As the nation’s largest family-dining chains revamp their building prototypes, menus and service styles to keep fast-food and casual-dining operators from luring away customers, the segment’s second-tier players also are reviewing their operations and brand identities to stave off competition.
However, Josh Kern, vice president of marketing for Denver-based Vicorp Restaurants, parent of the 255-unit Village Inn and 146-unit Bakers Square brands, says that while he sees merit in countering competitive incursions by burger brands and dinnerhouses, he worries more about bakery-cafe players encroaching on his market.
Last year Bakers Square and Village Inn reported combined systemwide sales of $577 million, up just 1.4 percent from a year earlier.
While many family-dining rivals revamp takeout elements of their operations to adapt utilitarian fast-casual signatures, Kern is concerned that such a strategy could backfire on Vicorp, given the age of his chains’ typical guests.
That’s why only Vicorp’s Denver market has a few outlets testing stylish takeout counters at cashier stations.
“Of course, meals-to-go is easier to understand in those formats where it makes sense and is not confusing to the guest,” Kern says. “But in our space, it’s hard to get the consumer to understand that service model.”
As some Village Inn and Bakers Square units add emphasis to take-out meal options, Kern remains uncertain whether the chains should market fast-casual’s service style on a larger scale as a distinct feature.
One of the reasons for his reluctance is that both brands play to an older diner who may not be time-pressed.
“There’s no doubt that getting a meal to our guest fast is important,” he says, “and our counters certainly afford that. But there is a balance that has to be met. For example, we serve a lot of pie at the counter, and it’s one of the occasions when guests do not feel badly about eating alone and there is a leisurely pace.”
Nevertheless, Kern says, Vicorp also must play to a younger demographic since so many of “our core guests are leaving us.”
“Younger people think of our brands as the restaurant they visited with their grandparents,” he says.
One way both brands are looking to shore up business with younger guests is by enlarging the menu for late-night snack occasions, he says.
Huddle House is another family-dining chain that is focusing more on its core operations and less on borrowing from other categories to grow its business.
The 428-unit, Atlanta-based Huddle House reported $235 million in systemwide sales last year, up 3.5 percent.
Key to the chain’s modest growth is maintaining a value-focused pricing strategy that is comparable to that of quick service but offered in a full-service format, officials say.
The chain’s average check is about $5.62, about the same as fast food, but the menu is much more diverse and is offered in a more comfortable dining environment, chief marketing officer Robyn Bailey said earlier this year.
Huddle House kicked off several weeks ago a marketing campaign intended to reward customer loyalty with the promise of a $100,000 prize. In a nod to the chain’s history, the campaign features a “new menu” that highlights old, signature menu items, like its breakfast platter, with some new chicken and seafood additions.
Along with the menu change, the company has remodeled half of its units to create a more contemporary and brighter dining environment. The new stores have a diner atmosphere, with red bar stools, a stainless-steel backdrop, and green and white floor tiles with red accents.
But not all Second 100 family-dining chains see their fast-food and casual-dining competition as negligible. For a few, the motto seems to be, “If you can’t beat them, join them.”
Warren, Mich.-based Big Boy, which turned in a flat $432 million in systemwide sales on 269 stores, is adding fast-casual service features to its units and has rolled out a standalone unit for shopping malls and airports.
Meanwhile, Shoney’s—the putative segment leader of the Second 100 family-dining category, despite a 3-percent decline in systemwide sales, to $423 million, on 18 fewer restaurants, or 267 units—is embracing casual dining’s seasonal menu promotion strategy this summer with a host of new dishes built around basket plate presentations.
As part of the promotion, the chain is featuring seven new meal combos such as a BBQ Chicken Basket and a Ribs Basket. Everything is available for takeout as well.
