Aside from the prototypes, Perkins and Huddle House have created a more attractive model by investing heavily in off-premises, which has risen from 6-7 percent prior to COVID to about 20 percent.
All 80 company-owned Perkins restaurants and 50 corporately owned Huddle House locations sell virtual brand MrBeast Burger, a product concocted by Virtual Dining Concepts. It’s named after Jimmy Donaldson, aka MrBeast, who has nearly 100 million subscribers on YouTube. The concept is in the beginning stages of growing in each company’s franchise systems. Abt says MrBeast Burgers has good food costs and isn’t competing with restaurant menus because it serves a completely different customer set.
“The way we look at it is, we can do another 10 or 15 MrBeast orders per day in our restaurants and increase our sales by 4 or 5 percent and we don't have to add any labor and we add just a few SKUs to the restaurant,” the CEO says. “It's been a great way to just add revenue quickly to our restaurants in our existing four walls, leveraging all of the fixed costs that we have, and having to use no additional equipment.”
Internally, the company developed Papa Carazón’s Quesadillas, a brand that uses existing flat grills. It was launched in Huddle House a few months ago, and it’s starting to be rolled out at Perkins. Same with MrBeast Burger, food costs are manageable and little incremental labor is required. There’s also Bakery by Perkins, an idea from CMO Joe Artime, which allows customers to order baked goods on third-party platforms.
“One of the reasons why we're excited about the virtual brands is that it helps us build back some dayparts that we may have naturally lost because the consumers habits regarding dining and eating have changed,” Abt says.
In terms of technology, Perkins and Huddle House are rolling out handheld tablets so servers can send orders to the kitchen instantly. Abt believes the innovation will create front-of-house efficiency, ease labor costs, and help restaurants turn tables faster. The chains also installed EMV devices so employees can swipe credit/debit cards at the table, and Perkins is in the process of updating its 20-year-old POS system.
With these strategies in tow, Huddle House expects to sign upwards of 30 restaurant commitments this fiscal year, and Perkins anticipated more than 10 signings.
“People see breakfast as a treat,” Abt says. “Most family-dining breakfast concepts, it's not somebody dashing to work in the morning. It's people meeting and gathering. It's providing that sense of community over the communal table for people that enjoy breakfast and it's still a huge treat on the weekends.”