Greg Finefrock doesn’t commission complicated studies to collect and gather feedback. He still adheres to the classic practice of spending time in restaurants. Recently, he asked a guest about something Finney’s Crafthouse has gone to great lengths to guard.
Over the past three years, the California-based chain Finefrock founded in 2016 and runs with his twin brother, Brad, has taken 5 percent in price. Brad says he’s researched every competitor he could muster. The lowest he’s found is in the low double-digits, call it 12–13 percent of price. The more common line is closer to 15–20 percent. And that’s not taking into account what’s unfolded in quick service, especially California, where looming legislation and $20 minimum wage could reportedly push some of the larger players well over 20 percent.
According to the BLS, the Consumer Price Index for Food Away from Home increased 5.2 percent between December 2022 and December 2023. While the ninth consecutive month of decelerating growth and the smallest 12-month increase since September 2021, there’s no denying the present landscape is elevated from the old one—and there’s no indicator it’s going to reverse.
Category wise, prices for limited-service meals and snacks increased 5.9 percent between December 2022 and December 2023. That was down from the recent peak of 8.2 percent in April, which represented the strongest 12-month gain since the beginning of this data collection in 1997.
Full-service menu prices rose 4.5 percent between December 2022 and December 2023. That was up slightly from 12-month increases of 4.3 percent in both October and November, yet remained below 9 percent gains posted during 2022.
Generally, when restaurant and retail brands lift prices, they don’t slide back down. Value might pulse through deals and promotional constructs (like value menus), but if brands didn’t hold fort amid the chaos, they’re not going to change course after.
So the question for Greg was, did guests notice? “I said, ‘what do you think of our prices?” Greg recalls. “And she goes, ‘I don’t even look at your prices.’”
Greg believes this is validation in its loudest form. Instead of deal searching, Finney’s customers expect value without seeking it. “What we hear from everybody is, you’re the best value in town for the experience that you get,” he says.
Greg opened Finney’s with two decades of franchising experience. He started as a delivery driver at Domino’s before becoming an operator at counter-serve Baja Fresh, where he opened 12 units as a franchisee. Greg then went on to The Counter. In 2016, with Brad initially as a silent investor, Greg decided to open his own concept where he could focus on experience from the outset. Finney’s (inspired by Greg’s nickname) launched a broad, value-oriented menu around craft beer, made-from-scratch burgers, sandwiches, steaks, tacos, pizzas, and salads.
Greg traveled for decades, he says, visiting bars, breweries, and gastropubs from coast to coast and overseas. He filtered what he liked and didn’t, and then sold his restaurants and invented Finney’s. The old Chicago speakeasy interiors showcase local communities, with vintage photos from each market, and create a vibe that’s appealing to wide demographics with a nod toward families.
But the larger point is, “value” wasn’t suddenly an inflationary-defying part of Finney’s DNA. The chain’s burger/tacos/sandwich offerings still start at $12, salads $13, and pizzas $14. Value is, however, helping the chain establish ground as it continues to expand.
Just recently, the brand closed a company record $18.5 million round of financing on the heels of its 10th store opening in Redlands. That will take it through four scheduled 2024 debuts (Stevenson Ranch, Oceanside, Claremont, and Goleta).
Brad says the Redlands venue turned out to be Finney’s No. 1 store out of the gate. En route to Palm Springs, it’s not the densest of markets, he explains. It compares, in some respects, to say, Fresno or Bakersfield, where the most common form of entertainment tends to be places to eat and drink. So Finney’s cut the ribbon with force, drawing in from massive populations in all four directions as a destination eatery.
More widely, Brad says traffic counts continue to lift across Finney’s. “They may not be spending as much, spending a little bit less,” he says of the economic climate. “But we’re getting more bodies in there than we did last year, which I know, in our segment of the industry is not very typical.”
Finney’s raised $5 million in equity financing through its core investor base and then closed a $13.5 million line with First Horizon Bank. Brad admits it was “pins and needles” for a few months due to the rocky world of investing right now, but the end result was a vote of confidence Finney’s plans to build around.
