Concept restaurants of the future?

Restaurant chains are realizing they can’t test-drive the future in vehicles conceived for the past. No wonder a growing number are opening specialized formats that leapfrog over the limitations of current designs, if not their very names and characters. They’re the restaurant equivalent of the auto industry’s concept cars.

California Tortilla was the most recent chain to take that route, announcing plans to open two scaled-down R&D units bearing the name Burrito Elito, which is also the name of the chain’s frequent-guest program. Both will be located in airports, which facilitate test marketing because they host such a broad swath of the consuming public.

BJ’s Restaurants has already generated four months’ worth of results for its R&D vehicle, a single outlet in southern California called BJ’s Grill. The concept suggests that BJ’s core brand may be looking for some tonier design accents, with features like booth seating and less of a sports-bar feel.

P.F. Chang’s has opened its lab in the same region where BJ’s has fired up its Grill. The Asian concept apparently wants to Americanize its appeal a bit; the test site drops the words “China Bistro” from its mother concept’s name, and features such decidedly American specialties as roast chicken with shoestring fries, and Alaskan black cod.

“The new Irvine P.F. Chang’s represents all that we’ve learned in 18 years, and what we hope to become over the next five to ten years,” said Chang’s president Lane Cardwell said at the time.

Those three chains follow the earlier lead of Burger King, whose Whopper Bar is serving as a testing ground for such new menu options as a shareable Whopper.

The parent of the Houston’s dinnerhouse chain also moved in that direction with the opening of the R+D Kitchen several years ago. The crucible for new ideas provided popular enough for the company, Hillstone Restaurants, to open two more.

It remains to be seen if the experiment becomes the expansion vehicle for some of the other concepts looking to do a little time-travel with their brands.

'Next Stop: Last Century'

Restaurateurs must’ve had their hearts broken this holiday season. All they found under the wrapping paper were iPads, flat screen TVs and the latest smart phones. What they really wanted, judging from recent news stories, was a time machine.

Not just any decades-jumper, but one that can take them back as well as forward, to the days when counter servers wore peaked paper caps. They want to capture the magic that made Hot Shoppes and A&W the dominant chains of their day. Why else would they be opening a new chapter for the brands?

In case you missed the particulars, Marriott Corp. is planning to open a Hot Shoppe in a Washington, D.C., hotel in early 2014. If you’re not familiar with the concept, it was a cross between a soda fountain, family restaurant and fast-food joint, serving up shakes, fries and burgers to the generation that’d parent the Baby Boomers.

It was also the foundation for the Marriott hospitality empire, which was originally known as Hot Shoppes, Inc. Founder J.Willard Marriott started in business as a restaurateur, first as an A&W franchisee (more on that in a minute), then as the builder of the Hot Shoppes chain (beginning in the late 1920s), and then as architect of the Big Boy system, which operated under a slew of regionalized names (Shoney’s, Frisch’s, JB’s, Abdow’s, Azar’s, etc.) Hotels would come later, largely under the tutelage of Willard’s son Bill, who’s about to retire.

Hot Shoppes gave more than the Marriotts a taste of the good life. At a time when full-service restaurants were largely upscale joints, it provided a way for workers and the lower middle class to have someone wait on them. My mother often recounted how she’d occasionally get a milk shake at a Hot Shoppe when she was studying to be a nurse in Washington, D.C., during World War II. She’d say it with the wistfulness of someone who’d just had tea with the Queen.

Hot Shoppes would plug along as a curiosity, a bit of nostalgia making too many concessions to the times, until 1999. Marriott has apparently decided that a 25-year gap without a Shoppes is too long.

Maybe it’s just a coincidence that a new chapter also opened this week for the brand that preceded Hot Shoppes in Marriott’s business model (the first store was converted from Willard Marriott’s A&W franchised unit). A&W has been quietly plugging along, gaining and losing stores, for eons. For a long while it shared resources with the likes of Taco Bell, KFC and Pizza Hut, serving as a co-branding partner for those sister Yum! Brands holdings.

But now A&W is on its own again. The brand was spun off to franchisees right before Christmas. They’ve vowed to grow the business, in part by taking advantage of A&W’s heritage. No doubt they’re looking to cruise back to happier days and bring that popularity back to the current day.

But that’s not the only time travel the industry is pursuing. As Restaurant Reality Check reported earlier, P.F. Chang’s hopes to get a glimpse of its future via a new one-of-a-kind bistro in southern California. The restaurant is intended to serve as a lab for how future stores will operate, right down to their menus and serving style (i.e., a heavy reliance on small plates).

