The COVID pandemic sent shockwaves through the restaurant industry back in March. Dining rooms shut down, sales plummeted, and restaurateurs moved quickly to pivot operations. Faced with these obstacles, several restaurants have risen to the challenge. The following 10 brands are navigating the pandemic with much success, whether it’s a rise in digital sales, menu innovation, or store development.
CEO Matt Friedman says that before COVID-19, it was difficult finding delivery drivers because of the demand from third-party companies and ride-share businesses. But the pandemic has opened up the labor pool in a significant way. To meet the demand for delivery, the company has added hundreds of jobs. He describes the training process as brief—drivers are getting on the road and making money quickly. The CEO says restaurants claim to be in the delivery business, but they’re really outsourcing. He adds, “I would say one of the most impactful things that has happened with us with COVID-19 is we control the experience. It appears to me that the consumer is trusting dealing with the brand directly rather than through a third-party.” The results speak for themselves. Same-store sales have spiked, to the point that Friedman describes the growth as “unprecedented and staggering.”
Edible Founder Tariq Farid wants to give other aspiring business owners an opportunity to join the Edible team even if they don’t have the financial means to do so, particularly during the COVID-19 pandemic. So the fresh fruit arrangement brand is launching a “Managed-To-Own” program in which candidates will pay a $30,000 initial fee and undergo an extensive, 90-day training program before taking over an Edible location. Between now and next year, Farid expects about 30 candidates to be in the program. The process, which he describes as selective, will focus on quality, not quantity. The new program comes as Edible continues a record-breaking year. The company announced that sales were up 18 percent for the first six months of 2020, with U.S. sales up 70 percent since April 1. Edible experienced its best April, May, and June in terms of sales.
Mighty Quinn’s adopted its delivery and takeout program more than three years ago in anticipation of franchising and the overall trends it saw in the industry. The proactive mindset proved crucial once the pandemic hit, especially considering eight of the brand’s 12 units are temporarily closed due to their location. To better execute the new style of operation, Mighty Quinn’s streamlined the menu by focusing on higher-selling items and reducing lower-selling ones to ensure everything is as fresh as possible. The chain started offering family meals and Cryovac sealed brisket and spare ribs—with reheating instructions—for customers who are concerned about employees handling food. CEO and co-founder Micha Magid says the pandemic will push the brand to rethink store layout going forward: “You just don’t need the number of seats anymore … We’ll be thinking about logistics of deliver couriers, the number of dining room seats that are actually needed to hit sales numbers.”
In June, BurgerFi and special purpose acquisition company OPES Acquisition announced the completion of a $100 million merger that will introduce the emerging fast-casual as a public company. Leveraging the merger, BurgerFi is accelerating its growth strategy. The company will open 59 units in 2021—30 corporate units and 29 franchises—boosting the company’s systemwide footprint to 189. BurgerFi expects annual sales to drop roughly $33 million to $112.5 million this year, but grow to $161 million in 2021. It also foresees adjusted EBITDA reaching $4.3 million in 2020 and increasing to $10.5 million in 2021. Major pillars of BurgerFi’s growth strategy include an emphasis on nontraditional locations and delivery-only business. BurgerFi signed a license agreement with REEF Technology in April, which led to the launch of BurgerFi’s first ghost kitchen on June 15 in Miami. REEF plans to open 25 BurgerFi ghost kitchens by the end of 2021, with new market expansion in Los Angeles, Seattle, Chicago, Houston, Nashville, and Minneapolis.
During the first 10 weeks of the year, same-store sales were up almost 8 percent. The bottom fell out in March, but the brand stabilized in April. Figures turned positive in subsequent weeks. Systemwide, A&W saw double-digit comp sales growth in May and June, even with nearly all dining rooms being closed due to COVID. Average unit sales have increased by 38 percent since franchisees acquired the company from YUM! Brands in 2011. CEO Kevin Bazner says franchise partners and operators deserve the most credit for how the brand has performed during COVID. Throughout the pandemic, A&W—which entered 2020 with 573 domestic locations (330 co-branded stores)—shared tools and practices to streamline carryout and drive-thru business. In the early stages, the brand hosted as many as three webinars per week. A&W is also expanding in markets of all sizes across the nation, including deals with 10 new franchisees.
