The push by Famous Dave's of America for off-premise business tempered a drop in dining room traffic at company-run restaurants during the second quarter, holding the decline in same-store sales to 0.8%.
Comps for domestic franchised outlets, which make up the bulk of the casual barbecue chain, rose 0.7%, the company said.
CEO Jeff Crivello noted that the period marked only the second time franchisees have posted positive same-store sales since 2011. The chain has been pursuing a turnaround since about that time, though it continued to elude the brand during Q2. Overall, net income totaled just over $1 million, a 25.3% drop from the year-ago period, on revenues of $21.1 million, a jump of 45.3%.
Management said significant progress was made in the chain’s rejuvenation project during Q2. It cited the opening of a 2,300-square foot fast-casual riff on the big-box concept by a franchisee in Tucson, Ariz. If that experiment proves successful, chain officials have said, the mini Dave’s could become an important growth vehicle for the chain. “If it works, it will be a big deal, and we could fairly rapidly look to do more of these,” then-COO Geovannie Concepcion told Restaurant Business right before the unit opened.
Part of the test unit’s appeal is its reliance on off-premise business. Famous Dave’s has indicated that delivery and takeout will be essential to the brand’s future. In addition to the Tucson experiment, the chain has also been noodling the possibility of using the kitchens of its existing full-service restaurants as the foundation for a new delivery-only brand. It has also been exploring the use of so-called ghost kitchens—prep facilities that lack a dining room—rented by Kitchen United, a service that plans to open kitchen-only hubs for delivery by a number of restaurant brands.
Famous Dave’s did not reveal the increase in its delivery business during Q2, but noted that takeout sales at company units rose on a comparable basis by 6.8%.
The chain is also tweaking its menu. The fast-casual spinoff, for instance, features a much narrower bill of fare than a full-service Famous Dave’s typically does.
The brand also disclosed plans to develop faux-meat items to ride the public’s current interest in plant-based alternatives to beef, pork and chicken. One of the challenges for barbecue chains is building frequency, a function of their reliance on hefty servings of meat.
Famous Dave’s finished the quarter with 136 restaurants, or 14 fewer than were in operation at the same point in 2018. The company has been pursuing a program of buying franchised stores, updating the facilities and then refranchising them.
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