Cheesecake Factory has become a takeout factory.
The casual dining chain known for its giant menus served in giant restaurants with a large serving of cheesecake has become a top destination for consumers who’d rather eat the food lounging on the sofa at home.
That hasn’t changed even as more customers start coming into the restaurants. On Wednesday, the Calabasas, Calif.-based company said that same-store sales at its flagship chain rose 41% in the third quarter ended Sept. 28, and 8.3% on a two-year basis.
Those sales have improved further since then, with same-store sales now 10.5% thus far in the fourth quarter over the same period in 2019.
More than a quarter of the chain’s sales, however, are for takeout and delivery. The company said that 28% of its sales are coming through those channels, or about $60,000 per week, per restaurant. That’s nearly double over pre-pandemic levels.
On an annualized basis, that’s about $3 million a year, or about the same unit volumes of your typical Outback Steakhouse location.
The increase has the company’s executives more confident in the potential for the business. “The meaningful increase in off-premise could be a long-term sales driver for Cheesecake Factory as we emerge from the pandemic,” Company President Dave Gordon told analysts and investors on Wednesday.
Casual dining restaurants of all kinds have been able to generate stronger takeout sales since the start of the pandemic, as consumers were unable or unwilling to dine in restaurants but still wanted restaurant food. For some it proved to be a lifeline that kept them afloat.
Now, with the pandemic easing and consumers returning to restaurants, more casual diners view this as a sales channel they can continue to manipulate.
That these sales have continued at elevated levels in the post-pandemic era has operators thinking they will remain over the long term. Cheesecake last week gave digital customers free slices of cheesecake with delivery orders of $40 or more in a Halloween Treat or Treat promotion.
The chain’s takeout business is luring new customers who are becoming more loyal in the process, executives said. David Overton, the company’s CEO, said Wednesday that about a third of the chain’s frequent customers—who use the chain an average of 20 times a year—are new customers.
Those customers are not just takeout customers, either. “Our frequent guests are omnichannel,” CFO Matthew Clark said. “They come to us with delivery, pickup and on-premise.”
Clark couldn’t say yet whether the growth in takeout could influence the chain’s decisions on locations.
And he said the company itself is “agnostic” on in-restaurant versus out-of-restaurant dining, saying that both of the orders generate the same level of profitability. “The labor is a little bit of a different model, with the delivery commission, but it nets out pretty equally,” Clark said. “We’re agnostic. We’ll drive omnichannel. Whatever the guest wants to do.”
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