What is in this article?:
- Ruby Tuesday looks to lift same-store sales
- Analysts weigh in
Menu overhaul, closing underperforming restaurants will help, company says
Ruby Tuesday Inc. said Wednesday that a menu overhaul and closing underperforming restaurants would help it improve same-store sales.
James J. Buettgen, chairman, president and chief executive of the Maryville, Tenn.-based company, said cost savings from administration and waste management would also improve profitability, as would the closure of 24 underperforming restaurants in the third quarter.
Ruby Tuesday’s same-store sales in the third quarter ended March 4 fell 1.9 percent at company-owned units and 2.2 percent at franchised locations. However, the company said the downward trend in same-store guest counts improved from the second quarter, slipping 1.7 percent compared with a 6.3 percent decline in the second quarter.
Ruby Tuesday, which also owns the Lime Fresh brand, has closed more than 30 units in the past year and plans to shutter six to nine more Ruby Tuesday locations this quarter, executives told analysts in a call after releasing third-quarter earnings.
“We made solid progress over the past eight months in key areas of our brand transformation,” said Buettgen. “We remain intently focused on reengineering our core menu, continuing to add innovative new products, and simplifying recipes and procedures while ensuring we have meaningful variety and strong value across a wide range of price points."
Among the new entrees introduced in the quarter were Low Country Shrimp & Grits and Baked Ravioli.
Buettgen also said the 722-unit Ruby Tuesday brand was fine-tuning its promotion strategies.
“A great example of this is our ‘20 meals under $10’ campaign, which began in early January,” Buettgen said. “This promotion, which was supported by five weeks of national television advertising, showcased the wide variety of menu items under $10 that are available every Tuesday.”
Those items include burgers, tacos, flatbreads, Southern-style chicken tenders and the Garden Bar.
“This promotion was popular with our guests and demonstrates the depth of affordable variety in our menu, with menu items to suit the appetites of guests looking for something indulgent to those that are more health conscious,” Buettgen said.