Habit Burger Grill pledges to sidestep discount warsHabit Burger Grill pledges to sidestep discount wars

The Habit Burger Grill credited a Super Food Salad limited-time offer, targeted digital marketing and innovative media partnerships with boosting second-quarter same-store sales 4 percent, parent company The Habit Restaurants Inc. said Wednesday.

The same-store sales increase for the quarter ended June 28 was driven by a 4.3-percent increase in average check, partially offset by a 0.3-percent decrease in transactions.

“I think it is important to mention that we only spent around 60 basis points towards marketing. And that the real story with The Habit is about our focus on quality and our everyday value, and how these help us drive customer loyalty and repeat business,” said Russ Bendel, president and CEO of The Habit Restaurants, in a call with analysts.

The Super Food Salad introduced in May featured marinated, char-grilled chicken breast over baby kale with quinoa, tomatoes, cucumbers, carrots, feta, dried cranberries and slivered almonds in a kale-pesto dressing, and was the most popular ever featured at Habit Burger Grill, Bendel said.

Its success “underscores our ability to focus on quality to drive traffic and not take part in the intense discount wars going on in the QSR category or discounting that we’ve seen increasing in casual dining over the last few weeks,” he said.

Effective use of Habit’s CharClub email database helped tell the chain’s story, Bendel added. And sales and traffic were driven by a partnership with Los Angeles radio stations in which a fleet of Habit Burger food trucks were used to raise money for charities picked by on-air personalities.

Bendel described the competitive environment as “bumpy” and “choppy,” but said the chain plans to “stay true to who we are” and focus on creative marketing rather than discounting.

“We feel when we come out of it, we're going to come out of it as strong as we did at the end of 2009 and 2010 — they were tough years,” Bendel said. “We stayed positive then. We feel at least the consumer environment feels pretty similar to what it was then, and you'll probably see less new seats coming into the restaurant space maybe in the next year or so. So there's always something favorable that comes out of challenging times.”

It was the 50th consecutive quarter of positive results for the Irvine, Calif.-based chain, which posted net income of $1.2 million, or 7 cents per share, compared with $0.7 million, or 5 cents per share, a year ago.

The chain added six company-owned restaurants and one franchised unit during the quarter, for a total of 146 company-operated and six franchised or licensed units.

For the year, Habit Restaurants expects same-store sales at company-owned restaurants to increase between 2 percent and 2.5 percent, and revenue to be between $284 million and $286 million.

A projected 29 to 31 company-owned units and five to seven franchised/licensed restaurants will open.

Contact Lisa Jennings at [email protected]
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