Regardless of where it heads, Greg says Finney’s commitment to value won’t slide. That was never the plan. What the brand simply couldn’t have realized a couple of years ago, he notes, is they’d have meals nearly in line with what it costs to order a Big Mac combo in California. Additionally, with how tipping evolved in fast casual in particular, by the time somebody orders a Chipotle burrito and taps the screen, they’re matching or surpassing what Finney’s offers, he says (there’s a $12 burger option). Not to mention tacking on a drink or chips.
“I call it food and a server in a great environment,” Greg says. “I think that’s where our advantage is. It’s a great experience for a similar price to fast food and fast casual. Others have elected to raise their prices in the past year, and we have just not done it. And you see it in our traffic counts.”
Over the past three years, Finney’s took some price on premiums, like salmon and tri tip. But it’s left many of its burgers, chicken, apps, drinks, salads, and other staples alone. Greg says the brand could raise the line but decided not to for a few reasons. Chiefly, it doesn’t want to drift from what customers have came to expect of the brand since 2016. But also, Greg feels it’s probable an economic downturn sits somewhere on the horizon. At the least, discretionary spending appears a delicate equation headed into 2024. “We’ll be in a great position to keep the guests coming through the door,” he says. “Even at hard times and especially in California.”
“I think you put that all together,” Greg continues, referencing nearby competitors and what they charge for similar items, “and it’s truly not rocket science to see that the value is there for the experience that you get.”
Finney added Ziosk machines to tables called “Finney Pay,” like the ones Texas Roadhouse deploys (“Roadhouse Pay,” in that case), where customers can checkout on their own terms. Brad says 300 or so comments flow through the system each week, everything from “best burger in town” to “love your pricing.” It’s only served to reinforce the mission.
However, Greg adds, the value proposition couldn’t hold up solely on price laurels. Since day one, the brand worked to instill repeatable culture. Greg says Finney’s invested in GMs, home office employees, kitchen supervisors, multiple benefits directors, all in an attempt to create a company of support. “My philosophy is happy team members equals happy guests,” Greg says. “And we work really hard at it—keeping people on our team happy. If I have a happy team, I know they’re going to treat the guest well.”
Finney’s then follows efforts with mystery shoppers to check if employees are hitting service points. Do friendly hostesses greet guests at the front within 10 seconds? Servers at the table within a minute of sitting down? Do drinks arrive within three to five minutes? “We follow all of this,” he says.
There are now roughly 800 employees across the Finney’s system. “We keep it solid and friendly,” Greg says. “And I think that permeates to our guests.”
Brad adds Finney’s model is for every guest to leave happy. That’s the quote the brand begins training sessions with. Customers are greeted with a “welcome to Finney’s” when they walk in, and they get the same outro as they leave. But it’s also a declaration that serves to remind employees they need to remedy whatever problem surfaces during a dining experience before somebody heads home.
Going forward, Greg says, Finney’s is on pace to open three to four restaurants annually. It doesn’t want to quicken the rate and lose sight of operations. Brad adds there’s still whitespace in SoCal to reach 20–25 units and 2024 and 2025 will center on core market development. Ultimately, though, Finney’s will look outside California.
Brad says, at some point, the brand would be interested in finding a growth partner that can help it hop borders, whether that’s through private equity or a strategic relationship. “We think Finney’s translates outside of the state,” he says, “but, obviously, we want to be very prudent. And once we do step outside, we want to make sure our first in-market is going to be our most favorable one.”
The Finefrocks aren’t sure where that will be just yet. It could be Texas. Vegas. Nevada. Arizona. Nashville. Whatever the choice, Brad says, Finney’s will be as methodical as possible so it avoids the cautionary tale of some regional chains that left their home bases and couldn’t translate. “We just want to be very pragmatic once we get ready to do that,” Brad says. “But I can tell you that the pickings are starting to get slim in California because we’re only looking at probably another 10 markets. Whereas a couple of years ago, we were looking at 15–20 markets. But we’ve taken up so much real estate that there’s just not a lot left.”