HRI Inc. is updating its Houlihan’s brand with two recent remodels, and is eyeing growth for its J. Gilbert’s Wood-Fired Steakhouse concept, CEO Mike Archer said this week.
Archer, who partnered with private-equity firm York Capital Management to buy the 90-unit Kansas City, Mo.-based company in late 2015, said both brands occupy strong positions in their segments.
Archer, the former president of DineEquity’s Applebee’s division before it moved to California, said Houlihan’s “posh casual” positioning can compete with local independents. Recent renovations of restaurants in Dallas and Leawood, Kan., are aimed at solidifying that position.
“As we’ve taken a look at the business over the course of the past year, one of the things we’ve really focused in on is the idea that the consumer is really looking for an experience more than ever before,” he said. “At one time, restaurants were rewarded for being consistent and predictable and feeling the same.”
That worked when he led concepts like Morton’s, Archer said, but consumer demands have shifted.
“Today, I believe guests want unique and authentic experiences,” he said. “So our challenge is to make this less of a cookie-cutter brand and really have a local emphasis.”
The recent remodels of a 10-year-old Dallas unit and a 30-year-old restaurant in Leawood, Kan., reflect the individualized identities the company wants to spread throughout the 71-unit brand. Both remodeled units are in the company-owned portfolio of 32 restaurants. The remainder are franchised.
“There will not be another restaurant to be remodeled to look like those,” Archer said. “Each restaurant will have its own personality and look and feel to it.”
Houlihan’s debuted in 1972, Archer said, so restaurant sites offer some unique locations as the company expanded over 45 years. The brand will play to location and architectural strengths as it renovates others.
“We have the core menu and a specials card,” Archer said, with offerings that include items that appeal to diners looking for high-protein, low-calorie or low-sugar items.
“We have a number of things that meet the customer’s view of ‘better for you,’ and not just one single definition,” he said.
Houlihan’s has also worked on the flavor profiles of dishes, Archer said, producing newer items like black bean dip with harissa chili pepper paste, and a recent addition of half a pan-roasted, skin-on chicken breast with spiralized sweet-potato linguini and a poblano cream sauce.
Staff has been retrained to help customers navigate the changes, he added.
“We’re focusing our culture on being more guest-centric,” Archer said. “We did an exercise with all of our general managers where we had them write — collectively, as a group — their definition of the perfect guest experience. We gave them certain writing prompts, such as, ‘When I drive into the parking lot,’ or, ‘When I walk up to the door.’”
The exercise resulted in a new approach to how the team approaches customers.
“It was fascinating to watch this group of seasoned general managers struggle with the experience from a sensory perspective,” Archer said. “They got into the groove after they got less into the function and more into the purpose of why we do things. We are spending a lot of time in communicating why we do things.”
Archer said he sees Houlihan’s competition less as other polished-casual chains and more as local upper-scale independent restaurants.
“We’re working on retraining our staff so they can be more ‘guides through the journey’ of these new flavors,” he said.
Houlihan’s has also overhauled bar offerings by introducing new craft cocktails and local beers, as well as touches such as ice cubes infused with Aperol.
“It’s all starting to come together,” Archer said. “It’s been a year. Our menu is coming together with new flavors. We’ve done the two remodels and plan to continue that. We’re putting more control in the hands of our general managers.”
Archer added that he foresaw growth as slow and measured in existing markets.
“Our expansion and growth plans are really focused around Houlihan’s and J. Gilbert’s,” he said.
HRI also owns the Bristol Seafood Grill and Devon Seafood Grill brands.
He said the five J. Gilbert’s units are doing “exceptionally well,” with an average check of $55 to $60. Houlihan’s check average is about $18, he said.
“J. Gilbert’s is a great experience of prime steaks at a lower price point,” Archer said, adding that expansion would be focused on medium-sized cities like Kansas City, Mo.; Columbus, Ohio; Pittsburgh and Indianapolis.
“We’re working on a couple of leases now, and I would expect the first to open late this year or early next year,” Archer said.
Contact Ron Ruggless at [email protected]
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Correction Jan. 23, 2017: This story has been edited to correct the name of Devon Seafood Grill.
