Incoming CEO discusses brand’s menu, growth strategy
As he thought about exiting P.F. Chang’s for Portillo’s Hot Dogs, Michael Osanloo drove to the hot dog chain’s Tempe, Ariz. location near his home for a closer look at the beloved Chicago-based brand.
The restaurant’s famed double drive-thru lanes were overflowing with 40 cars. The fan base, he thought, rivaled that of Southern California fast-food icon In-N-Out Burger.
“I was blown away,” Osanloo said.
Osanloo, currently the CEO of of P.F. Chang’s China Bistro, accepted the top job at Portillo’s soon after. He starts Oct. 1. Osanloo’s last day at P.F. Chang’s is Sept. 28.
“I’ll have one weekend off,” he said during a phone call late Monday.
As a Chicago native, taking the job at Portillo’s marks a return home for Osanloo. He was last in Chicago in 2014 when he worked for Kraft Foods Group.
He’s very familiar with the iconic hot dog chain. It was the first place he drove to when he got his license as a teenager.
During his visit to the Arizona Portillo’s, he realized that he would be leading a company that had a built-in fan base like In-N-Out, which is six times larger than Portillo’s, in terms of units.
“When you find a brand that has magic to it and nobody else can do what it does, those are rare,” said Osanloo.
When he returns to Chicago, Osanloo said he suspects P.F. Chang’s could announce a buyer.
In early July, the casual dining chain’s private-equity owner, Centerbridge Partners L.P., said it was exploring a sale of P.F. Chang’s after owning it for six years. Centerbridge took P.F. Chang's private in a $1 billion deal in July 2012.
Osanloo did not provide specifics about the intended buyer, only stating the the sale was progressing nicely.
“We’ve been making great progress there,” he said.
As for Portillo’s, he is careful not to make promises prior to taking over leadership of the brand, founded by Dick Portillo in 1963. In 2014, Berkshire Partners bought Portillo’s, ending an era of ownership by Dick Portillo. The founder is a consultant. He no longer owns a financial stake.
During his 3-year tenure, current CEO Keith Kinsey, who is retiring, opened about 19 units.
But most of Portillo’s expansion outside its core Illinois market has been limited to one or two locations. For example, in Southern California the brand operates only two stores, and they’re 50 miles apart. In 2016, Portillo’s opened two locations about 20 miles from each other in Florida.
When it comes to growth, Osanloo said he doesn’t know how aggressive he wants Portillo’s to be. He hinted that flooding the zone with locations in new markets might be a good pivot for the brand, instead one or two locations in distant markets.
“Onesie twosie, traditionally hasn’t worked well,” he said. “I am a big believer in what I call local scale.”
He said he has no plans to tweak the company’s menu, famous for its Chicago-style hot dogs, fresh burgers served with crinkle cut fries, and his favorite, the Italian beef sandwich smothered in peppers.
That kind of culinary charm, after all, is why Portillo’s is hard to replicate in the fast-food industry. It’s got the food quality of a fast casual brand, but the speed, price and convenience of fast food, he said.
“I don’t know many other brands like Portillo’s. There’s a magic to Portillo’s that’s very unique.”
Contact Nancy Luna at [email protected]
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