For anyone wanting to enter the restaurant business, Alex Smith, CEO and founder of Atlas Restaurant Group, recommends a franchise.
He started with a Häagen-Dazs unit in May 2007 right after college. Smith did everything from scooping ice cream to running his own bookkeeping and managing the construction process with landlords. The shop is based in Harbor East, a revitalized mixed-use development in Baltimore, Maryland. At the time, Smith—one of the first restaurateurs in the area—also recognized that office workers needed a new lunch spot. In response, he opened Harbor East Deli, making cheesesteaks, pizza, and sandwiches, and learning a massive amount about the fast-casual segment.
That’s how Smith spent the first four years of his restaurant career. And that was only the beginning.
“After that it kind of went to warp speed,” Smith says.
His next venture was creating an upscale Mediterranean concept, inspired by his Greek familial history. Not only that, but Smith noticed Baltimore had gyro shops and traditional to-go spots for Mediterranean cuisine, but nothing sophisticated. In August 2012, he filled that void with Ouzo Bay, another concept based in Harbor East. In the following years, more than 20 different restaurants brands have opened across multiple states, creating what has now become Atlas Restaurant Group. All are independents, except for seafood chains Loch Bar (one unit in Texas, Florida, and Maryland), Ouzo Bay (one unit in Maryland and Texas), and Choptank (two units in Maryland). Atlas covers a variety of food groups, including Italian, Japanese, French, and American.
In 2022, the group will earn $130 million in net sales. Smith estimates that by 2024, Atlas will double that figure, fueled by increased volume and annual growth of four to five units. In terms of development, the company is booked through 2024 and already looking at 2025.
“Everything we develop we feel like is bringing something new to [Baltimore],” Smith says. “Not only for its residents, but as a regional tourist destination for guests that want to travel into the city. What we’re building is more important than a single restaurant. We’re really trying to revitalize a once great American city and I think still great American city through F and B. That’s been the goal.”
A majority are based in Maryland, but there’s a growing presence in Florida, Texas, Washington, D.C., and Philadelphia. Smith says Atlas opened Loch Bar and Ouzo Bay in the Lone Star State because it lacked variety in the seafood space. The company, which uses Samuels and Sons in Philadelphia as its supplier, flies product to Texas three to four times per week and couriers it to restaurants. Additionally, Atlas debuted Marmo in Houston to bring more red sauce Italian flair. It’s the sister restaurant to Tagliata, which is based in Baltimore. Smith acknowledges that Carabba’s performs well in the state (the chain has 14 in Texas, its biggest presence in the U.S.), but he felt customers could use something more upscale, similar to his reasoning for ideating Ouzo Bay about a decade ago.
“We went to Texas, and we were trying to find concepts that didn’t exist already in the marketplace and a place where we could create our own niche,” Smith says. “For instance, I’m not gonna go to Texas and open up a steakhouse. Probably not the place to do that. There’s a lot of great steakhouses in Texas. … It’s all revolving around how can we bring our expertise around seafood and some of the other things that we’re doing and and and create a new brand in the marketplace.”
Owning more than two dozen unique concepts does present its challenges, however. To simplify operations as much as possible, Atlas uses like product when it comes to basic ingredients and protein. As an example, the company uses Meats by Linz for meat at all of its restaurants and uses Samuels and Sons for seafood. Same cuts, but different preparation, seasonings, and flavors, depending on the restaurant property. For training, Atlas does its best to streamline steps of service and culture. Smith says 80 percent of what they teach employees is a core competency across the system, while the remaining 20 percent is specific to the brand.
Workers start at $15 per hour; for servers and bartenders, that includes the tip credit. But Smith emphasizes the wage level is for entry-level positions. Waiters typically make $25-45, line cooks make $20-24, and hosts make $18-22. Additionally, Atlas covers roughly 55-60 percent of health insurance.
Looking ahead, Atlas plans to enter Washington, D.C. in 2023 with two additional concepts, Lucha Rosa and Parlour Victoria. Both will open in the Moxy Hotel. The group also foresees more growth for Marmo and a fourth location for Loch Bar.
Atlas will likely have five Loch Bar locations open by 2024. Smith attributes the brand’s success to its approachability. A customer can either purchase an appetizer for $12-14 or spend $125 on a live lobster or prime ribeye steak. There’a also 400 brown spirits, local beers on tap, and live music seven days a week.
“We have people showing up at the store at 11, 11:30, 12, all the way till 1 o’clock in the morning, so the opportunity to create revenue is an all-day-long experience,” Smith says. “Also because because the concept is I would say 25 percent raw bar driven, you don’t need as big a facility to execute the concept as far as the kitchen and everything else. We’ve got Loch Bars in 2,700 square feet all the way up to 4,500 square feet. So it works in small spaces or it can work in a bigger space.”
Smith is wary of a potential dip in the economy, but he doesn’t think it will change growth plans. That’s because Atlas isn’t borrowing any bank debt, paying interest rates, or making major acquisitions.
He says the group is “living within our means,” when it comes expansion. If cash flow changes, Atlas will adjust, but right now, everything is on schedule.
“Our approach is organic growth,” Smith says. “That’s what it is. Just organic growth. Slow growth— expanding with our own cash flow and just inching along.”