BBQ Holdings is buying Bakers Square for the same reason many customers go there in the first place: the pies.
The owner of Famous Dave’s announced a $13.5 million deal to buy the chain along with sister company Village Inn. CEO Jeff Crivello on Friday provided a simple reason for the acquisition. “There’s nothing that goes better with barbecue than apple and peach pie,” he said.
It’s a typical response from what has been a fairly atypical industry executive. Crivello took over the struggling barbecue chain in 2017. In the years since, he’s taken numerous, often experimental steps in a bid to improve the company’s earnings power—from co-branding arrangements with several chains to ghost kitchens, innovative partnerships and tests of counter service and drive-thrus.
But he's also been making acquisitions—the company bought Granite City last year—and in addition to pies at Famous Dave’s, Crivello has plans for Village Inn, too.
“It’s something that stands the test of time,” Crivello said of the 135-unit chain. “It’s comfort food, All-America. Great service. Comfortable atmosphere. We have a prototype we’re working on for Village Inn, so that the franchise partners can see our vision and understand that we’re very long-thinking for the brand.”
Both Village Inn and Bakers Square have had a tough time over the years. Village Inn generated less than half of the sales it did five years earlier and had a third fewer locations in 2020, according to data from Restaurant Business sister company Technomic.
Bakers Square, which 15 years ago operated nearly 150 mostly Midwest units, is down to just 13 locations. “They went through a restructuring,” Crivello said. “They closed all the underperforming restaurants. The ones that are left are fairly viable. We’ll certainly do what we do at Famous Dave’s and find a way to maximize the restaurants for what they can be.”
Village Inn and Bakers Square have a complex ownership history. The two chains were acquired by Fidelity National Financial in 2009 and placed under the umbrella of American Blue Ribbon Holdings. But that company, which also owned O’Charley’s and 99 Restaurants, decided before the pandemic to stop funding losses at the two family chains and placed them into bankruptcy under a separate entity in January 2020.
During the bankruptcy process, each of those four chains was placed in separate companies, with American Blue Ribbon dissolved. The two chains, under a new company called VIBSQ, emerged from bankruptcy last year. And then BBQ Holdings stepped in.
“We’re excited for them, for the village Inn people, for Bakers Square. It’s a good strategic move,” said Craig Barber, who is CEO of the two chains along with O’Charley’s and 99. He will remain CEO of the latter chains after the deal. “For us, it’s a good opportunity to leverage all those things over the last several years as we restructured and went through the process. Obviously, BBQ Holdings felt like it was a good place.”
As for BBQ Holdings, the company is growing using three strategies. First, Crivello said, is to “maximize what we have,” meaning doing more with the large restaurants in the existing chains, including Granite City and Famous Dave’s.
That’s why the company has experimented with dual concepts, ghost kitchens and additional pickup points.
There is also organic growth. Dave’s is launching a new line of service—fast casual, rather than casual dining—and drive-thru prototypes, and operators are planning to open locations in that prototype.
And then there is more mergers and acquisitions.
“We’re busy,” Crivello said of all the activities. “We’re really proud of the teams and the effort they’ve put in and the success they’ve found.”
As for the pies, Crivello believes they will help Famous Dave’s while taking fuller advantage of the branding that Bakers Square’s pies still has. So while there may be a lot fewer Bakers Square locations, the pies could find new life.
“We can put Bakers Square pies into all of our restaurants,” Crivello said. “We can get into retail and other wider distribution. Whereas a lot of Bakers Square restaurants have closed over the years, people are still asking for pies.
“There’s a line around the block during holiday season to pick up their pumpkin and apple pies.”