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This is part of Nation’s Restaurant News’ annual Second 100 report, a proprietary census ranking restaurant brands Nos. 101-200 by U.S. systemwide sales and other data. This special report focuses on a smaller, more growth-oriented universe than the Top 100 report.
July 29, 2014
Portillo’s Hot Dogs led the LSR/Specialty group in estimated sales per unit.
Of the seven restaurants ranked in the Second 100’s LSR/ Specialty group, Portillo’s Hot Dogs continues to prove that strong sales can come from a limited number of units.
The 51-year-old Chicago-based sandwich and hot dog chain posted category-leading estimated sales per unit, or ESPU, of $7 million, with $255 million in systemwide sales for the Latest Year — a 13.3-percent increase compared with the Preceding Year. The independently owned chain’s performance even caught the attention of Berkshire Partners, a $4.5 billion investment fund that earlier this month agreed to buy a stake in Portillo’s for a reported $1 billion. Those funds will be used to open new units across the country and reduce leadership duties for chain founder Dick Portillo.
Dallas-based Dickey’s Barbecue Pit continued its smoking-hot expansion run in the Latest Year, adding an estimated net 113 units on top of a net 68 restaurants opened in the Preceding Year. After finishing the Preceding Year with 383 restaurants, Dickey’s ended its Latest Year in May with an estimated 416 locations, as part of its plan to open 130 more stores in 2014.
The chain’s Latest-Year sales grew accordingly, surging 32.4 percent to $343 million, lapping 57-percent growth in the Preceding Year, when sales hit $259 million.
• Second 100 Rankings and Results
The situation at mall pizza chain pioneer Sbarro, the Italian Eatery was less sunny in the Latest Year, when ESPU fell 4.4 percent to $636,300, the lowest in the segment. Though Sbarro remained the segment systemwide sales leader with $370 million, that was down 7.5 percent from $400 million in the Preceding Year.
Chief executive David Karam said he believed the development of Sbarro’s fast-casual pizza concept, Pizza Cucinova, would help future sales, as would the acceleration of international unit openings. Karam also announced the creation of a new in-line concept called Sbarro Brooklyn Fresh. Those goals, however, took a backseat to the chain’s bankruptcy declaration in May — an event preceded by the February closure of 155 North American restaurants.
The chain announced it will relocate its headquarters from Melville, N.Y., to Columbus, Ohio, where Karam lives and operates one of Wendy’s largest franchise groups. Columbus also is home to the company’s two Cucinova units.
Struggles at Lexington, Ky.-based Fazoli’s also continued, as the chain dealt with losses in unit count and sales. Latest-Year ESPU declined 5.4 percent after improving nearly 11 percent in 2012. A systemwide sales loss of 6.4 percent to $210.5 million — down from $225 million in the Preceding Year — likely was tied to the closure of three units in the Latest Year, leaving the company with 213 locations.
Fazoli’s CEO Carl Howard told Nation’s Restaurant News in November that the chain had agreements to open nine new locations in Ohio, Indiana, Colorado, Iowa and Texas in 2014. He also said the chain was working to simplify its menu, menu boards and kitchen equipment package to make the brand “easier for consumers to understand and for our employees to operate.”
In March Fazoli’s debuted fast-casual concept Venti Tre Modern Italian in Baltimore. It’s planning to open two more units of the brand in the area this year.
“We’re very optimistic it will perform at the average unit volume of a fast- casual restaurant or higher,” Howard said.
Pei Wei Asian Diner saw its ESPU continue a two-year decline, ending the Latest Year at $1.7 million — down more than $100,000 from the Prior Year. However, its 7.6-percent unit growth from a net 14 new stores helped the Scottsdale, Ariz.-based chain’s systemwide sales rise 4.9 percent to $332.6 million.
Proving along with Portillo’s that hot dogs remain popular with Americans, 323-unit Wienerschnitzel’s EPSU rose 3 percent and contributed to a 1.3-percent increase in systemwide sales to $223.7 million. The Newport Beach, Calif., chain’s positive Latest-Year performance came despite the closure of one unit.
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