In a Crowded Better-Burger World, Bareburger Finds its Place

Impossible Foods’ beef replacement, for example, famously behaves like ground meat and can be served in a number of applications, including taco crumbles, meat sauce, and, of course, burger patties. It’s gluten-free, halal, kosher, and cholesterol-free, and made from soy protein, potato protein, coconut fat, sunflower oil, and hem, which is short for hemoglobin, something that is found in all living things, including meat. Impossible produces hem from a plant source.

And unlike the veggie and black bean patties of old, it’s a movement designed to target diners searching for meat substitutes, not necessarily vegetarians or vegans. Darren Seifer, NPD food and beverage industry analyst, told QSR that 90 percent of consumers are neither vegetarians nor vegans, but instead identify as flexitarians. These guests, the majority of which are millennials, followed by Gen X, per The NPD Group, are concerned with health and want to increase protein while also cutting down on meat.

Also, according to NPD in a July report for the year-long period ending in May 2019, quick-service restaurant orders for plant-based burgers and sandwiches rose 10 percent over the prior year to 228 million servings.

But notably and this is where the real distinction is drawn, beef burger buyers represented the majority of orders—95 percent of those who tried plant-based also made a regular beef burger purchase within the past year. Beef burger buyers, who purchased beef burgers at quick-serves an average of 18 times in the year ending April 2019, purchased plant-based options two times in the period. (As a side, 6.4 billion beef burgers were ordered at quick serves in the same sample, a roughly flat year-over-year figure).

Vegetarians and vegans are contributing to the growth in plant-based, but still represent a single-digit percentage of the U.S. population and haven’t been “primary contributors,” to movement. Moreover, 18 percent of the overall adult population said they were simply trying to get more plant-based foods into their diets, NPD said.

Seifer noted that plant-based burgers also address social concerns, which is a big argument in the lab-grown meat movement’s corner.

In Bareburger’s case, Pelekanos says, the brand witnessed more and more guests looking for vegan food. And not in small doses. “They wanted the full package,” he says. So, while Impossible and Beyond didn’t intend for their food to get buried in a corner with a vegan label on it, Bareburger saw opportunity in the reverse direction: They’d fly a vegan flag for those looking for it.

A burger top to bottom that’s vegan? From the bun to the cheese to the sauce to the protein? That’s a serious point of differentiation in an ocean of plant-based opportunity, Pelekanos says.

Achieving that goal, however, was not easy. But it speaks to the inflection point better-burger chains face today. It’s innovate or get buried by lower-priced competitors who can push the envelope on value.

Bareburger tapped its local baker to create a vegan brioche. It started carrying more plant-based options, like organic tempeh bacon and JUST egg products. It teamed with Follow Your Heart to menu vegan cheeses. Sauces shifted to soy based instead of mayo. “And we made those changes without compromising any of the taste, without compromising any of the quality,” Pelekanos says. “We basically mimicked our original menu, and now when guests come to our restaurant all our servers tell people, ‘hey, this our original Bareburger menu. Flip it over and you have almost the identical menu but it’s 100 percent vegan and plant based.’”

“Tasting notes on each of those items mimic each other,” Pelekanos adds, “which I think was a pretty radical move by us.”

Bareburger added just four SKUs to pull it off. Yet it was a massive learning curve, he says, from not only the positioning of the menu, but going back into all of the restaurants and retraining staff. Back-of-the-house employees use separate griddles now. They need to change gloves. “You have to take this serious,” Pelekanos says. “A lot of folks who comes in our restaurants, it’s not a lifestyle thing. It might be something they’re sensitive to from an allergy standpoint.”

He estimates it took at least six months of training—an investment well worth it for the future of the brand. Bareburger shut down every restaurant for a day. It took the opportunity to clean units but also had operations teams come and talk about the new menu and company vision. Then, executives spent time with kitchen employees training on cross contamination best practices and how to use the right cooking services.

