Anthony’s Coal Fired Pizza & Wings is as healthy as it’s ever been since COVID began.
In October, same-store sales surpassed 2019 levels for the first time. In Q3, comps rose 3 percent year-over-year for the 60-unit brand, and systemwide sales grew 4 percent to $31.5 million. Also, because of commodity costs stabilizing, Anthony’s generated a 210-basis-point improvement in restaurant-level margins. Pre-COVID, Anthony’s earned $2.3 million in AUV and a restaurant-level operating margin of 19 percent. From 2011 to 2019, it grew revenue at a compound annual growth rate of 12 percent.
“At Anthony’s we have good penetration here in the Florida market and have for quite some time,” says CEO Ian Baines. “During COVID, as we all know, Florida behaved differently than many other states. So the business came back quite quickly in our Florida markets, but outside it was slower to come back in terms of the behavior of guests. So it was a matter of our northern locations catching up to the great results that we were seeing here in Florida.”
But this isn’t the only turning point in the chain’s current COVID story. From the moment BurgerFi purchased Anthony’s for nearly $157 million about a year ago, the company has been transparent about franchising the casual-dining chain. Those plans will come to fruition in 2023 thanks to NDM Hospitality Services, one of BurgerFi’s original franchisees. The company owns seven restaurants mostly in South Florida, a region that Anthony’s has played in for years.
The agreement calls for three Anthony’s locations in Florida over the next two years.
“They are just terrific operators,” Baines says. “They really have taken the time to understand, and in some ways, as the BurgerFi brand has continued to grow over the last 11 years, they’ve been a great partner in sharing some of the best practices, which have filtered into the BurgerFi brand as a whole. So there is a very, very strong mutual respect both from how they view BurgerFi and how they view the Anthony’s operations and how we view them. We’re very excited that they were the first adopters.”
Anthony’s first dive into franchising will be nontraditional. The brand will enter a BurgerFi location in Kissimmee, Florida, in spring 2023 as a co-brand concept. NDM Hospitality will add 1,000 square feet onto the building to accommodate the pizza and wing chain, including a new gas-enhanced coal-fired oven from Wood Stone, which Baines calls “one of the premium pizza oven builders in the U.S.” The back-of-house layout and prep stations are similar to a typical Anthony’s restaurant. The estimated investment is between $150,000 to $200,000.
Baines says there will be opportunities for cross-utilization of labor when it comes to preparing products for both brands and taking orders at the cashier station. He notes, however, there is specialized training for employees dedicated to making pizzas.
In terms of the menu, all of Anthony’s proprietary ingredients will be used, like the Italian imported tomatoes and olive oil, mozzarella cheese, and homemade pizza dough. Ninety percent of Anthony’s offerings will remain the same; the only items left off will likely be a handful of sandwiches. Fifty percent of sales are pizza and 15-18 percent are chicken wings. The rest are appetizers, salads, and other products. One of Anthony’s biggest strengths, Baines says, is its tightly curated SKU count.
“There is a high level of excitement because we’re putting together two of the highest sales of food groups here in the U.S., and it continues to grow,” says Ian Baines, CEO of Anthony’s Coal Fired Pizza & Wings and BurgerFi.
The CEO believes the cobranded concept has enough promise to be scalable.
“We have had other BurgerFi franchisees express interest and are excited to see the first one and see how it all works,” Baines says. “But there is a high level of excitement because we’re putting together two of the highest sales of food groups here in the U.S. and it continues to grow. … Putting two highly desirable products under one roof, it just makes sense.”
Most of Anthony’s franchising growth will come via a slimmer prototype. The chain’s legacy box is roughly 3,200 square feet, but the new store design will range from 2,000 to 2,200 square feet, with more than 60 seats in the dining room and the bar still intact. The smaller size isn’t necessarily a novel idea for Anthony’s. A location in Boca Raton, Florida, open since 2015, is around 2,000 square feet. An older restaurant in Weston, Florida, is around that square footage as well. Meaning to say, Anthony’s already has a good idea of what kind of volume it can do in that tighter space, giving it more confidence in the latest prototype.
Baines emphasized that even though the chain is downsizing, it will still keep its full-service identity because of the quality of ingredients and significant alcohol mix that ranges from 13-20 percent. But he didn’t rule out gaining more exposure through a supplemental delivery/takeout spinoff. Anthony’s off-premises mixes 50 percent, well above the 35 percent rate prior to the pandemic. Digital accounts for 36 percent of sales. The brand recently rolled out an AI phone answering system to help with off-premises orders. So far, the technology has led to an uptick in average check.
“Especially with pizza, it makes sense,” Baines says. “And indeed, this co-branding in a way will give us an indication of how that plays out with the consumer.”
NDM Hospitality is pretty close to finalizing a second franchise location. Baines can’t share details yet, but he did note that it will be in South Florida. At this stage, Anthony’s is gathering interest and moving forward in discussions with a number of new and existing franchisees.
Similar to BurgerFi’s growth plan, Anthony’s is looking to deepen its ties in Florida and move up through the Eastern Seaboard. The brand is based in Pennsylvania, Delaware, Maryland, New Jersey, New York, Rhode Island, and Massachusetts, in addition to the Sunshine State. Baines says there will be opportunities for Anthony’s to refranchise some of its corporate units too.
Although talks of recessions have gotten louder in recent weeks, Baines says those concerns haven’t entered development talks with prospective operators yet.
“We are very proactive from a supply chain standpoint and actively working, especially with our equipment suppliers, to make sure that we are lined up because we know how many restaurants we expect to open next year. So we have the equipment started and ready to go,” Baines says.