last four years, and our margins have improved significantly. All of that makes for a more attractive financial investment, and that is what is fueling our growth.”
Despite a skeptical initial response from consumers in the early focus group, Beef ‘O’ Brady’s customers ultimately fed executives a more hopeful ultimatum about pizza. "The focus group said, 'If you're going to do pizza, that's great, but it's got to be as good as anything else out there or don't bother,’” Elliott says.
The hunt began to find the most premium ingredients available. Beef 'O' Brady's sources whole milk Mozzarella and the highest-quality pizza sauce available in the country, Elliott says. The dough proved tricky: Big dough balls were problematic, and it took several iterations of working with manufacturers and equipment makers to conceive a program that would work in the restaurant's kitchens. In the end, Beef's developed its own dough recipe.
Testing was gradual: Beef ‘O’ Brady’s would roll pizza out to a handful of stores, test its feasibility with the given kitchen procedures and equipment, and then refine the recipe or operations and repeat the process. Most stores that added pizza during the testing stage did so voluntarily, excited to take part in the trial, Elliott says.
During this time, as another positive sign, executives learned that Beef’s customers were open to new creations at the brand. The restaurant had added fajitas to its menu in spring of 2012, and they quickly became one of the most profitable items on the menu.
The pizza and flatbread, which rolled out nationally Aug. 4, have received strong support from consumers as well as franchisees, who report that the product has exceeded expectations. Priced at $5.99 for a personal, 7-inch pizza and $9.99 for a large, 14-inch pie, the offerings are competitive in the marketplace.
Eight pizza varieties decorate the menu, as well as a build-your-own option and three flatbreads. Selections are as expansive as the Chipotle Philly flatbread and Beef’s Buffalo Chicken pizza. For Beef 'O' Brady's two fall promotions, the pizza will be front and center, dominating the direct mail drops, Facebook page, website, TV, and radio ads.
The Big 3-0
Next year, the brand's 30th anniversary will be the focal point of its marketing, and the theme, Elliott says, is new beginnings. "A lot of wisdom comes from being a system that's 30 years old," he explains, "but in this competitive environment, you have to keep the mindset that you constantly have to reinvent yourself to stay interesting."
Part of that reinvention will arrive in the form of a fast-casual prototype that will offer a scaled-down version of Beef 'O' Brady's menu, easy to operate in a quick-service setting. Consumers will come in and order at a counter, and servers will deliver food to their table when it is ready. The building and menu are under design, and Elliott says the company hopes to have a prototype open by mid-2015.
It's a natural extension of a brand that is maintaining strong growth in revenues and AUV. With the new menu developments, higher margins, and expansion plans, Elliott suggests the brand has only begun to spread its wings.
"There were skepticisms about our ability to do a high-quality pizza product, and that's why it took a couple years to get from zero to where we are, because the focus was on quality and operations," he says. "But I think when customers realize how good it is— when they realize they can get a pizza or flatbread at Beef's that's as good as what they can get at specialty pizza restaurant—absolutely I think it will change peoples' perception about Beef 'O' Brady's and what we're capable of."
By Sonya Chudgar