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Emerging Brands

Famous Dave's parent wants to add more brands

BBQ Holdings is shopping for a breakfast, pizza or "saloon" brand that it can pair with Famous Dave's and its secondary sister, Granite City.
Photograph: Shutterstock

The parent of Famous Dave’s and Granite City Brewery is shopping for a pizza concept and a breakfast partner as it strives to broaden the appeal of its casual-dining operations through co-branding and the adoption of virtual concepts, the company revealed Tuesday.

The push for broader appeal extends to diversifying service formats as well as menu focus. BBQ Holdings alerted the financial community that it intends to develop 4,000-square-foot versions of Clark Crew BBQ, the high-volume operation developed in collaboration with Travis Clark, a much-celebrated star of the competitive barbeque circuit. BBQ noted that it holds rights to franchise Clark Crew under the partnership agreement with Clark.

The lone Clark Crew should generate revenues of more than $7.5 million this year, BBQ projected.

The company also reaffirmed its plan to use Real Urban Barbecue, a one-unit fast-casual restaurant it acquired last year, as a springboard for additional takeout and delivery business. In a revised presentation to investors, BBQ indicated that it and its franchisees might open more Real Urban branches.

They’re already putting the heart of the concept, a fast-casual-like order-assembly line, into existing Famous Dave’s stores as a way of adding drive-thru service. The parent company said the service format, developed by Chicago chef Jeff Shapiro, can provide customers with a high-end barbecue meal in under two minutes. It projected the brand will generate at least $2 million in revenues this year.

The flurry of initiatives follows BBQ’s enthusiastic embrace of ghost kitchens. Currently, seven units of the Granite City brewpub chain are functioning as production facilities for Famous Dave’s-brand takeout and delivery meals, at a typical volume of $7,000 per week in sales.

In addition, Famous Dave’s has a deal to use up to 25 Johnny Carino’s casual Italian restaurants as ghost kitchens, and has six ghost kitchens in facilities that house the production facilities of multiple brands.

BBQ said that meeting the extra volume generated by a virtual concept is not a problem for the Granite City restaurants. The kitchens of those stores were designed to handle $6 million in annual volume. Even in pre-pandemic days, the units were taking in only $3.9 million on a yearly basis.

The company revealed it intends to bolster the volume of its Granite City chain, which currently extends to 18 locations, by adding a breakfast component to 10 stores. It indicated that the add-on operation would be a known brand.  

A high-end venture featuring “innovative” omelets, French toast and pancakes, plus alcoholic beverages, could add another $1.5 million in operating revenue, with 25% of that channeling through as operating income, BBQ said.

The multi-brand company stressed that the venture isn’t so far afield as it might sound for a brewpub. A typical Granite City unit generated at least $380,000 annually at brunch, and liquor accounts for 20% of the store’s average unit volume of more than $3.8 million.

It also noted that the breakfast component would operate from 6 a.m. to 2 p.m., when brewpubs tend to be dead business-wise.

A hunt is already underway for a possible pizza or “saloon” partner for 125-unit Famous Dave’s, still BBQ’s core business. The add-on could be a virtual concept or a brick-and-mortar bolt-on, and either a branch of a brand outside BBQ’s portfolio or an acquisition, the company indicated.

It forecast that the addition of a pizza or saloon concept would bolster a unit’s sales by $800,000per year, with a flow-through of 25%.

In addition to its ghost-kitchen ventures, BBQ currently has one full-fledged co-branded restaurant, a pairing of a Famous Dave’s with a Texas T-Bone steakhouse. A unit combining brick-and-mortar elements of a Famous Dave’s with a Johnny Carino’s unit should open in 2021, according to BBQ.

In a slide deck intended to serve as the company’s standard presentation to investors and financial analysts, BBQ spelled out what type of brands may end up in its fold through acquisitions. Candidates should be “legacy” brands, franchise-able and a foundation for licensing deals that put signature products of the purchased operation on retail shelves.

“We are diligently working to execute our organic and M&A growth plan, while continuing to adjust with the fluid COVID restrictions,” BBQ CEO Jeff Crivello said in a statement. “We believe there is a significant amount of pent-up demand for dining, and expect demand to grow throughout the year.”

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