Offering groceries along with Beef ‘O’ Brady’s usual fare has significantly tempered the sales declines of the 20 restaurants in the casual chain that are giving retail a try. “The guy who’s doing the best with it is down 13%, while the rest of the system is down 70%,” says CEO Chris Elliott.
But there’s ample reason why the other 130 stores aren’t racing to add shortening or gallons of milk to their product lines.
Part of the hesitation, says Elliott, is location-related—“the neighborhood you’re in, the trade market you’re in.” The demand may not be there, regardless of how stocked or empty local supermarkets might be.
The other consideration, Elliott says, is the sheer amount of energy that’s required. Plenty of restaurants have pivoted to grocery as a way of generating much-needed sales while dining rooms are closed and takeout and delivery are providing only a fraction of pre-COVID-19 sales. But in Beef ‘O’ Brady’s experience, it’s hardly a cinch.
“Only our most ambitious and entrepreneurial operators are doing it,” Elliott explains. “They’re also doing takeout and delivery and online ordering. There’s ordering and inventorying these products you don’t usually work with, basically figuring out how to hold them, how to merchandise them.”
A big part of the challenge, he says, is marketing the availability of products that consumers may never have associated before with a Beef ‘O’ Brady’s. Such as protective vinyl gloves.
“You’ve got to get the word out, so we put some effort into our email club and in our social media,” Elliott says. “We’ve done some point of purchase materials for the front of the store.”
Despite the challenges, the payoff from selling groceries has prompted Beef ‘O’ Brady’s to assume much of the spade work in hopes the effort will prompt more franchisees to give retail a try.
The home office worked with one operator to develop a list of retail products, a template that any operator can use as a punch list of sorts of what to stock. The roster ranges from sliced white bread to tail-on shrimp, margarine, chopped romaine, cheeses, chicken breasts, potatoes and limes. Bottles of wine and six-packs of beer are also offered, both for to-go and delivery.
Like other operations that have diversified into retail during the pandemic, Beef ‘O’ Brady’s entered the field with a why-not shrug. Supermarkets were getting cleaned out by consumers stockpiling goods for sheltering at home, but distributors were wondering what to do with full warehouses amid a sudden drop in demand from their restaurant partners.
“We still had access to products that were not in the grocery stores,” says Elliott. In putting together the product list, “it was a little bit of trial and error, but mostly it was what the grocery store was running out of. There was no hamburger meat, no chicken, no paper towels, no produce. We had all of those things.”
The home office also put together meal kits, essentially packaging together some of the retail items. “We came up with five family meal deals that are selling like crazy,” says Elliott.
Still, he doesn’t expect any of the 20 restaurants offering retail to continue functioning as scaled-down grocers once normalcy returns.
“If the business ramps back up to an order of normal, I think this will fade away because we will have our hands filled running our dining rooms and kitchens,” he says.