Bravo Brio Restaurant Group Inc. hopes that online ordering and delivery will help reverse years of sales declines at its two Italian concepts.
The company is rolling out third-party delivery through Grubhub this year, executives of the Columbus, Ohio-based owner of Bravo! Cucina Italiana and Brio Tuscan Grille said during a third-quarter earnings call Wednesday.
Bravo Brio is also partnering with the online ordering provider Olo to bring the delivery option to its own websites.
“We believe these options, when fully implemented, will have a meaningful and positive impact on our carryout business,” Bravo Brio CEO Brian O’Malley said during the call.
The news comes after a quarter in which Bravo Brio’s casual-dining brands continued to struggle. Same-store sales fell a combined 5.3 percent during the third quarter ended Sept. 25, solely on declining traffic. Same-store sales fell 8 percent at Bravo, and declined 3.7 percent at Brio Tuscan Grille.
Revenue fell 3.8 percent, to $94.6 million, from $98.3 million the previous year.
Bravo Brio recorded a net loss of $3 million, or 20 cents per share, from a profit of $910,000 or 6 cents per share a year ago.
O’Malley called the quarter “transitional,” and said the company is working to improve its performance both in generating sales and profits.
“While our financial performance is not where we would like it to be, we believe that the series of investments we have made will ultimately deliver growth in traffic and sales at both Bravo and Brio,” he said.
Both brands started offering new menus as a “first step” to rebuilding sales. O’Malley said the menu has boosted customer satisfaction scores, which he said will ultimately translate into improved sales and traffic.
But investors weren’t impressed. Bravo Brio stock fell nearly 3 percent Thursday, and is down more than 50 percent this year. Bravo Brio has lost two-thirds of its stock price value since May 2015.
Restaurant-level margins fell to 8.4 percent of sales in the quarter, from 13 percent the previous year.
Executives said the simultaneous rollouts of new menus at both brands, along with the scope of menu change, led to “larger than normal inefficiencies in our planned cost” during the period.
But O’Malley said the company improved efficiency in the quarter, even though it was “not discernable in the overall numbers.”
In addition to delivery, Bravo Brio has made deals with businesses to drive traffic on weeknights by generating more sales from business travelers. The company also hopes that gift cards will drive more traffic after the holidays.
Bravo Brio aims to generate more sales during the holiday season with the addition of private party rooms to its restaurants.
“As we enter the fourth quarter, we’re optimistic about our recent initiatives, as well as those that are in process today, and in the works going forward,” O’Malley said. “While the quarter-end numbers do not reflect our financial goals, we saw meaningful improvement, especially over the last month in cost of goods and labor.”
Contact Jonathan Maze at [email protected]
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