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Cracker Barrel adds new programs for the sake of flexibility

The new initiatives include smaller family meals to go and the ongoing rollout of an alcohol program.
cracker barrel alcohol
Photograph: Shutterstock

With the marketplace in flux because of the worsening pandemic, Cracker Barrel Old Country Stores is embracing several new initiatives that promise greater flexibility in responding to the shifting realities, including a tweak of its holiday meals program.

Executives noted that the managers of its restaurants face a fluid situation that can change drastically, often with just a few days’ notice. Contending with dining-room reclosings and other immediate service limitations has been a challenge in fulfilling such routine duties as staffing a shift because the variables can shift so profoundly and instantly, CEO Sandy Cochran explained to financial analysts during the company’s first-quarter conference call.

“They did an excellent job of it, but it’s been tough,” she said of the field managers.

She noted that several new programs should increase the brand’s ability to adjust to the shifts, particularly the need to rely heavily or exclusively on takeout to sustain sales.

Those moves include the addition of a new smaller-sized option to the chain’s Heat ‘n Eat line, a menu of prepared takeout meals that customers re-heat at home before serving. The meals tend to be large, with enough meat and sides provided to feed 10, at a price of $139.99. To snag more families as takeout customers, Cracker Barrel added new versions that feed six people at a lower charge of $69.99. The family-oriented chain has also added a family-sized chicken-fried turkey meal for $39.99.

Cochran also revealed that a new adult-beverages menu has been introduced in 250 stores, with another 350 units likely to add beer and wine by the end of Cracker Barrel’s fiscal year. The alcoholic options are intended to increase the checks of dine-in customers when table service is permitted. The new menu accounts for 1% of sales at the units where it is now available, with most of that being incremental, Cochran said.

She projected that sales would double as more merchandising and promotion is employed. “We don't have our oil lamps or the dessert cards or the table tents, which was merchandising that would have been a great place to tell our guests about the new beverage program. And a lot of our guests, they know the menu so well, they don't actually look at it,” Cochran said.  The chain has spent about $6 million to date to add the beverages.

Cracker Barrel is also girding itself for the vagaries of the pandemic by embracing new technology, according to management. About 250 units have been outfitted with a new POS system that supports the use of tablets. “We certainly found tablets to be very beneficial in the stores that have them for our curbside and some of the off-premise piece of it,” said Jill Golder, Cracker Barrel’s CFO.

Cochrane said the new system, with its enhanced digital capabilities, had a decidedly positive effect on sales during the Thanksgiving season.

Not all of the coping mechanisms being developed for the brand are arising in headquarters. Cochran related how unit managers of some Kentucky stores along the Tennessee border started producing meals for their colleagues in Tennessee after Kentucky suspended dining room service. The moves helped the Tennessee restaurants bolster their throughput, the CEO said.

Cracker Barrel reported that sales for its namesake brand had climbed on a same-store basis to  83.6% of 2019 levels. Comparable sales for the company's secondary brand, Maple Street Biscuit Co., soared 20%, according to the parent company. 

Overall, net profits leapt 295%, to $170.7 million, on revenues of $646.5 million, a decrease of 14%. 

Correction: An earlier version of this story mistakenly indicated that results released by Cracker Barrel were for its second fiscal quarter, when in fact the figures were for the first quarter of fiscal 2021. 

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