Chang’s isn’t the only chain that’s asking itself, How can we anticipate what’s next for the brand if our test site is a facility built for today?

As some of Yelp’s citizen-reviewers have noted, BJ’s Restaurants has opened a downscale version of its signature concept, called BJ’s Grill. Management has stressed that the smaller riff is meant to be a testing ground for such futuristic touches as new technology, not a prototype.

Indeed, some of the features under scrutiny seem far afield from the current-day BJ’s. Yelp posters noted that the menu has a decidedly Mediterranean bent, with kabobs and hummus on the bill of fare.

The idea of building a futuristic unit is hardly new. Houston’s, the upscale chain whose restaurants sometimes operate under the Hillstone name, also runs an outlet called R&D Kitchen. As the name implies, the restaurant is a little more on the edge than a Houston’s.

Apparently it’s already given the time machine a try.

Get the petition started

This is an open plea to Jerry Deitchle from the attendees of the People Report Best Practices Conference: Please, do a book.

Write down all the pearls you shared today about your role as CEO of BJ’s Restaurants. Give us a single handy resource for your folksy expressions, which pack an intelligence that'd prompt any self-respecting consultant to double his rates. We particularly loved how you characterized your current role at one of the industry’s best-performing brands, and how it differs from your prior responsibilities as a CFO:

--You’re no longer a profit optimizer, now you’re a sales driver, instilling that sales-building mindset into the organization’s very DNA.

--You’re no longer the caddy, now you’re the golfer, “the one who actually has to drive the ball,” as you put it.

--You’re a stagecoach driver who’s leading—not driving—a team of really good horses, i.e., your staff.

--“I’m a recovering accountant.”

--Your LinkedIn bio lists your title as Chief Dishwasher.

Some of us might’ve been skeptical about the humility that was ascribed to you by our conference hostess, Joni Doolin. She recounted how you responded when she decided to present you with a People Report award: “What, have you run out of people to give it to?”

But you convinced us with the things you said, like being uncomfortable with having your picture in the program guide alongside the luminaries who’ve previously won the Legacy Award (Doug Brooks, Joe Lee, Lou Kaucic, Phil Hickey.) “Maybe you can put the BJ’s logo in place of my picture in next year’s listing,” you suggested. And we don't think you were kidding.

Finally, we want to hear more advice like the nugget you offered at the close your presentation, which was basically an explanation of how you came to appreciate human resources specialists after initially failing to understand their value. That was a dicey admission to make to an audience of HR specialists.

But you redeemed yourself with your tip: “Never take that first no from your CEO as the final no.” If there’s an HR initiative that’s stoked your passion, come back at him or her, using data—“Always use data; drive data points whenever you can,” because that’s what’ll get to them.

So, Jerry, let’s get to it. Fire up the keyboard and give us some more of your thinking.

But can she leap a tall building?

It’s a good thing slime-dripping mutants from outer space haven’t attacked the restaurant industry in the last few weeks. Mustering a squad of superhero defenders would’ve been tougher than getting Alice Waters to wolf down a bag of Cool Ranch Doritos. A character named Price Slasher just wouldn’t fit an X-men team, even if any number of chain execs could have applied.

Then again, there is a new Clark Kent on the scene. Few have even noticed her, much less realized she can hold her own with the likes of Sally Smith of Buffalo Wild Wings, Jerry Deitchle of BJ’s Restaurants, and the industry’s own Dynamic Duo, Jim Skinner and Don Thompson of McDonald’s.

Gotham had certainly run amuck before Cheryl Bachelder, a one-time president of KFC, was hired in late 2007 to right AFC Enterprises and its fast-food business, the Popeyes fried-chicken chain.

Popeyes was KFC’s closest competitor, but a decidedly distant one. The brand had gone through more redirection in the prior years than a GPS provides in a decade. Under a succession of leaders, the concept had experimented with name variations, different formats, upscale recastings, and dramatic menu changes. They seemed intent on nudging the brand out of its quick-service niche.

Meanwhile, the core business stagnated. Units looked rundown and were often poorly located. Franchisees let their operations languish as headquarters cycled through more change.

Enter the caped Bachelder, promising yet more change, but talking dollars and cents this time. She explained that the 1,900-unit chain would spend $3.5 million to revamp its menu and marketing, and another $2.5 million to recruit better talent and improve service.