FAMILY CHAINS RANKED BY U.S. SYSTEMWIDE SALES
| LATEST- YEAR RANK | PREC.- YEAR RANK | CHAIN | FISCAL YEAR-END | U.S. SYSTEMWIDE FOODSERVICE SALES* (BY FISCAL YEAR, IN MILLIONS) | ||
| LATEST | PRECEDING | PRIOR | ||||
| 1 | 2 | Big Boy Restaurant & Bakery | Dec. ’07 | $432.0 | $434.0 | $428.0 |
| 2 | 1 | Shoney’s | Oct. ’07 | 423.4 | 434.9 | 462.8 |
| 3 | 3 | Village Inn | Oct. ’07 | 372.0 | 361.3 | 342.8 |
| 4 | 4 | Sonny’s Real Pit Bar-B-Q | Dec. ’07 | 284.0 | 289.0 | 289.1 |
| 5 | 5 | Huddle House | April ’08 | 235.0 | 227.0 | 210.0 |
| 6 | 6 | Bakers Square | Oct. ’07 | 205.0 | 208.0 | 215.6 |
| 7 | 8 | Coco’s | Dec. ’07 | 189.5 | 189.2 | 190.2 |
| 8 | 7 | Eat’n Park | Dec. ’07 | 188.0 | 191.5 | 182.6 |
| TOTALS: | $2,328.9 | $2,334.9 | $2,321.1 | |||
FAMILY CHAINS RANKED BY GROWTH IN U.S. SYSTEMWIDE SALES (Year-to-year percentage change)
| LATEST-YEAR RANK | PREC.-YEAR RANK | CHAIN | FISCAL YEAR- END | LATEST* VS. PRECEDING | PRECEDING* VS. PRIOR |
| 1 | 1 | Huddle House | April ’08 | 3.52 | 8.10 |
| 2 | 2 | Village Inn | Oct. ’07 | 2.96 | 5.40 |
| 3 | 6 | Coco’s | Dec. ’07 | 0.16 | -0.53 |
| 4 | 4 | Big Boy Restaurant & Bakery | Dec. ’07 | -0.46 | 1.40 |
| 5 | 7 | Bakers Square | Oct. ’07 | -1.44 | -3.53 |
| 6 | 5 | Sonny’s Real Pit Bar-B-Q | Dec. ’07 | -1.73 | -0.03 |
| 7 | 3 | Eat’n Park | Dec. ’07 | -1.83 | 4.87 |
| 8 | 8 | Shoney’s | Oct. ’07 | -2.64 | -6.03 |
| AVERAGE: | -0.18 | 1.21 | |||
FAMILY CHAINS RANKED BY NUMBER OF U.S. UNITS
| LATEST- YEAR RANK | PREC.- YEAR RANK | CHAIN | FISCAL YEAR-END | YEAR-END NUMBER OF UNITS* | ||
| LATEST | PRECEDING | PRIOR | ||||
| 1 | 1 | Huddle House | April ’08 | 432 | 428 | 396 |
| 2 | 3 | Big Boy Restaurant & Bakery | Dec. ’07 | 269 | 272 | 269 |
| 3 | 2 | Shoney’s | Oct. ’07 | 267 | 285 | 293 |
| 4 | 4 | Village Inn | Oct. ’07 | 255 | 256 | 240 |
| 5 | 5 | Bakers Square | Oct. ’07 | 146 | 148 | 151 |
| 6 | 6 | Sonny’s Real Pit Bar-B-Q | Dec. ’07 | 139 | 145 | 149 |
| 7 | 7 | Coco’s | Dec. ’07 | 110 | 113 | 115 |
| 8 | 8 | Eat’n Park | Dec. ’07 | 79 | 81 | 79 |
| TOTALS: | 1,697 | 1,728 | 1,692 | |||
FAMILY CHAINS RANKED BY GROWTH IN NUMBER OF U.S. UNITS (Year-to-year percentage change)
| LATEST-YEAR RANK | PREC.-YEAR RANK | CHAIN | FISCAL YEAR- END | LATEST* VS. PRECEDING | PRECEDING* VS. PRIOR |
| 1 | 1 | Huddle House | April ’08 | 0.93 | 8.08 |
| 2 | 2 | Village Inn | Oct. ’07 | -0.39 | 6.67 |
| 3 | 4 | Big Boy Restaurant & Bakery | Dec. ’07 | -1.10 | 1.12 |
| 4 | 6 | Bakers Square | Oct. ’07 | -1.35 | -1.99 |
| 5 | 3 | Eat’n Park | Dec. ’07 | -2.47 | 2.53 |
| 6 | 5 | Coco’s | Dec. ’07 | -2.65 | -1.74 |
| 7 | 7 | Sonny’s Real Pit Bar-B-Q | Dec. ’07 | -4.14 | -2.68 |
| 8 | 8 | Shoney’s | Oct. ’07 | -6.32 | -2.73 |
| AVERAGE: | -2.19 | 1.16 | |||
Second 100 chains see slowed sales growth for second consecutive year
