Consumer demands have been changing rapidly over the last few years, and FSC Franchise Co. is making sure its brands align with what customers want most.
The franchisor—which features 280 locations in 22 states across its three brands: Beef ‘O’ Brady’s, The Brass Tap, and Newk’s Eatery—is rolling out a number of changes based directly on research and feedback from its guests.
Beef 'O' Brady's Gets into Games
The first change is a new Beef ‘O’ Brady’s prototype featuring a family arcade.
Beef ‘O’ Brady’s, which has 143 locations in 21 states, is a family sports pub concept with $2.4 million in annual sales in its top quartile stores. Year-to-date, Beef ‘O’ Brady’s has signed four new deals, opened one new store, and plans to open two additional locations by year's end. The brand anticipates signing five more deals this year.
Over the last few years, two of its franchisees—one in Florida and one in Illinois—have rolled out the arcade model and found it to be quite successful. FSC decided to see if the model could be replicated in other locations as well.
“When we looked at the investment, the return that the franchisees were getting and what it did for the peripheral business, it helped the base business as well,” says Chris Elliott, CEO of FSC Franchise Co., who notes FSC would not charge any royalties on the revenue coming in from the arcade. “So we had a couple successful data points, and as we look forward, we asked, ‘What's Beef ‘O’ Brady’s going to look like in the future? Where's the industry going? How do we make the investment generate a greater return for franchisees?’ And all of that added up to, ‘We should develop a new prototype that includes the option of an arcade.’
To start, two new franchisees will be designing the arcade into their restaurants. “We're going to work with them to establish what a prototype would look like and what the variations on that would be, and then begin to make it available to anybody who would like to retrofit their store, if they have the space,” says Elliott, who notes anyone else opening new locations would have the option to include the arcade as well.
The Brass Tap Enters its "4.0" Era
FSC’s craft beer bar and entertainment venue The Brass Tap is undergoing even bigger changes, including a remodel that they’re dubbing “4.0.” “The first week was wildly successful,” says Elliott. “Sales were up 33% and consumer feedback was very, very positive.”
The Brass Tap has a top quartile average of $2.1 million and 40 locations in 16 states, with five more locations anticipated by the end of the year. The 4.0 remodel is a combination of changes to the physical structure of the restaurant as well as its menu. It includes enhanced tap wall offerings, such as tapped wines, more domestic and imported beers, and even cocktails.
Elliott says the plan is to make the restaurants a bit more upscale through design elements like softer seating and the switch from a wood to granite bar top. The 60-tap wall, which the brand is well known for, was enhanced to include more domestic and imported beers, tapped wine, and even cocktails on tap. Behind the bar, The Brass Tap has brought in more premium options, like higher-rated bourbons and tequilas.
Kitchen retrofits have also been a part of the revamp (as they also are on Beef ‘O’ Brady renovations). “Our volumes have doubled in the last decade, and the original kitchens were not designed for the volumes we're doing today,” says Elliott. “Kitchen technology has been a big piece of it so we can keep up with the growth.”
On the menu, FSC is looking to push The Brass Tap's food and liquor mix to 50/50 from its current state of 55% liquor and 45% food. To make this happen, they made some changes on the shareables and entrées sections of the menu. “The entrée area because that's where we thought we were weakest, and the shareables because that's our best-selling area,” says Elliott. “So we thought we'd increase the horsepower of the shareables and fix a weak area of the menu with the entrées.”
Some of the new items added to the menu are pork pot stickers, a choice rib eye for steak and frites, mahi-mahi, and shrimp and cheddar grits. “We're going to read this very closely and see what our current customers are most interested in,” says Elliott. “If [a menu option is] doing well, we'll lean into it. If it's not, we'll try some other stuff.”
FSC is also planning on reading the results of the 4.0 revamps very closely before it rolls out the new concept to all its franchisees. “We need to read the results of what we've done and do a little consumer research. Before we have people copying it, we want to make sure that we know the final cost to do it, and the impact on sales. If you have to spend a certain amount to do it, you really need to see the return in sales,” says Elliott. “What I learned early on was when you're trying to sell new ideas and new approaches to franchisees, who honestly don't like a lot of change, you have to have a lot of data, and you have to test it. If you show them hard results, then they get on board.”
Location, Location, Location
With FSC opening 20 locations between its three brands this year and managing a pipeline of over 100 stores, the franchisor knows the importance of picking the right locations and markets. “We have a site selection tool that's also a market planning tool. It's based on, of course, locations that are already open and how they perform, but it's a very sophisticated tool done by a company called Calibrate. There's a series of regression models that they combine to help give you the best information that you could have based on past performance of current locations of where the best trade areas would be for a given brand," says Elliott. "If a franchisee brings a site in, then you can score it, and you can either try to talk them out of it or lean into it. And if you're looking at developing a market, it will tell you in a market, like, where to go and where not to go. So you know, before you even start developing a market where the best trade areas are."
This tool isn’t the only thing FSC uses to inform its decisions. The company also does a lot of research, including attitude and usage studies, brand health studies, and more. “From that research, we lean into our strengths, and we try to figure out clever ways to address things that are not impressing our customers,” says Elliott. “The location decision, there's a lot to that. You can change the menu. You can change the marketing. You can change the general manager. You can do more local store marketing. You can't change the location. You’ve got to get that right.”
The issue of the right location recently came up with a Beef ‘O’ Brady’s located in the Tampa, Florida area for over 10 years. The neighborhood had outgrown the Beef’s, and so FSC decided to convert the location into The Brass Tap to better reflect the more adult consumers.
“All this stuff is us trying to stay ahead of the curve in terms of where our industry is going, what consumers are looking for, their attitudes,” says Elliott. “It's a tough year in our industry. It is a lot of changes, a lot of people getting out of the business, a lot of people struggling, and we're just fortunate to be in a really good place.”
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