Lastly, Bareburger needed to educate servers beyond just being able to read off new products. They had to fully understand how the food was made and what’s really in it. People who eat vegan typically don’t hold back on questions.

“It’s such a challenge to get our servers, our food runners, our counter people, to educate people when they ask, what’s in an Impossible Burger? What’s in the Beyond Burger? How do you make that cheese? What makes it vegan?” Pelekanos says.

Since, Bareburger has had to stay on top of this directive and constantly reinforce learning with servers. “It’s continual, continual work,” Pelekanos says. “It’s not like we went in one day, trained the restaurant, and it all worked.”

Bareburger sends in secret shoppers from time to time and calls and asks questions at random. It continues to monitor how that side of the menu is spoken about, Pelekanos adds.

Has it paid off? “I think we’re starting to see the recognition for what we’ve done with the menu. But I don’t think we’ll reap the full benefits for at least another three to four years,” he says.

The vegan commitment stressed Bareburger’s supply chain, too. Many of the more artisanal suppliers weren’t used to this volume. Tempeh bacon for example. “Those types of headaches are what you get when you try to do something like what we pulled off here,” Pelekanos says.

Then came the less operational angle. How do you flood new offerings into a restaurant system without alienating diehard fans, those who have been loyal to the New York-centric brand for a decade? Bareburger was founded 2009 in a vacant bakery in Astoria, New York, and has scaled to restaurants in New Jersey, Connecticut, Pennsylvania, Washington, D.C., Georgia, and Ohio. There are international locations in the UAE, Japan, and Germany as well.

“When they come to the restaurant you still have to reinforce the fact that no, Bareburger didn’t become a vegan restaurant. Bareburger still has a ton of clean proteins and delicious food on their menu,” Pelekanos says. “But we’re just giving people the option that hey, I don’t want to eat meat every day or every week.”

A new look, a fresh future

In October, Bareburger debuted a Columbus Avenue restaurant that featured a cooler color palette with blue, sleek seating paired with rustic paneling. It’s part of an ascetic refresh Pelekanos says is key to propelling the brand into a new decade. More modern and farm chic versus rustic.

This includes paying added attention to the physical space and how it serves off-premises orders. Things you didn’t worry about 10 years ago, Pelekanos says. When Bareburger first started, 80 percent of its business was dine-in. Now it’s 50/50 with delivery and take-out mixing the other half.

“We look to design the spaces now where it’s easier access for delivery guys to come pick up food, deliver it better. Opportunities for guests to come in and pick up their takeout,” he says.

Kiosk and tabletop ordering are in the works, along with app improvements.

Pelekanos says Bareburger is also investing in ways to get more guests to order through its online platform instead of third party so it can guard margins. “The bottom-line effect [aggregators] have on restaurants like ours and the mom and pops, is quite severe. I mean it’s in the millions the fees that are paid to the third-party sites,” he says. “And you know, we’re doing our best to sort of push, move that needle a little bit. Push that traffic back to our site. Back to our restaurants. And we do that by giving people a good loyalty program and good incentives to order from our site.”

With direct delivery, Bareburger keeps the data and lets its technologies talk to each other—its app is connected to online ordering through the website. It’s not piecemeal and fractured.

About half of the chain’s stores have their own delivery drivers. Third-party typically services the rest.

In terms of expansion, Pelekanos says, Bareburger made some early mistakes growing too fast and out of its reach. He says the team is now laser focused on maintaining and opening better restaurants and taking a regional approach over a national one, “which I think makes a ton of sense given the complexities of our supply chain,” Pelekanos says. “Also, given the fact that the restaurant industry is obviously a lot more competitive than it was. The closer a new location is to your home the more you can control your marketing spending, your account, the supply chain.”

Even with new-age models, like ghost kitchens, possibly in the works, Bareburger will stick to its traditional brick-and-mortar roots for the most part. “You want people to walk by, feel your place, hang out at your place, eat your food, fresh and hot, instead of it travelling 30 minutes,” he says. “That’s still who we are.”