There’s a double cook line, with the second line built specifically for off-premises and cocktails.
First Watch paid specific attention to patio upgrades in recent months, too. In a COVID landscape, they’ve taken on added importance, and not just because they build on capacity. Patios also attract passerby consumers who aren’t sure where to stop for a meal, what’s even open, or if they can (or should) go inside. Seeing an attractive patio takes care of that, Tomasso says. It’s leading to demand generation and trial.
First Watch invested in simple elements like greenery, heaters, and fans. But it also recessed patios, meaning they’re still under the roof of the restaurant. Now, there’s a hard roof that opens out. And, in some spots, First Watch deploys garage doors to extend the experience. The Orlando spot features accordion windows that open up and bring the “outside in and the inside out, and make it just an immersive experience for the customer,” Tomasso says.
First Watch's Oak Brook debut includes tall windows that provide bright natural light and an elevated dining experience that builds upon the company's "Urban Farm" prototype with the addition of warm blue tones, high open ceilings, an open kitchen, and a sunroom and patio.
From a high level, Tomasso says competition has been stiffer than expected among restaurants for sites, at least in terms of mid-2020 predictions. This is especially true in the suburbs, where First Watch predominantly resides.
This makes the flexibility element all the more critical, he says. There are a lot of different ways restaurants can reach guests currently, and footprints can reflect that.
As successful as First Watch’s off-premises growth was, however, dine-in remains the essential target. In November, the brand brought alcohol to restaurants for the first time since its founding in 1983. It arrived with a menu of signature brunch cocktails at 100 locations.
Some launch options included Cinnamon Toast Cereal Milk: Coconut rum, cold brew coffee, coconut milk, and agave nectar; and the Million Dollar Bloody Mary: Gluten-free vodka, house made bloody Mary mix, and a strip of First Watch’s signature Million Dollar Bacon.
Alcohol was in the works well before COVID, Tomasso says. Pilots showed demand and incremental, additive business. But the pandemic timing worked in First Watch’s favor.
Customers making the break from quarantine life haven’t been hesitant about indulging, Tomasso says. And he expects that to carry through when pent-up demand and social occasions surge back into the picture. Typically, these things hold hands.
Today, about two-thirds of First Watch’s company-owned restaurants offer alcohol. “Obviously, highly profitable,” Tomasso says. “And also helps us appeal to a different demographic perhaps than we were before.”
The alcohol program, coupled with off-premises growth (and capacity increases, of course) have helped First Watch inch closer to 2019 sales levels. “We couldn’t be happier about that and we’re ready to continue to grow,” Tomasso says.
First Watch’s average per-person check is $14. It’s a concept that thrives on frequency as a “network of neighborhood restaurants, not a chain,” Tomasso says.
At the onset of COVID-19, First Watch spent lockdown days fast-tracking online ordering and delivery. It partnered with Olo to do so, linking up with DoorDash and Uber Eats at all locations as well. The company also developed a new mobile app to allow guests to place orders for takeout and delivery, and get in-line for a table when deciding to dine on-site. First Watch integrated technology with waitlist management solution Wisely to manage the wait for dine-in and curbside pickup, while simultaneously gathering guest data on consumer preferences.
The waitlist tool, first announced in June, is active on First Watch’s app, website, and Google. Data runs into Wisely’s CRM, giving First Watch the insights needed to trigger or automate personalized campaigns. Wisely deploys data collected from Olo to populate the CRM.
As a result, First Watch’s off-premises mix rose to 30 percent of sales by the fall—up from 6 percent in 2019.
“That’s a mix of those sales going up and the in-restaurant sales going down, as to why those percentages grew like that,” Tomasso says. “Be that as it may, the dollars that we’re doing in to-go is substantially more than we’ve ever done before.”
Tomasso credits this to the Easter call to suspend operations at corporate units for more than a month. “We geared that whole function up, and that muscle, and we stood that up and now we’ve gotten good at it,” he says. “What we’re anxious to see is when consumers feel more comfortable going back in dining rooms to eat and we get back to those pre-COVID levels there, how much of that off-premises will we retain?”
Elaborating on his earlier employee comment, Tomasso says First Watch is at the “staffing levels that we’ve been targeting,” although the overall picture remains murky considering unemployment benefits and other changes taking place nationwide.
First Watch committed out of the gate to continuing all furloughed workers’ existing healthcare benefits and to covering 100 percent of out-of-pocket costs, co-pays, and deductibles for any medical visits related to COVID.
It also invested in telemedicine for every employee and their family, at no cost, and provided relief payments to long-tenured furloughed hourly workers to help with immediate expenses.
For perspective, that latter benefit was previously offered to employees on First Watch’s insurance plan, or roughly 1,300 people. So, essentially within days, it added another 7,000 people.
Additionally, First Watch created an employee assistance fund, called the You First Fund (a play on the company’s mantra) that offered $1,000 to eligible workers.
One of the bigger efforts, though, was a company promise to managers to make them financially whole by providing a bonus upon their return to work to assist with hardship costs incurred as a result of the pandemic and work to close the gap between the federal and state benefits they received and their First Watch salary. Basically, when they returned, First Watch paid the difference in their salary versus what they received in UI benefits.
“The most important part of that is we kept people who were already invested in First Watch,” Tomasso says. “Already trained. Already knew our systems. And that has tremendous value. The fact we didn’t have turnover at that time, I know has a savings effect versus bringing in new people and training them.”
First Watch was also one of the early brands to offer PTO for vaccines (two hours in this case).
Looking forward, Tomasso falls into the camp of restaurateurs who believe a pent-up demand era is coming.
“I do believe that we’ll see a return and a resurgence,” he says. “I think it has been well publicized and well documented the challenges that our industry faced during this time. I think the consumer respects that, and wants to show their support. And not only that—I really think overall the consumer recognized how important socialization and dining out really is to them. And their lives. And I think they’re anxious to get back to that and we’re obviously anxious to welcome them.”
