TAYLORS S.C. —Fatz Cafe has two rules it lives by, and the rules are posted on the chain’s website for all to see: “1) Regulars get treated special, and 2) Everyone’s a regular!”
Company executives say keeping that philosophy has generated consistent same-store sales growth through the years by forging a personal relationship with diners and building customer loyalty. —Fatz Cafe has two rules it lives by, and the rules are posted on the chain’s website for all to see: “1) Regulars get treated special, and 2) Everyone’s a regular!”
“They’re looking for food quality, they’re looking for hospitality,” said Steve Bruce, president and chief executive. “I think that’s what’s driving them to us. It’s the same people in the place time after time.” —Fatz Cafe has two rules it lives by, and the rules are posted on the chain’s website for all to see: “1) Regulars get treated special, and 2) Everyone’s a regular!”
Year-to-date same-store sales as of last month were up 3.2 percent, and Fatz Cafe has outpaced the casual-dining segment in sales growth in four of the last five years, he said. —Fatz Cafe has two rules it lives by, and the rules are posted on the chain’s website for all to see: “1) Regulars get treated special, and 2) Everyone’s a regular!”
Fatz Cafe was founded in 1988 in Spartanburg, S.C., by Jimmy Rogers, a peach farmer who converted a peach shed into the first restaurant. Bill Burton, now chairman of Fatz Cafe, acquired the chain in the mid-1990s. —Fatz Cafe has two rules it lives by, and the rules are posted on the chain’s website for all to see: “1) Regulars get treated special, and 2) Everyone’s a regular!”
All of the 36 Fatz Cafe restaurants are company-owned and located in four states: South Carolina, North Carolina, Tennessee and Georgia. The chain added seven restaurants in 2006, will open five this year and has seven openings planned for 2008, Bruce said. —Fatz Cafe has two rules it lives by, and the rules are posted on the chain’s website for all to see: “1) Regulars get treated special, and 2) Everyone’s a regular!”
Foodservice research and consulting firm Technomic Inc. recently ranked Fatz Cafe 33rd on its Top 100 Emerging Chain Concepts in America report and recognized the chain’s “strong operations management” as a factor in same-store sales growth. —Fatz Cafe has two rules it lives by, and the rules are posted on the chain’s website for all to see: “1) Regulars get treated special, and 2) Everyone’s a regular!”
Both Bruce and Richie Cannon, vice president of operations, said the chain’s operating partner program differentiates Fatz Cafe’s from franchised competitors by attracting managers who are deeply rooted in their communities. —Fatz Cafe has two rules it lives by, and the rules are posted on the chain’s website for all to see: “1) Regulars get treated special, and 2) Everyone’s a regular!”
“We have these hometown restaurants, and our people are part of these communities,” Bruce said. “We find very talented, capable leaders. We provide them a framework, give them a brand, we enter into an employment agreement and they make an investment in the company so they have something at stake.” —Fatz Cafe has two rules it lives by, and the rules are posted on the chain’s website for all to see: “1) Regulars get treated special, and 2) Everyone’s a regular!”
Fatz Cafe has limited its growth to the Southeast, and for a good reason. It’s the fastest growing region of the country in terms of population, Bruce said, and the four states where Fatz Cafe restaurants are located are the fastest growing part of the Southeast. —Fatz Cafe has two rules it lives by, and the rules are posted on the chain’s website for all to see: “1) Regulars get treated special, and 2) Everyone’s a regular!”
“There’s tremendous growth opportunity for us,” he said. —Fatz Cafe has two rules it lives by, and the rules are posted on the chain’s website for all to see: “1) Regulars get treated special, and 2) Everyone’s a regular!”
The chain’s plan for growth is based on opening units in contiguous markets, Cannon said. —Fatz Cafe has two rules it lives by, and the rules are posted on the chain’s website for all to see: “1) Regulars get treated special, and 2) Everyone’s a regular!”
“It doesn’t make sense to extend to Indiana,” he said. “[Expansion] will be at a growth rate and in a growth market that we can control.” —Fatz Cafe has two rules it lives by, and the rules are posted on the chain’s website for all to see: “1) Regulars get treated special, and 2) Everyone’s a regular!”
The restaurants are designed to convey a lodgelike feel with earth tones and solid-wood furniture. Fatz Cafe describes the look as “updated rustic,” with a stacked-stone façade and interior-wooden beams. The restaurants also display historic photos of the communities in which they operate. —Fatz Cafe has two rules it lives by, and the rules are posted on the chain’s website for all to see: “1) Regulars get treated special, and 2) Everyone’s a regular!”