The nearly 50-unit legacy chain, which once spread as wide as 650 locations in the late 1980s, spent the past year and a half appointing industry veterans, launching DoorDash, introducing a new store design, updating technology, and enhancing menu items. Then the pandemic swept across the U.S. in mid-March, and the company was down as much as 45 percent. But EVP Jeremy Biser says the foundational work completed by his team in the past 18 months proved critical, particularly improving speed of service and rolling out delivery. Since the low point of 45 percent, the brand has seen weekly sales increases. The brand is also returning to franchise recruiting, although Biser predicts a slow start: “But that’s going to give us a chance too to take care of some other things like getting more of our marketing materials put together and updating some of our technology systems even more.”
Within the first week of recognizing the pandemic’s impact, Slim Chickens put standard operating procedures in place to enact curbside service. The brand then pivoted its attention to drive-thru, ensuring throughput was effective. The chain’s proactive approach led to profitable results. Same-store sales are growing more than 20 percent on a rolling basis, and from a year-to-date perspective, comps are positive. Online ordering increased well over 300 percent, delivery bumped about 30 percent, albeit on a relatively small basis, and drive-thru leaped anywhere from 60 to 80 percent year-over-year. Before the pandemic, Slim Chickens planned to open more than 30 units in 2020. Those plans have been tweaked, but not significantly. The chain still expects more than 20 openings this year. None of the planned U.S. locations came off the board; some were just pushed back because certain states didn’t allow construction for a period. The brand has an overall goal to reach 600 units by 2025.
CEO Michael Haith says TMAD faced the same fears as everyone else. The restaurant furloughed staff, cut salaries, and saw unit construction come to a screeching halt. However, the tension proved to be brief. Pivoting strictly to off-premises played right into TMAD’s wheelhouse as 65 to 80 percent of sales came outside the four walls pre-COVID. The company received funding from the Paycheck Protection Program, hired everyone back and gave backpay. Shops under construction continued their progress and opened only about a month to a month and a half late. In addition, TMAD sales were up 16 percent year-over-year in June, and the loyalty program has added roughly 30,000 guests per month. Currently, TMAD has 77 units, and it’s projected to have roughly 100 by the end of 2020 or early 2021. Eight new shops opened since May, and 10 more are expected soon.
With dining rooms closed and unsure consumers, the brand took a five-week plunge in which comps dropped 15 percent. The company’s breakthrough came in the aftermath of the stimulus checks. After the five-week plummet, sales rose in consecutive weeks to the point where Golden Chick finished Q2 up 20.3 percent. In Q3 thus far, the brand is growing 22 percent and year-to-date, comps are increasing 16 percent. Development hasn’t missed a beat either. Since March, eight restaurants have opened, and another 18 are scheduled for the rest of 2020. That means Golden Chick will surpass 200 units before the end of the year. Forty-two units are in the pipeline for 2021. Golden Chick also found room for menu innovation. The brand joined the sandwich wars with its own Big & Golden Chicken Sandwich, which was rolled out systemwide at the end of May and is now mixing 9 percent.
In the fall, Blaze launched larger pizzas as part of an initiative to grow its digital delivery and carryout business, so pieces were already in place. During the pandemic, the fast casual onboarded Uber Eats—along with its existing partnerships with Postmates and DoorDash—and added contactless delivery. In addition, it introduced curbside carryout in about three weeks, which is now approaching 10 percent of sales. Digital is mixing 125 percent higher than it did pre-COVID. The Pasadena, California-based chain also created new family bundles and started a weekly Instagram program with chef Brad Kent, who showed viewers how to make pizzas with Blaze’s DIY pizza kits. Additionally, Blaze drew national media coverage with a one-day promotion of its White Claw pizza on June 18. The dough was made fresh in the restaurant, with flour, yeast, extra virgin olive oil, salt, a pinch of sugar, and Mango White Claw instead of filtered water.
Church’s was well-positioned from an asset standpoint to solve pandemic concerns. Digital ordering jumped 80 percent post COVID-19, with some units driving north of $7,000 in weekly sales through the channel alone. In June, Church’s pushed forward a pre-COVID-19 initiative it’s started to call the “multifaceted HR revolution" in which employees work on a new remote office schedule. Some don’t come into the office at all and others rotate three days a week. The “distributed workforce” policy split up on-site and remote days by team, “ensuring that all staff members who work together in the same functional areas are together in the office on the same days." The company also created a “Business Health & Safety Guidelines” course required for all employees, at all levels of the organization. Its “Team Church’s” intranet site archives content and keeps resources, like CDC guidelines and workplace practice policies, available to employees.