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The ONE Group operates 17 restaurants in five hospitality deals with hotels and casinos around the world. Among those are seven STK steakhouses, the company’s signature brand, which are designed to be sleek and trendy alternatives to the stuffy wood-paneled traditional model.
Jonathan Segal, ONE Group’s chief executive, describes STK as “taking out the business tie and putting in the girl, and taking out the business chatter and putting in the music.”
The stylish mostly-dinner-only restaurants have DJs and a lively social scene. About 43 percent of sales come from the bar.
Typically about 9,000 square feet, STK units average about $9 million in revenue per unit, with an average check of about $113 per person.
This year, ONE Group is launching a new variation of the brand, STK Rebel.
Designed for smaller spaces of roughly 5,000 to 6,000 square feet and second-tier cities, Rebel will offer the same break-the-mold vibe of an STK with a lower price point designed for the middle market, Segal said.
“It’s STK, but the rebel version of it, the naughty little sister,” Segal said. “The difference is that the menu is priced more accessibly for a larger demographic, and the restaurant is open for both lunch and dinner.”
The average check at Rebel is expected to be about $50 to $65 per person, and the company is targeting revenue of about $5 million per unit. The ratio of alcohol sales to food will likely be lower than STK, as Rebel locations will be open for lunch.
“The design is very stylized, like STK, but a little more relaxed, a little more ‘garage rock and roll,’” he said.
Most mid-priced steakhouse concepts are mere imitations of the high-end steakhouses that haven’t really changed in years, Segal said.
“It’s the oldest type of restaurant in America,” he said. “The wood paneling has gotten woodier, the red wine has gotten redder and the portions have gotten bigger. We were happy to redesign that paradigm for the high-end market, but now why not do it for the middle market?”
Segal said he couldn’t reveal where the first Rebel will open, but it will be in a major U.S. city. Once the concept debuts, however, rapid growth is planned.
The STK brand will also continue to grow. The company is projecting 11 locations will be open by 2015, including Miami and Chicago.
The company is also growing its hospitality business. Last month, ONE Group struck a hospitality services agreement with Melia Hotels International that will bring the STK concept, a rooftop bar and other concepts to the ME Milan Il Duca hotel.
For its March 31-ended first quarter, ONE Group said STK’s same-store sales rose 5.2 percent. Segal said being a publicly traded company has paved the way for new growth.
“Awareness of our brand has increased substantially,” he said. “There’s a credibility factor. Being a public company has opened doors.”