Hot Spots: Taking Their 'Cue
Chains capitalize on strong barbecue appeal
By Allison Perlik, Senior Editor -- Restaurants & Institutions, 5/1/2004
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Carrying the smoky-sweet flavors of Texas and Kansas City, the sharp, tangy tastes of Memphis and the Carolinas and a host of savory variations in between, chains from coast to coast are hopping on the barbecue bandwagon. These operations know that while barbecue may dress itself in regional colors, its appeal is all-American.
“There is a definite loyalty associated with barbecue. Everyone has a different opinion of what it is and what’s good,” says Jeff Goldstein, one of three founders of Sticky Fingers, a southeastern chain based in Mount Pleasant, S.C. “That certainly makes it a challenge but also makes it fun.”
In a recent call note to clients, restaurant analyst David Geraty of RBC Capital Markets in Minneapolis noted several of the segment’s more encouraging aspects. Upgrading the stock rating of Minneapolis-based Famous Dave’s of America to “outperform,” Geraty said the chain’s attractive growth prospects stem in part from untapped market potential, proven portability, unique positioning and few national competitors.
For proprietors of fledgling barbecue chains, such a fertile climate produces a bright growth outlook.
Mass marketing
While local, quick-service restaurants generally characterized
the segment in the past, growing barbecue chains today are more
likely to build around casual dining, many with designs on a national
presence. Still, the debate continues: Can a cooking style with
such diverse traditions find mass-market success?
“It’s so regionalized there’s never been a successful national chain,” says former Wendy’s franchisee Jim Cheatham, founder and CEO of Ragin’ Ribs in Tampa, Fla. For that reason, Cheatham puts a different spin on his two-store concept. Instead of selecting among conventional choices, he coats St. Louis-style ribs in two sauce varieties of his own creation: honey glaze and spicy herb.
Cheatham’s reservations aside, most operators say national appeal is possible given the right resources and a solid concept.
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“I think the chain approach to barbecue is going to undress that regional preference theory a little bit,” says Marc Chastain, vice president of franchising and chief financial officer for Rib Crib, a Tulsa, Okla.-based casual-dining chain. “We’re in Florida, and we didn’t bring mustard and vinegar sauces. We just took our concept and executed and the consumer liked it.”
This philosophy is evident in the attention casual-dining giant Darden Restaurants is giving its 64-unit Smokey Bones BBQ concept. The Orlando, Fla.-based chain, which offers five types of sauce on every table to satisfy a variety of tastes, says it expects to open 25 to 30 restaurants per year moving forward.
Where there’s smoke
A key trait shared by emerging barbecue concepts is a dedication
to smoking meats on site—typically various types of ribs,
brisket, pork, chicken, turkey, ham, sausage, fish and lamb—whether
in traditional-style barbecue pits or commercial smokers.
Fiorella’s Jack Stack Barbecue, a three-unit chain in the barbecue bastion of Kansas City, Mo., uses what partner Case Dorman calls the “sear and tenderize” method, relying on a brick barbecue oven with interior dimensions of about 8 feet by 8 feet.
“We give the outside a heavy sear over the open flame and then turn the meat and slow the process so it can take its time tenderizing,” he says.
Dry rubs also are common to the cooking process. Many chains, including Rib Crib and Las Vegas-based Memphis Championship Barbecue, cook products mostly dry, adding a glaze of sauce at the end and allowing guests to add more at the table.
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Some concepts even follow strict preferences regarding the type of wood: Memphis Championship Barbecue imports applewood from owner Mike Mills’ hometown of Murphysboro, Ill., while El Paso Bar-B-Que Company of Scottsdale, Ariz., relies on pecan wood to smoke products more slowly at lower temperatures.
Fine points of distribution
Maximizing sales through multiple distribution points is a key
element in the business formulas of barbecue chains.
Fiorella’s and Sunset Hills, Mo.-based Bandana’s Bar-B-Q attribute more than 25% of unit volumes to carryout. Easy options include dedicated counters, cashiers and parking spaces. El Paso Bar-B-Que’s curbside service, dubbed “Ribs on the Fly,” accounts for 12% of sales, while Ragin’ Ribs’ home delivery tallies a beefy 65% of business.
At Memphis Championship Barbecue, two units offer drive-thrus at which only items that travel well are offered. The newest location, set to open this month, will feature curbside to-go service. The chain also sells its sauce and “magic dust” dry rub in select supermarkets.
Along the same lines, Sticky Fingers sauce and dry rub are sold in more than 1,500 grocery stores and do brisk online sales to customers around the country, Goldstein says.
Fiorella’s online business, which represents just under 10% of sales, extends beyond sauce to full meals and family packages.
“It’s the fastest-growing segment of our business,” Dorman says.
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