The restaurants are one of two sizes. The 5,700-square-foot design has dining-room seating for 212 customers, and the 4,800-square-foot restaurant seats 172. Both have separate takeout entrances. —Fatz Cafe has two rules it lives by, and the rules are posted on the chain’s website for all to see: “1) Regulars get treated special, and 2) Everyone’s a regular!”
The size of new units is determined by development costs, which have “really escalated over the last several years,” Bruce said. —Fatz Cafe has two rules it lives by, and the rules are posted on the chain’s website for all to see: “1) Regulars get treated special, and 2) Everyone’s a regular!”
In addition to the Fatz Cafe’s management structure, its menu and service are key driving forces of the chain’s expansion, Cannon said. Travelers on vacation who eat at the restaurant often mention that they wished Fatz Cafe would open a restaurant in their community. —Fatz Cafe has two rules it lives by, and the rules are posted on the chain’s website for all to see: “1) Regulars get treated special, and 2) Everyone’s a regular!”
“We really focus on hospitality at the table,” Cannon said. —Fatz Cafe has two rules it lives by, and the rules are posted on the chain’s website for all to see: “1) Regulars get treated special, and 2) Everyone’s a regular!”
The chain’s World Famous Calabash Chicken is its signature dish, based on a style of cooking familiar to people along the North and South Carolina coasts, Bruce said. —Fatz Cafe has two rules it lives by, and the rules are posted on the chain’s website for all to see: “1) Regulars get treated special, and 2) Everyone’s a regular!”
Chicken tenders are coated in a spicy marinade, then hand-breaded and fried. The entrée item contains more than a half-pound of chicken and is served with honey mustard and a side item. —Fatz Cafe has two rules it lives by, and the rules are posted on the chain’s website for all to see: “1) Regulars get treated special, and 2) Everyone’s a regular!”
The chicken also is used as a base for other menu items, including salads and wraps. Fatz Cafe sells 16 million pieces of Calabash chicken a year, Cannon said. —Fatz Cafe has two rules it lives by, and the rules are posted on the chain’s website for all to see: “1) Regulars get treated special, and 2) Everyone’s a regular!”
The menu also features barbecued baby-back ribs, Cajun-Crusted Ribeye and other steaks, a variety of pasta, and seafood items including Steakhouse Salmon and Edisto Shrimp & Grits, which includes stone-ground cheese grits with Cajun jumbo and popcorn shrimp and chopped bacon drizzled with Burgundy-mushroom sauce. —Fatz Cafe has two rules it lives by, and the rules are posted on the chain’s website for all to see: “1) Regulars get treated special, and 2) Everyone’s a regular!”
CHAIN FACTS NAME: Fatz Cafe —Fatz Cafe has two rules it lives by, and the rules are posted on the chain’s website for all to see: “1) Regulars get treated special, and 2) Everyone’s a regular!” HEADQUARTERS: Taylors, S.C. —Fatz Cafe has two rules it lives by, and the rules are posted on the chain’s website for all to see: “1) Regulars get treated special, and 2) Everyone’s a regular!” MARKET SEGMENT: casual dining —Fatz Cafe has two rules it lives by, and the rules are posted on the chain’s website for all to see: “1) Regulars get treated special, and 2) Everyone’s a regular!” MENU: classic American with a Southern influence —Fatz Cafe has two rules it lives by, and the rules are posted on the chain’s website for all to see: “1) Regulars get treated special, and 2) Everyone’s a regular!” PER-PERSON CHECK AVERAGE: $12.15 —Fatz Cafe has two rules it lives by, and the rules are posted on the chain’s website for all to see: “1) Regulars get treated special, and 2) Everyone’s a regular!” TOTAL NUMBER OF UNITS: 36 —Fatz Cafe has two rules it lives by, and the rules are posted on the chain’s website for all to see: “1) Regulars get treated special, and 2) Everyone’s a regular!” LEADERSHIP: Steve Bruce, president and chief executive; Richie Cannon, vice president of operations —Fatz Cafe has two rules it lives by, and the rules are posted on the chain’s website for all to see: “1) Regulars get treated special, and 2) Everyone’s a regular!” ANNUAL SYSTEMWIDE SALES: $87 million —Fatz Cafe has two rules it lives by, and the rules are posted on the chain’s website for all to see: “1) Regulars get treated special, and 2) Everyone’s a regular!” YEAR FOUNDED: 1988 —Fatz Cafe has two rules it lives by, and the rules are posted on the chain’s website for all to see: “1) Regulars get treated special, and 2) Everyone’s a regular!”
