Fast-casual restaurant company eyes drive-thru units as lower-cost potential infill options
Portillo’s Inc. plans to expand its drive-thru-only Portillo’s Pick Up model to a second location in Rosemont, Ill., as it looks at ways of providing lower cost builds for infill locations, the CEO said Thursday.
The Chicago-based fast-casual brand, which is also expanding in the Sun Belt States, plans to modify the pickup model based on learnings from its first drive-thru-only location, which it opened a year ago February in Joliet, Ill., said Michael Osanloo, Portillo’s CEO, on a first-quarter earnings call.
Osanloo said the Rosemont location is in suburban Chicago, bordering O’Hare International Airport
“It's a fantastic location that will benefit from both airport and entertainment traffic,” Osanloo said. “This will be the second location to offer drive-thru and pick up — no dining room.” The Joliet unit also provides catering service, he said.
Some modifications are planned, he added.
“As happy as we are with the performance of our first Portillo's Pick Up in Joliet,” Osanloo explained, “we've learned a ton over the past year about how to make that format and the operations of it even more efficient. We continue to believe that traditional restaurants are the primary means for our growth but, as an infill strategy, Portillo's Pick Up locations have the potential to drive standard-sized restaurant revenue and margin dollars through a lower cost build.”
The Pick Up units have no dine-in capacity and are for drive-thru, pickup, to-go and delivery.
“The god’s honest truth is we probably overbuilt that restaurant,” Osanloo said. “I think we've discovered that we can build a smaller footprint, a little bit of a tighter kitchen.”
Those Pick Up units could serve as inflll locations in markets that have achieved scale, he said.
For the first quarter ended March 26, Portillo’s swung to a loss of $1.3 million, or one cent a share, from profit of $550,000, or zero cents a share, in the same period last year. Revenues increase 16% to to $156.1 million, from $134.5 million in the prior-year quarter.
Same-store sales in the quarter increased 9.1%.
Portillo’s opened three new restaurants in the quarter and an addition unit in Gilbert, Ariz., after the period’s end. The company now has 76 restaurants, including one in which Portillo’s owns 50% of the equity.
Contact Ron Ruggless at [email protected]
Follow him on Twitter: @RonRuggless
