Industry News | September 5, 2008

Steak-Out Launches New Menu Item

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By now most company execs can counter concerns about nutritional values and commodities prices in their sleep—the two issues have become the go-to media topics of 2008. Steak-Out Char-Broiled Delivery, a 50-unit chain based out of Atlanta, decided to move from talk to action this week when it combated the top two industry woes with the debut of its Sirloin Cheesesteak Sandwich.

The company’s Director of R&D/Purchasing/Quality Assurance, Aftan Romanczak, says the chain’s newest permanent menu item was the result of rising ribeye prices and the strengthening of health trends among consumers. “One of our big items for the length of the concept has been the ribeye sandwich,” he says. “Ribeyes have gotten extremely expensive; today you’re looking at a product that can be anywhere from $6 to $8 a pound. It’s still a big seller, but we needed to look at something that was more long term, that wasn’t going to go away.”

Sirloin was the solution. At $4 to $5 a pound, Sirloin is much cheaper to supply than the brand’s traditional ribeye. In addition, franchisees are enthusiastically pushing the new lower -margin item because it has such a better food cost than existing Steak-Out offerings.

On the nutritional front, Romanczak says rolling out a sirloin sandwich gives customers a healthier, leaner meat as an alternative to the ribeye, which can be made up of nearly half fat.

But reacting to consumers’ health concerns takes more than hollow marketing, Romanczak warns. Instead, companies must extend their menus in a way that make sense for the brand’s image and for customers’ waistlines. “You have to be careful how you adapt health trends to your menu,” he says. “I don’t think you can just say ‘Weight Watchers’ or ‘healthy’ on the menu. People are more sophisticated.”

While the coming of the Sirloin Cheesesteak Sandwich seems to be addressing the brand’s most pressing problems, the rollout was not effortless. Romanczak says that all the grills in the system had to be measured and a custom grill grate was made in order to be able to serve the new sandwich.

The work seems to have paid off. Romanczak says with the new grates, the brand can begin explore even more sandwich options like chicken cheesesteaks.

Steak-Out tested the Sirloin Cheesesteak Sandwich for six week at several locations in the system before rolling it out to all the units. At a suggested price of $7.99, the sandwich has already become the second most popular menu item for the brand. This is the first menu innovation for Steak-Out in two years.

--Blair Chancey