FreeRange Concepts CEO and cofounder Kyle Noonan talks about translating experiential dining to the home, why off-premises is here to stay, and what the restaurants look like now that they’re reopening.
Full-service restaurants have clearly been hit by the coronavirus pandemic much harder than their limited-service counterparts, as they’ve lost one of the pillars of their business: the experience of dining in the restaurant. But many have successfully found ways to pivot and deliver a high-quality experience to guests’ homes.
FreeRange Concepts is one example of this. The Texas-based operation, which owns 11 restaurants among four concepts—Bowl & Barrel, The General Public, The Rustic, and MUTTS Canine Cantina—is known for its dine-in experience, which in many cases includes live music and, for MUTTS, a dog park. And rather than close the restaurants and ride out the COVID-19 outbreak, says FreeRange cofounder and CEO Kyle Noonan, the leadership team decided to stay open and instead translate that experience to the off-premises model.
Noonan talked with Food News Media editorial director Sam Oches on the “Fast Forward” podcast about what that process looked like, how off-premises is likely to stay an important part of the FreeRange business, and how the restaurants are adapting now that Texas is starting to open up its economy and allow dining rooms to open at 25 percent capacity. Below is an edited version of the conversation; stream the full conversation above.
Why did you decide to keep the restaurants open? And how did you translate that experiential component of your restaurants?
My partner and I talked, and obviously it was a scary day when we were having a close our doors. We went back and forth and said, “Do we just save every penny we have, close it down, and just try to reopen when we can?” That was obviously the route that we could have taken. But ultimately, we felt like in times of crisis, one of the most important things you can do is lean on each other and bond together as a team. And if we all just kind of quit and go sit at home, you lose that. So we wanted to keep our team together and just ensure that we have a cohesive unit still with a sense of purpose. Eventually, when the world does open back up, we don't want to have to start from ground zero again. We wanted to already have the momentum in place.
Then also, part of the decision is, frankly, our team members are considered family to us, and I want to take care of my family—my immediate family, but I also wanted to take care of my work family. And the idea of just everybody going home and losing their jobs was not palatable to myself or my partner.
We decided to bring as much of an experience as we could through the to-go process. We decided, people are trapped at home, people are bored, people are hungry, so why not create videos? We created a video called “Kyle’s Kitchen,” and recipe cards and kits that, if you live in one of the cities that we’re located, you can come up to one of our units, pick up the meal kit, pick up a cocktail kit, then go home and we all cook together on Instagram Live. So we kind of have a group cooking class.
Then we took it a step further because The Rustic in particular is known for food and drinks and live music. And I've had one of our artists—who are also out of work right now—come over, set up a guitar and a microphone in my backyard. I have a large backyard. They set up a little stage and do a livestream concert, so you can get the food, you get the drinks, you get the music, and that's ended up doing really well. It’s a way to bring a little bit of The Rustic in your house.
Ultimately in the hospitality business, we’re servants by nature and we want to serve our community. So we looked up and said, “You know what? The restaurant industry has it bad. But the health-care industry is getting crushed right now in different ways than the restaurant industry is.” So we decided, “How can we help the health-care workers?” And so we started a one-for-one program where if anybody buys one of our famous entrées, the Hot Chicken & Cheese Sandwich, we’ll donate one to a health-care worker. We're dropping off sandwiches to local hospitals. And so far, we've dropped off over 4,000 sandwiches. So both from an experiential standpoint, but also from a charitable standpoint, serving our community has been one of the things that has proven to be successful for us, both from a business model standpoint, but also—and more importantly—it gives our team a sense of purpose and something to do.
What do you feel like you've learned in the process of doing this? What do you think you're going to take with you and the brands into the future?
One thing in particular is that we do have a revenue stream that wasn't there before, and that's the curbside take-out and delivery model. It’s a real business, and I do think that it's here to stay. Even when things get back to quote-unquote normal, I think that the brands that are executing curbside or delivery well right now will see that revenue stream remain into the future.
When we first started doing the pick-up curbside, it was like a scramble to try and create something, and we thought it was just going to be a couple weeks and then we're going to get back to normal because nobody really knew what was going on. And then after about a week, we said, “You know what? This is actually a real thing. We need to look at this and engineer it to be a long-standing business model and not think of this as a kind of Band-Aid for right now. Let's look at this as, OK, we're going to do this, and we're going to keep doing it. So how do we do it well and how do we invest in it?”
I think that redesigning restaurants or the way we design restaurants moving forward will change to allow for the curbside-delivery model. I've even talked to full-service operators that have said we might consider just putting a drive-thru window in and just have that as an option. Because the fast-food operators are seeing a small decline. Some are up. So that can be a model going forward if, God forbid, something like this ever happens again and we just switched to that drive-thru model.
Now that Texas is reopening and allowing some dine-in business, what does that look like for FreeRange Concepts?
It’s only 25 percent of dining rooms, so 25 percent of your occupancy is what's allowed. When you look at it from a business-model standpoint, no restaurant ever opens up with the idea that 25 percent of their capacity is going to work. The economics aren't there. I know that a lot of restaurants are still choosing to stay closed just because it isn't financially worth it to them to open up at 25 percent occupancy.
Us, on the other hand, we have large spaces and large outdoor patios. Most Rustics, for example, are 2,500 people [occupancy]. And so when you do 25 percent of that, you still have several hundred people that you can get in. You have to spread way apart, which we have the real estate to do in the outdoor spaces predominantly. Which is nice, because that is just a little bit safer to be outdoors than a small, confined [room]. The 6-foot social distancing is something we're taking to 10 or 12 feet between tables. There's plenty of space between everybody. We're not allowing anybody to not be at a table—so for example, no bar tops. You can't go belly up to the bar and order a drink, there’s no way to safely social distance.
We're in a unique position because we are large, so we can open and it still make financial sense for us. I anticipate being very busy. The hardest part is going to be crowd control and keeping people out of the restaurant until their seats ready. We’re going to be hungry to be outside, sit on a patio, get a margarita. I’ll be interested to see how many of the consumers wear masks. It's not required in Texas; it was required for about a two-week period, but they lifted that requirement. Our staff will be wearing masks and gloves, but we're not requiring the guest to.
If you have to get up to go to the restroom or something, we have what we’re calling a “butler service.” We have attendance at the restrooms and at the front door, opening doors for guests. You don't even have to touch the door handle. And that person will be responsible for just the friendly reminder that if there's a line to the restroom, just make sure you stay 6 feet apart, proper social distancing.
What do you think the recovery looks like for restaurants?
The good thing about the restaurant industry as a whole is this is not a foodborne illness. That eases a lot of fears. But also, the restaurant industry has worked hand-in-hand with local, state, and federal health agencies for decades, making sure that we run clean, sanitary, healthy, safe environments, and protect our employees and our guests. So we're already pretty good at this, at running sanitary businesses, versus a lot of retail stores. They're not used to having to do deep cleans and things like that that are just part of our routine and part of our culture as an industry.
It will be interesting to see the consumer response and how quickly it takes to rebound from this. I think there are two sides that we’re watching, and none of us really know what's going to happen. There's the safety side of it and the comfort that the guest and the consumer base feels going out—what their comfort level is from a sanitary and safety standpoint. But then there's the financial standpoint; if the economy can rebound quickly and we see a V-shaped rebound, then I think we'll get back to late ’19, early 2020–type business pretty quickly. If this thing drags on for another six months, and the economic recovery is a lot longer, then you're going to see a big shift, and I think without a doubt, value will always be paramount.