Emerging Concepts | December 2013 | By Judy Kneiszel

Ones to Watch: Teddy’s Bigger Burgers

Hawaii-based burger joint brings made-to-order creations to the mainland.

Quick serve concept Teddy's Bigger Burgers serves up premium burgers in Hawaii.
Teddy’s bigger burgers
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Most U.S. mainland residents have never been to a Teddy’s Bigger Burgers; those who have probably visited while on vacation. But that may soon change, as the Hawaii-based burger joint now has two mainland units and is poised for additional growth.

After the first Teddy’s opened in Honolulu in 1998, the brand grew slowly, adding two more stores in Hawaii by the end of 2003. Teddy’s started franchising in 2005 and now has five franchised stores—two in Hawaii and one each in Washington State, Iowa, and Japan.

“We’ve only got one shot to do this,” says Ted Tsakiris, cofounder and co-CEO of Teddy’s Bigger Burgers. “We didn’t want to grow too fast and not be able to handle the expansion. We had to get our operating procedures down, and we needed to be prepared for growth. We want to make each franchisee happy, and the way to do that is to build the brand slowly and surely. I would rather have 200 super happy franchisees than 2,000 who are constantly requiring attention because we’re not servicing them right. That’s why it took so long.”

Tsakiris says Teddy’s brought something new to Hawaii when the first location opened. “We opened before the gourmet burger segment took hold in Hawaii,” he says. “We really pioneered it.”

Teddy's Bigger Burgers

Founders & CEOs Ted Tsakiris and Rich Stula

HQ: Honolulu, Hawaii

Year Started: 1998

Annual Sales: $1.6 million per location

Total Units: 12

Franchise units: 5

www.teddysbiggerburgers.com

While the business might have been cutting edge as far as burgers go, Teddy’s does things the old-school way. “We cook everything to order, using fresh, hand-pattied ground chuck with nothing added,” Tsakiris says.

Teddy’s burgers are served on a potato bun and are topped with claussen pickle slices and a proprietary sauce that, Tsakiris says, “isn’t Thousand Island dressing like so many other secret sauces.”

The menu also features Extra Thick Shakes made with five scoops of full-fat ice cream for $5.49. Side choices include french fries, tots, and beer-battered onion rings. Tsakiris says the menu was mainly focused on beef burgers in the beginning, but now includes a turkey burger, grilled or crispy chicken, veggie burger, fish sandwich, and pastrami sandwich, as well as a create-your-own salad option and a Caesar salad.

“The menu has grown only when quality items presented themselves,” Tsakiris says. “We’ve always made decisions about Teddy’s from our bellies. I’ve always asked myself, ‘If I had a favorite burger place, what would it be like?’”

That burger place would apparently be bright, with tables and chairs in bold primary colors, black-and-white-tiled walls, and a 1950s theme. No matter what the store looks like, though, operating a restaurant in Hawaii is difficult, Tsakiris says.

“The cost of doing business here is challenging,” he says. “But if you are good, you are busy.”

He says that as the concept grew and buying power increased, Teddy’s looked to its suppliers for better pricing rather than raising prices or changing ingredients.

“In the beginning, we were not making any money,” Tsakiris says. “We made the slimmest margin out of the gate in order to show people what a good burger was and to change the game. I said we’d make it off of our volume some day. You couldn’t operate a one-off Teddy’s and be at our price point.”

The average per-person ticket for Teddy’s Bigger Burgers is $9–$10 at all units.

“There’s barely a price difference,” Tsakiris says. “We are so aggressive in Hawaii and have so much buying power, we are able to keep prices down. If we had 200 stores on the mainland, it would be cheaper, and it will be as we grow. But as it stands right now, we’re able to be about the same price as in Hawaii.”

The best-seller at Teddy’s is the No. 2 Big Combo, which includes a 7-ounce Original Bigger Burger, french fries, and a drink. It’s priced at $9.99. All burgers come with Super Sauce, lettuce, tomatoes, onions, and pickles, unless otherwise requested. And requests are not a problem, as Teddy’s offers a list of additional toppings—from common choices like cheese and grilled onions to uncommon picks like peanut butter, pastrami, and jalapeños. Being a Hawaiian concept, Teddy’s also offers grilled pineapple as an additional topping and includes it on at least one of the specialty burgers. The specialty burger menu includes seven original creations, and one specialty burger or sometimes a new creation is featured each month as the Burger of the Month.

Teddy’s did a one-year experiment with an express model, in which it pared down the menu and had the timing down to three minutes. The express model closed when the lease on its downtown Honolulu real estate ran out, but Tsakiris says it worked well and is ready to roll out again in the future.

The prototype for a standard Teddy’s Bigger Burgers unit averages 1,800–2,000 square feet on the mainland, but is slightly smaller in Hawaii, where outdoor seating can be used year-round.

“We need a larger under-roof area in most of the mainland, but we don’t want to build big Taj Mahal restaurants,” Tsakiris says. “We want to keep costs minimal. The leaner the better.”