Fast Casual | August 2017 | By Sam Oches

Why Buffalo Wild Wings Got Back in the Quick-Service Game

Buffalo Wild Wings doubled down on full service about 15 years ago, but is ready to test the quick-service market once again.
B-Dubs Express scales back the Buffalo Wild Wings model to 2,500 square feet, with seating for 35–40. Buffalo Wild Wings
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Several casual-dining brands have recently recognized the potential in counter-service spin-off concepts.

From Hooters to Cracker Barrel and from Hurricane Grill to The Cheesecake Factory, full-service brands are rolling out limited-service prototypes in hopes of drawing a younger, more transient customer base.

Only one of them, though, already knows what it’s getting into with the quick-service world: Buffalo Wild Wings.

The Minneapolis-based chain with more than 1,200 locations around the country announced that it would be rolling out a quick-service prototype called B-Dubs Express—roughly 15 years after the brand shifted its strategy away from counter service and focused firmly on a full-service, sports-bar model.

“We’ve recognized that there are certain areas that we have looked to develop that just could not support a full-size Buffalo Wild Wings,” says Todd Kronebusch, vice president of market development for Buffalo Wild Wings, noting that smaller markets in particular are ripe for a scaled-back, quick-service model. “There is a consumer that just wants that great Buffalo Wild Wings occasion, and then there are people who just want to be able to go in and out of the restaurant, grab food, and go.”

B-Dubs Express, which will initially open this year in the Minneapolis suburbs of Edina and Hopkins, Minnesota, scales the Buffalo Wild Wings footprint down to about 2,500 square feet and provides 35–40 seats in the dining room. Traditional locations are between 4,000 and 7,000 square feet and provide 200 seats or more.

In addition, the menu will be pared down to include chicken wings and tenders, as well as a chicken sandwich, burger, salad, Buffalo Mac ‘n’ Cheese, and some shareable items and sides. 

The goal, Kronebusch says, is to create a more convenient Buffalo Wild Wings experience for today’s customer who is looking for a “different value proposition,” particularly when it comes to accessing high-quality food quickly. Takeout will be more important, and the company is even partnering with DoorDash to provide a delivery platform.

“I think what we realized is that as consumer trends and behaviors are starting to change, the demand for our product, our great food and wings and beverage, is still as strong as ever,” he says. “So we started having conversations around, if we designed something that allowed us to put a really small footprint that just focused on the top 20 percent core items, and focused on an ease of convenience factor and value-driven factor, could we model something that could go into densely populated areas, and start back-filling some of these trade areas?”

The introduction of a quick-service prototype may seem out of place to some full-service concepts, but it’s firmly in Buffalo Wild Wings’ wheelhouse.

That’s because the company, which was founded in 1982 and began franchising in 1990, originally launched as a “quick-casual” restaurant where customers ordered at a counter and had their food delivered to their table.

In 2002, the company shifted its focus to the full-service sports-bar concept, which Kronebusch says helped Buffalo Wild Wings accelerate unit growth and average unit volume.

“I think at the time, [the quick-service model] was confusing to the guests, because you ordered at a counter and then you sat down at a table, and you had a server who came by and you could reorder food or get your beverage orders,” he says. “As we went out and expanded into new markets, we quickly realized that people had a hard time understanding the service model.” However, with today’s popularity of fast casual, guests are far more comfortable with that type of service, he adds.

As for the name, “B-Dubs” has been a common nickname among Buffalo Wild Wings fans, something that happened organically; in fact, for a long time, the company discouraged any official use of the moniker.

But Kronebusch says the company has come around on the nickname, and when it spoke with loyal customers during focus groups about the quick-service prototype, “B-Dubs Express” resonated the most as a name.

“We were trying to become a grown-up restaurant chain at the time, and I think what we found is that it was so important for our guests to be able to have it B-Dubs, that we eventually said, you know what, this is pretty awesome,” he says. “When you have somebody with so much passion behind your brand, you’ve got to embrace that. And that’s what we did.”

News of B-Dubs Express comes during a difficult year for Buffalo Wild Wings. Sales have been stagnant, and an activist investor, Marcato Capital Management—led by hedge fund manager Mick McGuire—has publically called on the company to shake up leadership and sell hundreds of corporate-owned locations. Marcato, which owns roughly a 6 percent stake in Buffalo Wild Wings, also lobbied for positions on the company’s board of directors.

The pressure from Marcato seems to have worked; long-time CEO Sally Smith, who helped take Buffalo Wild Wings from fewer than 100 units to more than 1,200 today, announced in June that she would retire at the end of the year, and Marcato—which has called on Buffalo Wild Wings to franchise 90 percent of its system as opposed to today’s 50 percent—named three of its directors to the company board.

Jason Moser, an analyst with investment insights company The Motley Fool, says that while Buffalo Wild Wings is contending with several issues today—Marcato’s pressure, Smith’s departure, and sagging sales among them—its biggest problem is maintaining a strong in-store experience in an increasingly convenience-minded world.

One of the chain’s strongest selling points is providing the opportunity to sit down for a beer and a meal while watching a game, he says, and if it loses out on the high-margin alcohol sales from dine-in customers, the company could be in trouble.

“As consumers continue to assign more value to their time, it becomes a bit tougher to continue to stoke traffic in those restaurants on a consistent and sustainable basis, and that will be a problem,” Moser says.

While the B-Dubs Express locations will still have TVs, beer, and wine, similar to traditional Buffalo Wild Wings restaurants, Moser says the food will inevitably become more important in the counter-service model.

“The smaller concept could certainly help the cause; the biggest question mark is, will the food drive traffic?” he says. “If it does, then that’s great. The smaller stores cost less to build and operate. But if the success of the Express concepts comes at the cost of the performance of the larger stores, then they could have a much bigger problem on their hands in a massive base of underperforming stores that require a lot of investment.”

Kronebusch says there are three keys to success for the Express prototype: customer adoption of the brand, the cost of labor, and the cost of products.

With the first two locations in particular, the company plans to figure out how it can leverage labor and product costs in such a way that the Express model becomes financially sound.

“The test is really about, do the financials make sense?” he says. “Can you get the proper ROI on this?”

As for customer adoption, Buffalo Wild Wings plans to test new technology tools that enhance the experience. That could possibly include mobile order and pay, Kronebusch says, as well as kiosk ordering.

“It’s not always something that consumers gravitate to,” he says of kiosk ordering platforms, “but we think that in many situations, you can create a value proposition with a kiosk so that it is speed and convenience, and it’s something that can help the consumer get in and out.”

Buffalo Wild Wings has a calculated plan to expand the B-Dubs Express model; the company is committed to six total, and will use those initial units to work out the kinks and prove the concept.

If all goes according to plan, Kronebusch says, B-Dubs Express could become a versatile option for both the company and its franchisees to open new units in underserved areas like college towns.

“If you found a trade area that you hadn’t had success penetrating,” he says, “I think this is an opportunity for us to go in and put in a unique experience and opportunity for our guests.”