Modern Market Eyes Expansion of its Health-Conscious Identity

Modern Market Eatery believes it has just tapped the surface of its potential as a fast-casual, health-conscious brand.

The nearly 30-unit chain thrived in the difficult environment of 2020, and its sales continue to surpass expectations month-over-month. Same-store sales increased 25 percent in the first half of the year, with off-premises sales up more than 80 percent and on-premise sales soon to reach 2019 levels.

The jumping sales were driven in part by lessened competition as so many restaurants shuttered in the wake of the pandemic, co-founder and CEO Rob McColgan says. According to Datassential, more than 10 percent of restaurants in the U.S. closed permanently since the pandemic began in March 2020.

In its path ahead, Modern Market hopes to attract experienced restaurant operators to bring franchises to life, adding to its footprint spanning Colorado, Texas, Arizona, and Indiana. It took until the year before COVID-19 to know Modern Market was ready to scale.

“Franchising was always going to be a critical part of our growth strategy,” McColgan says. “We knew that it would from the beginning, but we also knew that there was a lot of work we had to do to be ready to do it the right way.”

Nontraditional spaces are a key element of Modern Market’s expansion strategy, based on the success of locations at Notre Dame University’s Student Center and Denver International Airport.

Airports often lack healthy food options, making this a key market to break into, McColgan notes. Targeting college campuses is purposeful, too, as the CEO believes better-for-you food resonates with the younger generation.

“Through it all, it's how do we continue to evolve and get better?” McColgan says. “What can we do from a menu, a store design, to continue to improve? One thing that we're extremely proud of over the years is, we've never stopped improving and getting better, whether that's adding new technology, new ways to market ourselves. We're always exploring ways to increase those top line sales, to increase awareness in the brand, and get the food into as many mouths as possible.”

Modern Market’s latest prototype store model opened last year, and this is the next-generation prototype that will expand into both the company-owned and franchise units to come. The redesign increases efficiency, producing higher quantities of food than McColgan once believed possible, and opens the door for drive-thru opportunities.

It’s vital that Modern Market does not focus on growth in one key regional area, but instead expands all across the country, according to McColgan. That’s why after Denver, Texas was Modern Market’s second market, enabling the brand to prove the concept works in multiple areas of the country—not just metropolitan areas known for health-conscious consumers.

“We believe if you can work in Colorado, Texas, Arizona, Indiana, then there's no reason why you can't work anywhere,” McColgan says.

Modern Market

Modern Market presents itself as the franchise opportunity in the better-for-you market, and one of a handful of health-conscious franchises in the fast-casual space.

McColgan says having quality, clean ingredients, and a broad menu differentiates the brand, and it’s part of a new concept of modern fast food.

With the advent of delivery, he says the modern interpretation of fast food is being able to get your food however you want, whether picked up, delivered, or catered. Modern Market’s food, incorporating favorite offerings like the Lemongrass Tuna Bowl, Smoky Chicken Bowl, and the Salmon Caesar, travels well with a menu that appeals to everybody, McColgan says.

“We wanted to eliminate the veto vote,” McColgan says. For families or groups, there’s something for everyone: salads, pizzas, bowls, and sandwiches.

Modern Market launched a virtual pizza concept at the end of 2020 called Honest Pizza Company. Currently operating in 15 percent of restaurants, this works as an additional revenue stream utilizing existing kitchen infrastructure. It will be available at all locations by the end of the year.

Health-conscious brands often trended higher during the pandemic, which reminded consumers of the importance of their own health, McColgan says. While he attributes the increased popularity of health food trends partly to COVID-19, McColgan believes the pandemic merely accelerated what a lot of people were already thinking and brought the already present better-for-you food wave to prominence. What originally looked like a roadblock turned out to be traction for Modern Market.

Navigating the initial weeks of COVID-19 was critical, but because of a prior investment in technology and delivery, Modern Market bounced back. Long before anyone mentioned “Corona” without referring to the beer, Modern Market revitalized its website and ordering app and ensured third-party delivery and the ordering experience was as seamless as possible. After COVID-19, delivery and curbside pickup took off.

“People being forced to stay at home and understand that health is probably the most important thing for a lot of people, I think it's just accelerated the understanding that what you put in your bodies is important,” McColgan says.