Opening two units of an upscale casual-dining concept just as the national economy plunged into a recession was never the plan, says Bobby Fitzgerald, a co-founder of the three-unit White Chocolate Grill based in Scottsdale, Ariz.
Leases were signed and construction began on the Chicago area and Denver area locations more than a year and a half before the economy showed signs of faltering. The units opened in the spring and then the fall of 2008. The first White Chocolate Grill debuted in Phoenix in 2004.
“It happened right out of the gate, but we have a great brand, we’re doing well and making money,” Fitzgerald says.
White Chocolate Grill’s three units average about 3,000 customers a week and about $5.3 million in annual sales, he says.
The new White Chocolate Grills are operating at a time of reduced consumer spending and traffic. The restaurants—with a $24 check average and Frank Lloyd Wright-inspired decor of wood and stone, leather and soft lighting—are at the high end of the beleaguered casual-dining segment. The segment has suffered as customers trade down to less expensive fast-casual and quick-service concepts or just eat at home to save money.
But despite the macroeconomics, White Chocolate Grill is succeeding because of a strong focus on operations, Fitzgerald says.
“The one thing we’ve done is create an attitude that we are only as good as our last meal served,” he says. “We operated this way before the ‘great recession’ hit. This constant self-pressure to perform for the guest is the reason we are doing well, regardless of the headwinds.”
While many casual-dining chains have been struggling—the segment posted declining same-store sales in the first quarter of 2009—experts say it is not impossible for individual operators to outperform the segment, particularly if the concept is able to lure guests with value-centric selections.
White Chocolate Grill offers a date-night fixed-price menu featuring four items—a single appetizer, two entrées and a single desert—for $29.95. The promotion is proving popular with customers, Fitzgerald says. The restaurants also began offering Sunday brunch in January and plans to introduce a private label wine.
BONUS POINT “In hard times, people who do a superior job are disproportionately rewarded. You have to run labor tight and look for promotional price points to get people in the door. I call them vehicles of value.”—Malcolm Knapp, president, Malcolm M. Knapp Inc., New York
White Chocolate Grill’s partners, Fitzgerald and John Carcasole previously had joined forces in 1999 to create two-unit buffet chain Cinzetti’s Italian Market in metro Denver and later in Overland Park, Kan. Cinzetti’s success has helped the partners to develop the much higher-end White Chocolate Grill.
Fitzgerald, a graduate of The Culinary Institute of America in Hyde Park, N.Y., originally had hired fellow CIA grad Robert Kabakoff as a consultant to help develop the menu. Kabakoff, chef-owner of a restaurant in Bend, Ore., later sold his restaurant and became a partner with Fitzgerald and Carcasole.
The partners have not been without serious challenges. They closed the second White Chocolate Grill in April, 14 months after it opened in Henderson, Nev. The location was never right and never caught on with the community, Fitzgerald says. They put it up for sale in July, before the economy tanked.
“We were struggling [in Henderson] from day one,” he says. “We knew it was a real estate mistake, and a costly mistake. But with it removed from our balance sheet, it has strengthened our ability to grow because it is no longer a drag on our financials. Our focus now is to build our cash reserves from our profitable restaurants and then get out and start pursuing sites again.”— [email protected]
This story is from the special report, “Playing to win: Calculated moves keep skilled operators on top of their game.” To read about other restaurateurs and operators making their moves to beat the recession, you can purchase the entire report by clicking here.
