If anyone doubts the restaurant industry is maturing, they need only look to the number of well-known operators putting more than one hand in the industry pot, reaching beyond their current bread-and-butter to extracurricular ventures. Announcements of diversification have picked up fast and furiously of late, be it a new product, new prototype or new concept entirely. Here’s a cheat sheet of who’s looking to try what.
1. Danny Meyer sips the bar business.
Most of Meyer’s Union Square Hospitality Group restaurants feature a bar, but Porchlight, opened in New York City in March, is his first standalone watering hole. When you’ve racked up a string of financial wins like Gramercy Tavern and Shake Shack, people tend to notice a new undertaking. Meyer has flirted with the bar business through Jazz Standard, downstairs from his Blue Smoke concept, but this is the first time drinks come first and food is the complement.
2. The Cheesecake Factory wants a slice of something new.
Management said in February that it may buy or brainstorm another way of building business, and execs have let the mystery stand as to what or when it might diversify. Officials skirted the obvious question: What about the alternatives Cheesecake already has—Grand Lux Cafe and RockSugar Pan Asian Kitchen? Management said it will continue to focus on bolstering profits of Grand Lux, but kept mum about its Asian concept.
3. Texas Roadhouse tries a grill-and-bar spot.
Bubba’s 33 is described by the cowboy-theme older chain as a “family sports bar” that specializes in burgers, pizza and beer. The “33” refers to the temperature at which beers are served, as well as the percentage of meat that’s ground bacon in the concept’s signature burger. Founder and CEO Kent Taylor says the new channel is needed to provide staffers a new advancement path. It also gives another concept for partner-operators to develop and manage.
4. DineEquity’s adopted child still is a mystery.
The franchisor of IHOP and Applebee’s said in October that it intended to buy a third concept. But it was no more willing to share details in February during its quarterly financial update than it was before. The message from CEO Julia Child was that, like she said before, there were no specifics. She added, “It is absolutely what we’ve said all along, that it would not compete with family dining or casual dining, so that basically leaves specialty or fast casual.”
5. Dunkin’s home invasion.
The chain has inked a deal to sell K-Cups via grocery stores nationwide, a departure from its earlier licensing arrangement, which limited sales to Dunkin’ Donuts units. That earlier setup of having franchisees sell the K-Cups alleviated any firefights over cannibalization of sales and encroachment on exclusive territories. Dunkin’ is surmounting the problem in its new deal by giving franchisees half the proceeds from the sale of Dunkin’ K-Cups via supermarkets.
6. Red Robin takes on the city.
Aware that it’s known as a suburban sit-down, Red Robin launched a fast-casual spin-off, Red Robin Burger Works, for urban capitalization in 2011. While the chain pushed pause on its expansion, it’s back to growing in target markets. “Our fine-tuned real-estate strategy targeting dense urban areas is enabling us to bring Red Robin to trade areas we could never penetrate with the big box,” said CEO Steve Carley in a February analyst call.