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    5 Tips for Growing a New Concept in a Competitive Market

  • The partners behind a growing seafood fast casual share how they came together as a team and achieved sustained and effective growth.

    Brown Bag Seafood
    Brown Bag partners Zach Flanzman and Donna Lee have established a loyal customer base in Chicago.

    Donna Lee went through a multi-year process before she opened the first Brown Bag Seafood Company restaurant in Chicago in 2014. The founder and CEO originally got hooked on foodservice at 16 years old and held various roles throughout the industry.

    Lee eventually became a general manager for a Noodles & Co. restaurant, all the while searching for the right spot to open her own concept. She finally found one nearChicago’s Millennium Park and fulfilled her goal of being the operator when she opened the first Brown Bag.

    Zach Flanzman, who was in the consulting field before breaking into foodservice, had been a loyal Brown Bag customer. He saw a restaurant he liked and believed he had something to offer, and eventually became the brand’s chief strategy officer.

    In a recent episode of QSR’s podcast “Fast Forward,” Lee and Flanzman discussed the process that got them to six locations throughout Chicago and their tips for thriving in a competitive fast-casual market.

     

    1. Have patience and be thoughtful

    Lee says she got frustrated with Chicago real estate and didn’t settle on her first location for about a year. She says she was very dedicated to opening a restaurant in the Loop, Chicago’s core downtown area. She found a property, rejected it the first time, but eventually circled back. Her patience paid off, as the first Brown Bag location proved massively successful.

    She says the real estate issue was just the first of multiple obstacles she had to overcome to get started.

    “You’re thinking about all of these things and you’re trying to figure out how to think about scaling what you do. I don’t even mean scaling into multiple units. I mean, ‘Well great, I can panko crust fish and shrimp. That’s great, but how do I do that in volumes?’” she says. “There was a lot of thought that had to go through that. There’s a lot to do at the same time.”

     

    2. Understand your working relationships

    When Lee opened the second location in Revival Food Hall in Chicago, she had to come to grips with the fact that hers was not the last word when it came to much of the operation Rather, the property managers had control over so much of what Brown Bag could do.

    “In so many environments, even when it is standalone restaurants, you still answer to landlords. You still answer to management companies of buildings,” she says.

    She says that, with Revival, her restaurant had to answer to and follow the guidelines and preferences of the food-hall operators. If they say stay open until 10 p.m., she says, the restaurant stays open until 10 p.m.

    “You have to be a little more aware of all of the considerations of every vendor of the hall and think about decisions more communally,” she says.

     

    3. Be conscious of your strengths and weaknesses, and know when to accept help

    Flanzman met with Lee in January 2017 after sending an email to the company’s general inbox. Lee says she wanted to meet the man behind the email and see what he had to offer.

    Flanzman came prepared to the meeting with detailed thoughts on the company and what he wanted to accomplish, leading Lee to say she saw him as one of the most prepared, precise people that she had ever met.

    “It wasn’t just polished, but it was also so cool to see someone who was thinking about all the things that you’re struggling with,” she says.

    She adds that Flanzman knew what the company needed and was ready and willing to tackle it.

    “Maybe he could just have looked at me and guessed that I wasn’t very good at all that stuff,” she says. “But he does really take on all the things I’m not very good at.”

    Flanzman says his role as chief strategy officer allows him to see that vision that the company has and fill in where the company needs him.

    “My job just has become, over time, all the things that Donna herself is not as able to check off,” he says. “Just like she took the concept from founding to where it was with all of the things that I couldn’t have done.”

    He says the two of them wear a lot of different hats throughout the business day, but that allows them to support each other and the business.

    “I think that in large part, what we both are to each other is just another voice in the room who is fully up to speed on everything,” he says. “We can bounce ideas off of each other and make better decisions as a result of that.”

     

    4. Know your market and your demographics

    Lee says  Chicagoans are loyal to local businesses, but there isn’t always going to be the research done to find out who is local and who isn’t before entering the restaurant. She says that, in building a loyal customer base, the Brown Bag concept spoke for itself with fresh, quick, high-quality seafood products.

    She says her first restaurant’s location was key in serving the market successfully.

    “We has real estate where it’s a little bit of a food desert over there. Maggie Daley Park hadn’t been developed yet and the people who are in these very dense office buildings didn’t have all that many options,” she says. “If they did, they were kind of tired.”

    Lee says she didn’t feel an extreme sense of competition in that small area at the time, but she felt a strong sense of competition in how to be relevant as a concept next to other fast-casual restaurants and the national players.

    She says the driving force behind the concept was that tBrown Bag offers food she likes to eat, but she couldn’t find it anywhere. And while Chicago might be a more meat-and-potatoes type of city with a large consideration for value, other customer subsets weren’t finding their needs met.

    “There are quite a number of people who have become more health-conscious and more concerned with what they’re putting in their body over time,” she says. “When you confine those areas of the city where you have clusters of people who behave that way, it can be really a great marriage.”

     

    5. Be conscious of what kind of growth you want or need

    Flanzman says that Brown Bag is at a fun point in its growth model where its patient approach to expansion is paying off, even as the team looks to accelerate that growth.

    “Where we're coming from is very much a one-store-per-year, sustainable, calm, patient type of growth model,” he says. “And so I think that in my day-to-day I’m thinking about how to get to that accelerating part of the curve and what that means from the standpoint of real estate strategy and funding strategy and making choices about effective growth and pace versus patience.”

    He says one thing that keeps him up at night is the hard choices he has to make about locations and costs, where one bad move can have a significant impact on the business.

    “It’s these decisions that are the fun ones, and I think if we make them right, and we think about them all the time together, that will get us where we’re trying to go,” he says. “The smaller you are, the more you want to be careful about those decisions."