Seeing Double
Under pressure from chains, more independents than ever are opening additional locations.
By Scott Hume, Executive Managing Editor -- Restaurants & Institutions, April 1, 2006
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R&I Top 100 Introduction R&I Top 100 List Independence Days Seeing Double  The Angus Barn’s country comfort and cuisine.  Private-dining rooms provide revenue for Harry Caray’s Restaurant.  Daniel’s European chic.  Spacious grandeur of Atlanta Fish Market. |
Many of the most successful restaurants are defined by their locations as well as their food and service. Tavern on the Green in New York City’s Central Park; Scoma’s on San Francisco Bay; Portland City Grill atop that town’s tallest building; and SkyCity at the Needle high above Seattle all are restaurants with a deep, specific sense of place.
Junior’s in New York City’s Brooklyn borough is another. Since 1950, the restaurant on Flatbush Avenue has been known for founder Harry Rosen’s cheesecake recipe and an eight-page menu of overstuffed deli sandwiches and breakfast dishes served all day.
That’s why when Junior’s third-generation co-owners (brothers Alan and Kevin Rosen) announced plans to open another Junior’s next month in the heart of Manhattan, it surprised some loyalists. But unit expansion is no longer an unusual strategy for Top 100 operations. For all the talk about how chains are squeezing out independent restaurants, replicating successful brands has become common.
More than one-third of this year’s Top 100 Independent Restaurants have spawned at least a second location with the same name. That doesn’t include two—Mix in Las Vegas and Lutèce, also in Las Vegas—that are flourishing siblings to concepts whose originals have closed. The current acceptance of brand replication is a dramatic change from even 15 years ago, when R&I’s ranking of the largest-grossing operations included only a handful of restaurants that were other than single-site brands (see sidebar “Looking Back”).
Times change; business philosophies alter with them. Alan Rosen says his father, (founder Harry Rosen’s son Marvin), didn’t think about opening more Junior’s; his only concern was serving each customer the best food possible. “His tenet was that you put it all on the plate,” he says.
That “old school” commitment to quality never goes out of style, Rosen says, but it can co-exist with new-school business thinking. That’s why the third-generation managers created a Web site in the 1990s to sell Junior’s cheesecakes around the world and why in 2000 they opened a takeout/bakery operation in Grand Central Station (which had sales of $6 million last year).
But Rosen had been looking for the right location for a Manhattan Junior’s for two or three years. When restaurateur Marc Packer closed Bolzano’s Bar Cucina in the city’s theater district, Rosen says everything clicked.
“The location, the size, the demographics—a mix of tourist and local guest traffic—everything was right,” says Rosen. His motivation was to take the Junior’s concept where potential guests are, echoing the thinking behind development of every chain-restaurant operation.
“We’ve been a successful independent, but with three locations we have a pretty strong brand in New York City with that much more exposure,” says Rosen.
He isn’t ruling out additional locations, even outside the Big Apple. Opening an Atlantic City. N.J., satellite as New York City’s Stage Deli has done (in the Trump Taj Mahal Casino Resort) “isn’t on the horizon” but Las Vegas has more allure. “If someone came to us with the right deal, I’d be interested,” Rosen says.
Buckhead Life Restaurant Group is doing much more than making the leap to a second unit of one of its most successful concepts; it’s rethinking its business model.
In January, the Atlanta-based multi-concept operator announced plans for a Chops Lobster Bar to open this year in Boca Raton, Fla., its first restaurant outside the home market and its first duplication of brand. Further, Buckhead Life founder and CEO Pano Karatassos says the move is the beginning of possible national expansion of the steak-and-seafood concept.
Managing that kind of business requires different thinking of the sort possessed by Greg Carey, brought in by Karatassos as Buckhead Life president and COO. Carey’s career includes stints as Minneapolis-based Rainforest Cafe; Scottsdale, Ariz.-based P.F. Chang’s China Bistro; and Tampa, Fla.-based Outback Steakhouse, where he served as founding president of the Paul Lee’s Chinese Kitchen concept.
Arizona and other Florida markets are being considered for possible locations, along with Washington, D.C., and Las Vegas, a popular stop on the path from independent status to chain creation.
Third-Time Charmer
Salty’s on Alki Beach in Seattle is one of three Salty’s locations, but it wasn’t the original. Or the second. Owner Gerry Kingen opened Salty’s Seafood in Portland, Ore., in 1980, moving north to Des Moines, Wash., the following year with Salty’s on Redondo Beach. Seattle’s Beach Broiler restaurant on Alki Beach was doing about $1 million annually when Kingen purchased it and transformed it into the third and largest Salty’s. By 1991 it had sales of $6 million and was among R&I’s Top 100 Independents; last year, sales were nearly $10.5 million. The first two Salty’s average about $5 million annually.
Bonnie David, managing partner of the Alki Beach location, credits its growth to Kingen’s understanding that a restaurant needs to provide more than a view. “I think Gerry’s brilliant. He understands guests; he’s very involved in each of the restaurants,” she says. Addition of Saturday brunch helped the location increase sales by 8%. “Seattle’s a great food city; there are lots of wonderful restaurants,” says David. “It keeps us on our toes.”
Some of that competition comes from chains, but Kingen understands multi-unit strategies well. In 1969 he purchased Seattle’s Red Robin tavern and transformed it into a restaurant with a new menu of 28 different burgers. He began franchising the Red Robin Gourmet Burgers concept in 1979, later selling it to a Japanese company. Red Robin had more than 300 units at the end of 2005.
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