It’s no secret that the COVID-19 crisis left the restaurant industry shell-shocked. With dining rooms closed, the pandemic challenged brands to think differently and act fast. When the crisis first hit Dog Haus, we saw systemwide sales cut by 50 percent. With our backs against the wall, we were forced to be strategic and nimble. We never would have imagined we’d see our stores exceed pre-pandemic sales numbers after implementing new initiatives, but, versus prior year, our sales were up 2.3 percent in June and 10.6 percent in July.
Here is how Dog Haus reacted to the challenges brought on by the pandemic:
We pivoted quickly. When our dining rooms were forced to close, we did not waste any time launching new offerings. One of our franchisees came to us about creating Haus Market—an adapted grocery store model at our brick-and-mortar restaurants that sold a variety of essential foods, including our hot dogs, ground beef, sausages and King’s Hawaiian rolls, to those who wanted to source our high-quality groceries while stock was low at local markets. We launched it quickly and ended up being one of the first brands to offer essential groceries. In addition to Haus Market, we also launched curbside pickup and our Take and Bake Sliders at a number of locations nationwide. Both were very successful and kept us top-of-mind with our guests.
We created multiple brands to run out of one kitchen. While each of our new offerings were helpful in giving our guests new ways to dine safely at home, and our franchise partners new revenue streams, what really moved the needle was the debut of The Absolute Brands—a restaurant group comprised of Dog Haus and eight unique concepts. We’ve been in the virtual kitchen space since April 2019, but with The Absolute Brands, we capitalized on something entirely new—virtual concepts. In March, we began offering three delivery-only brands—Bad Mutha Clucka, Plant B and Bad-Ass Breakfast Burritos at our virtual kitchens and most of our brick-and-mortar locations. Franchisees now can choose to use their current Dog Haus restaurant to serve The Absolute Brands’ virtual concepts, a model we refer to as host kitchens. We are effectively running four brands out of a single unit. Since The Absolute Brands’ launch, we’ve seen a huge spike in delivery sales. One of our restaurants saw a sales increase of over 300% after the implementation of these virtual concepts.
We optimized delivery. We found it was crucial to not only serve The Absolute Brands through third-party delivery services (3PD), but to maximize our partnership with them by identifying opportunities to increase our brands’ visibility. Each 3PD has its own algorithms that impact a brand’s ranking. We discovered that the best ways to capitalize on delivery through these platforms is to continually run promotions, opt-in to 3PD-funded opportunities, and encourage guests to leave positive reviews by including printed material and personalized notes in takeout bags.
We continue to cultivate new business opportunities. Now that we know The Absolute Brands have been popular both in virtual kitchens and host kitchens, all new Dog Haus locations opening over the next year will roll out The Absolute Brands. We are also discussing licensing our brands to other non-affiliated restaurants to act as host kitchens for our new concepts. To further pandemic-proof our brand, we are testing smaller footprint restaurants to operate for carryout and delivery only, and we are developing a prototype with a traditional drive-thru, as well as a dedicated lane for 3PD and mobile order pickup.
Entrepreneurs need to be strategic thinkers who take past successes and expand on them for the future. I like to believe our brand has attracted those that embody this mindset, and this has led to the successful implementation of our various initiatives. We’ve learned many lessons over the last few months and know we can’t get comfortable now that some dining rooms are open again. While we wait for the pandemic to end, our only option is to find new ways to serve our guests. Offering outdoor dining, curbside pickup or delivery are good measures to survive, but if you want to thrive you need to innovate and push the boundaries of how a restaurant operates. They say evolve or die, and this has never been more true!
Quasim Riaz is one of the founding partners of Dog Haus, the award-winning concept known for its gourmet hot dogs, sausages, burgers and one Bad Mutha Clucka. Alongside co-partners, André Vener and Hagop Giragossian, Quasim leads the design, real estate, and construction aspects of the brand—taking on all elements involved with opening a new location. He also leads the franchise development team—working with current franchisees and potential candidates to assist in further expansion of the brand.