Sam Borgese is confident that he can fix what ails Coco’s and Carrows.
To be sure, that’s a common trait among CEOs and especially among executives who are often brought in to repair downtrodden companies. Yet Borgese has a particular reason for his confidence: He’s fixed the brands before.
Borgese, after all, was CEO of Coco’s and Carrows from 2003 to 2008.
“I think we have the inside rail for how to do that really well,” Borgese said.
Borgese is the CEO of Shari’s Management Corp., the owner of Shari’s Restaurants that quietly bought the struggling Coco’s and Carrows from Food Management Partners over the summer.
The acquisition will provide yet another test for Borgese, who has worked with Logan’s Roadhouse, Charlie Brown’s steakhouse and other concepts.
And it came as he was in the midst of another turnaround—that of Shari’s.
Shari’s 2.0
Borgese was named Shari’s CEO in August of 2017 and tasked with revitalizing the 40-year-old, Beaverton, Ore.-based chain.
Shari’s has 94 locations, but it has struggled from a sales standpoint for years. Its compound annual growth rate is -1.3% over five years. By contrast, the average growth rate for family-dining chains has been 2.3% over that time, according to Technomic Ignite data.
Borgese is working on what he calls Shari’s 2.0, a rethinking of the chain’s look and menu.
The family-dining chain is testing a redesign and a new menu at a single location.
Borgese said that the company has spent much of the past 12 months planning the effort. “It was the first time in 40 years that anybody had done an A-to-Z look at the brand, especially on the menu level,” he said.
The menu removed items that didn’t sell well and replaced them with newer items and categories. Around 40% of the menu the company is testing is brand new.
The menu includes melts and open-face sandwiches and “comfort foods” that have proven popular in early results.
And it includes pot pies. “We pull off a strong pie, but it’s mostly a sweet pie business,” Borgese said. “Going into savory pies was a natural for us.”
The company also improved speed of service by 40%. And it separated the area where delivery orders are picked up to reduce confusion and improve service.
“That turned out to be a really good move,” Borgese said, noting that at the moment, 60 of the chain’s 94 locations have the service. The company has moved the delivery staging area off to the side.
And the company started having waitstaff take customer checks. “That took away a lot of the bottleneck happening at the entry of the building,” he said.
Borgese said that the company’s newly remodeled location with its new menu has settled into “low double-digit positive” same-store sales. He said the company would wait until after the holidays to make tweaks before the menu is expanded to the whole system and the brand looks to remodel other locations.
“We’re optimistic at the moment,” Borgese said.
Back to Coco’s
Borgese helped Coco’s and Carrows recover from a 2001 bankruptcy and guided them through their 2006 sale to Zensho America. But the brands struggled and by 2015 Zensho unloaded them to FMP, the owner of buffet brands such as Ryan’s and Old Country Buffet that had been buying up cheap chains.
The two brands operated 149 locations when Zensho sold them to FMP, which quickly shut units. Today they are down to 44 corporate locations and 11 franchised.
Borgese said that the brands have been “somewhat on their own for a couple of years.” But he believes there’s “a real path to grow the brand.”
“It has a lot to offer,” he said.
He said the plan is to establish the brands in their core Los Angeles market. He said the brands are adding a new point-of-sale system and an improved loyalty program.
And then Borgese said there’s a list of “instant winners” for the brands, including a lighter, brighter interior and exterior, new uniforms and color schemes and an improved customer experience.
“I think there’s not as much work, believe it or not, that we had in going A-to-Z with Shari’s,” Borgese said. “It’ll be a lot faster with a lot less process than we put into Shari’s.”
He said the company could improve its branding and do more local store marketing. And he said it plans to add more “Instagrammable products,” similar to what’s been done at Shari’s.
“It’s a competitive environment,” Borgese said. “I don’t think it’s a dead brand by any means.”
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