— By Chris Birkinshaw —
Limited-service concepts, high-quality food options take pole position for QSR buildouts.
The COVID-19 global pandemic changed the landscape of many businesses. As we move forward with vaccines and a stronger understanding of how the virus spreads, businesses are more confident in reopening. Some are returning to pre-COVID operations, while others have taken on a complete redesign of operations to survive. For the restaurant industry, re-examining all operational processes and costs is taking place at a rapid, reactive rate. For many, this includes re-examining the brick-and-mortar concept, and many quick-service restaurants (QSR) are finding they may not need the hassle and headache with lots of square footage. At Aloha Poke, we were re-conceptualizing our operations for the future well before the global pandemic. From what we learned, the pandemic left an entire industry to figure out new ways to re-capture sales and maintain brand integrity while trying to reach both loyal and new customers.
As many restaurant concepts were forced to abruptly pivot or re-conceptualize entirely, the model we were moving toward with Aloha Poke allowed us to lean in as COVID sharply accelerated trends that were already there. Here are a few lessons behind our philosophy and experience.
Being Honest About Commercial Real Estate Needs
Interestingly, the fast-casual marketplace had been subtly signaling new attitudes toward commercial real estate needs. The cost of a 2,400-square-foot end-cap had been on the rise exponentially, given the number of restaurants bidding for the same piece of real estate. So, it’s not uncommon to see the end-cap in the strip side that maybe could accommodate a drive-thru or window and have four to five different fast-casual concepts running up the per square foot price because they’re trying to out-bid each other to win the space. What isn’t always considered is that the economics are different from the rent equations, placing higher demands on bottom lines to yield more significant profit margins.
Buildouts Built Better
Trends associated with convenience and quality have been around long before COVID and the departure from fast food to fast-casual became clearer. When fast-casual disrupted the QSR industry at the turn of the century, the differentiators were obvious: on one side were the fast-food giants offering the most calories per dollar, and on the other side, there were emerging concepts providing higher-quality food, a healthier experience, and re-defined the “hangout” space (think Starbucks). Then the QSR industry did what great companies do — they evolved to enhance convenience, embrace technology and dramatically modernize their builds and remodels to all but remove the distinctions.
— Chris Birkinshaw is the CEO of Chicago-based Aloha Poke Co., a fast-casual franchise serving poke bowls filled with healthy, fresh, quality ingredients. Birkinshaw’s 20 years of progressive positions and expertise working with national restaurant chains have earned him a reputation as a dynamic and incisive leader combined with unique industry knowledge. He started his career at Starbucks in store-level operations, eventually moving to Potbelly Sandwich Works, where he held senior management positions across departments including Operations Services, New Store Development, District and Regional Operations, and Franchising.