Then she changed the concept’s name from Popeyes Chicken & Biscuits to Popeyes Louisiana Kitchen. The bone-in fried chicken was itself renamed Popeyes Bonafide Chicken, and new premium products like a bowl meal and sandwiches were added. Simultaneously, Bachelder said the chain would tweak its menu to provide more portability and value.

It sounded like the same-old same ole—an attempt to be more upscale, without giving up the customers who just wanted inexpensive fried chicken. Similar past efforts had failed to pull Popeyes out of a Louisiana-grade swamp.

But Bachelder aired a sweeping plan to investors and staff. She cited lofty goals like improving the image of the brand, yet also mentioned minor tweaks like outfitting employees at the drive-thru station with headphones and timers. She later explained that handling three more cars an hour during Popeyes’ busiest drive-thru times would bump up comp sales by a full percentage point.

Marketing would be stepped up, as would deal making. The chain would emphasize portability, value, its Louisiana heritage, and on-the-bone fried chicken.

The strategy was notable for its detail and extensiveness, but not necessarily its approach.

Now, about a year into it, the plan is showing undeniable signs of success. Popeyes’ domestic comp-store sales for the second quarter hit 4.3%, outstripping the whole fast-food market by five percentage points, according to Bachelder.

A one-day discount—eight pieces of chicken offered for $4.99—had delivered “one of the best Wednesdays in our recorded history,” she told investors.

Bachelder also revealed that the chain would close as many as 120 underperforming restaurants.

Her moves were bold, but her predecessors at Popeyes hadn’t lacked gumption, either. What does seem different is how well-conceived her plan is, and how attuned it is to both the strengths and weaknesses of the brand.

Every turnaround amounts to building off a concept’s strengths with reasonable business-building measures. The artform is accurately identifying those strengths and astutely deciding what advances would complement that base.

It’s a superpower that Bachelder appears to have mastered, at least this far into the fight to save the world.

At a time of menu makeovers, BJ's resets the bar

It looks as if restaurant chains have been pumping espresso into their menu development staffs again. A current project requires me to study recent changes in the bills of fare for several dozen major concepts, and the turnover is astounding. An OSHA crackdown may be in the offing, because some test-kitchen crews are clearly being worked 'round the clock.

Next month could bring a new standard to beat. Yesterday the CEO of BJ’s Restaurants ticked off the changes that’ll be evident in the casual chain’s May menu—as “many as 25 to 27,” said Jerry Deitchle.

Included, he said, will be “10 to 12 new bar drink recipes,” an effort that complements BJ’s ongoing efforts to add more craft beers, upgrade its wine selection, and adopt a “more contemporary” non-alcoholic beverage program.

Other changes include the addition of two new full-size pizzas, a flatbread appetizer pizza, an “absolutely terrific” Thai shrimp lettuce wrap, a new version of Texas-style chicken-fried steak, an updated pot roast, a revamped an renamed Italian chopped salad, and new presentations of its crispy potato skins and meatloaf.

The overhaul was based on a what officials described as a gap analysis of what competitors didn’t offer.

“We didn’t look and say, gee, we need to have a $5.95 lunch bowl or some $5.95 lunch item or a $9 item that we could bring in there,” CFO Greg Levin told analysts during the conference call. It's not "a value perspective that maybe you’re seeing from of [our] peers."

Meanwhile, a store in Austin is testing BJ’s gamble that it can become “the premiere retailer of craft beer in casual dining,” in Deitchle’s words. He explained that BJ’s proprietary brews are “surrounded” by 24 craft beers on tap. The set-up increased the likelihood that patrons would order beer, and boosted the overall average check, he disclosed.

The extended array has already been rolled into at least 20 more stores, Deitchle indicated. “We’re still learning a bit from it,” he said, but “every economic and consumer indication has been very, very positive.”

At the same time, just to keep corporate chef Ray Martin busy, BJ’s is working on a new kids’ menu.

Deitchle mentioned that Martin would be rewarded for his work with a free nine-month cruise around the world. Actually, he didn’t say that, but I figured I’d plant the idea. I feel for you, Ray.

BJ's focuses on operations, including the bar

BJ's, one of casual dining's stronger performers, hopes to add sales momentum during the current downturn through a series of operational and menu tweaks. Those initiatives, detailed to investors this week, include a new high-speed, energy-saving pizza oven, as well as a new centralized reservation system for large parties.

The chain is also testing catering and new dining-room configurations that aim to maximize seating capacity.

On the menu side, BJ's is experimenting with a new roster of craft beers, a new children's menu, higher quality wines, non-alcoholic beverages and "new signature menu items," said CEO Jerry Deitchle. He did not provide details.