Entrée prices range from $7.50 to $16.99. Fatz Cafe also has a special lunch menu with smaller, lower-priced portions. The menu contains such items as Sesame Oriental Chicken Stir Fry, Amarillo Chicken Philly, Southern Gold Ribs & Calabash and a create-your-own combo. —Fatz Cafe has two rules it lives by, and the rules are posted on the chain’s website for all to see: “1) Regulars get treated special, and 2) Everyone’s a regular!”
The chain recently added menu items based on consumer reaction during a one-year sampling program. Southern Spinach & Shrimp Dip, Ultimate Chopped Chef Salad and Baja Chicken Pasta are among the new items. —Fatz Cafe has two rules it lives by, and the rules are posted on the chain’s website for all to see: “1) Regulars get treated special, and 2) Everyone’s a regular!”
Fatz Cafe often adds menu items based on suggestions by diners, restaurant managers and employees, Cannon said. —Fatz Cafe has two rules it lives by, and the rules are posted on the chain’s website for all to see: “1) Regulars get treated special, and 2) Everyone’s a regular!”
“It’s not just us sitting in an office and saying, ‘This is a great item,’” he said. —Fatz Cafe has two rules it lives by, and the rules are posted on the chain’s website for all to see: “1) Regulars get treated special, and 2) Everyone’s a regular!”
Fatz Cafe has found that expanding the menu by using consumer suggestions helps sales because diners are “more educated than ever before,” Bruce said. —Fatz Cafe has two rules it lives by, and the rules are posted on the chain’s website for all to see: “1) Regulars get treated special, and 2) Everyone’s a regular!”
“They know what they like, they experiment more, and one of the things that hasn’t changed a tremendous amount is that they’re looking for value,” he said. —Fatz Cafe has two rules it lives by, and the rules are posted on the chain’s website for all to see: “1) Regulars get treated special, and 2) Everyone’s a regular!”
Two years ago Fatz Cafe saw an opportunity to increase sales of soup by offering a rotating menu that features the chain’s signature Loaded Baked Potato soup and two others that change daily, Bruce said. —Fatz Cafe has two rules it lives by, and the rules are posted on the chain’s website for all to see: “1) Regulars get treated special, and 2) Everyone’s a regular!”
Monday’s offerings, for example, are Kickin’ Crab & Sweet Corn Chowder and Tuscan Tomato in addition to potato soup. —Fatz Cafe has two rules it lives by, and the rules are posted on the chain’s website for all to see: “1) Regulars get treated special, and 2) Everyone’s a regular!”
Fatz Cafe competes against such larger casual-dining rivals as Applebee’s Neighborhood Grill & Bar and T.G.I. Friday’s, which does present challenges in maintaining a base of loyal customers, Cannon said. —Fatz Cafe has two rules it lives by, and the rules are posted on the chain’s website for all to see: “1) Regulars get treated special, and 2) Everyone’s a regular!”
“They have a much bigger marketing budget than we do,” he said. “They’re marketing very heavily. Being a smaller company, we have to work harder to build a loyal-guests base. We also compete with the fact that they have more to spend on real estate. They can buy great locations.” —Fatz Cafe has two rules it lives by, and the rules are posted on the chain’s website for all to see: “1) Regulars get treated special, and 2) Everyone’s a regular!”
TV is the predominant medium for Fatz Cafe’s advertising, used mainly for brand positioning and awareness, Bruce said. Radio ads are product-specific. Local-store marketing plays a big role in promoting the restaurants and building relationships in the community, he said. —Fatz Cafe has two rules it lives by, and the rules are posted on the chain’s website for all to see: “1) Regulars get treated special, and 2) Everyone’s a regular!”
Strong relationships with customers have been the bedrock for Fatz Cafe’s success, Bruce said, which gets back to the two rules that the chain lives by. —Fatz Cafe has two rules it lives by, and the rules are posted on the chain’s website for all to see: “1) Regulars get treated special, and 2) Everyone’s a regular!”
“We work hard to live that message and deliver on it,” he said. —Fatz Cafe has two rules it lives by, and the rules are posted on the chain’s website for all to see: “1) Regulars get treated special, and 2) Everyone’s a regular!”
