Fazoli’s
Celebrating 20 Years
Founded: 1989
Number of stores: 252
Headquarters: Lexington, Kentucky
Spaghetti with marinara sauce—not pizza—is the bestseller at this Italian quick-service chain, which in July landed on Parents magazine’s list of the top family friendly restaurants. It’s all thanks to the average check: $5.92 for lunch and $5.77 for dinner.
The chain, founded by Kuni Toyoda, was purchased in 2006 by Sun Capital Partners, which placed McDonald’s veteran Robert Weissmueller at the helm. In 2008, Carl Howard, formerly of Damon’s Grill, became president and CEO. By May 2009, Howard had overhauled Fazoli’s menu, launched a social media campaign, and hired new talent, such as Scott Deibert from Steak ‘n Shake, who became vice president of supply chain management and quality assurance. “We have a mix of the old and the new,” Howard says of the management team. “Some of our HR and franchise people have been with the brand for 15 years.”
But it was out with the old and in with the new for menu items when Howard took over. “We changed just about every single item, from the marinara sauce to the sandwich lineup,” he says. Not everything debuted without a hitch. A Caprese salad with buffalo-milk mozzarella, tomatoes, basil, and grilled chicken tested well, but consumers were timid. They’re also not warming up to an antipasto salad.
Other additions, however, have boosted sales. The chain last February released a line of baked pastas, which were well received. Specialty pasta dishes—including Tortellini and Sundried Tomato Rustica, Chicken Carbonara, and Creamy Chicken Basil—followed in May. “We’re starting to get credit for the changes,” Howard says. “Sales are positive; I couldn’t be any happier.”
Introducing a design for airports is at the top of the chain’s to-do list, and Howard isn’t ruling out college campus locations. Fazoli’s does, however, serve about 50 to 100 elementary and middle school lunches a month. “We bring it, set it up, clean it up, and take everything away,” Howard says. The average price is $2.99, and spaghetti and meatballs is the most often requested entrée.
Whether it’s in the restaurant or in a school, Fazoli’s is living up to its two-year-old slogan: “fast. fresh. italian.”
McAlister’s Deli
Celebrating 20 Years
Founded: 1989
Number of stores: 300 by the end of 2009
Headquarters: Ridgeland, Mississippi
McAlister’s Deli was founded by retired dentist Don Newcomb to serve delicious food with a side of Southern charm, and that mission remained the same when Phil Friedman and Michael Stack bought the company in 1999. The new management, however, was intent on spreading that charm farther afield. The company has been on the fast track, moving from 35 to nearly 300 restaurants in 10 years, and growing from the South toward the Midwest. To support the growth, McAlister’s hired veterans like senior vice president of operations Ken Green, a Friendly’s Restaurant alum. “We needed to take our team to the next level,” Friedman says.
To do so, McAlister’s seeks strong franchisees with the business savvy and financial resources to develop an area. “Instead of 200 or 400 franchisees, we want 70 really great ones,” Friedman says. A number have experience with other chains, such as Arby’s or Papa John’s Pizza.
McAlister’s has even ventured onto university campuses in recent years with four sites, two of which are affiliated with student unions. The other two reside in food courts. The chain is moving into hospitals and airports, using a 600- to 1,000-square-foot prototype.
The new pickup window is particularly handy for customers who want McAlister’s sweet tea—and there are a lot of them. The tea is responsible for 65 percent of beverage sales. “There’s nothing exotic about it; it’s not a proprietary recipe,” Friedman says. “But we do steep and brew it every few hours and it’s poured hot over ice.”
The high price of commodities began to present difficulties recently, particularly when customers were also feeling the pinch. McAlister’s average check is $8 per person, so salads became an affordable option, both for the restaurant and the consumer.