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Emerging Brands

Texas Roadhouse set to expand little-known fast-casual brand

The high-flying company plans to add two Jaggers units to the two that are already open.
Photograph: Shutterstock

Texas Roadhouse plans to open two branches next year of its little-known third restaurant concept, a fast-casual sandwich specialist called Jaggers. 

The move comes as the company’s two full-service concepts are humming. Its 569-unit namesake chain posted a domestic same-store sales gain for the third quarter of 4.2% for domestic company-operated stores and 3.2% for franchises. 

Comparable sales for Roadhouse’s second concept, Bubba’s 33, jumped 8.8% for the quarter, according to company CEO Kent Taylor. He noted that about 2.5% of the gain came from the addition of lunch at five of Bubba’s 26 units.

Three months ago, in a discussion of the Roadhouse’s second quarter results, Taylor mentioned that the Bubba’s model was close to being finalized for rollout. His comments Monday on Q3 results suggest the company has reached that point. Stores under construction are 450 square feet smaller than older units, with one bar instead of two and four fewer TVs. The company plans to open eight Bubba’s units next year, compared with 22 Roadhouses.

Taylor did not say where the two Jaggers would be developed. The concept specializes in chicken sandwiches and burgers. Jaggers was started in 2015 with the opening of two stores in Indianapolis. They remain the only branches to date.

Roadhouse executives did not say why they decided to open two more Jaggers at this time.

The high-flying company is not alone among casual-dining operators in exploring an entry into the fast-casual market, which is outpacing the industry as a whole in growth. The Cheesecake Factory has opened a concept called Social Monk Asian Kitchen and has secured rights through its acquisition of Fox Restaurant Concepts to a health-oriented venture called Flower Child.

Outback Steakhouse has opened two units in the United States of a fast-casual concept it intends to expand overseas, Aussie Grill by Outback.

The parent of Applebee’s, the largest brand in casual dining, has indicated that it intends to acquire a fast-casual brand as a third expansion vehicle. The company, Dine Brands Global, is also the franchisor of IHOP.

Overall, Texas Roadhouse posted net Q3 income of $35.6 million, a 25.4% rise from the year-ago quarter, on revenues of $650.5 million, up 9.4%.

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