Concept restaurants continue to boom

Toronto-based sir corp, owners of the Jack Astor’s and Papa Leoni’s restaurant chains, is expanding its stable of theme restaurants based on a healthy economy and consumer demand for more casual, mid-priced meal solutions.

The company has just signed a deal with Perkin’s Restaurants in the u.s. to open 10 Jack Astor’s in the States this year, adding to the chain’s current 12 locations in Canada and four in the u.s.

sir corp operates a total of 33 restaurants based on 10 different concepts, two in the true ‘eatertainment’ segment – Jack Astor’s Bar and Grill and the newest one, Papa Leoni’s Italian Kitchen. All, says the company, are ripe for expansion.

Mark Weisbarth, president of Due North Communications in Toronto, researched the industry for sir corp, which he calls one of the major players in the business. He says ‘eatertainment’ is one of the latest trends is the mid-price category, one defined by a dining experience that is a destination in itself, rather than a restaurant you go to on the way to another destination.

‘The emergence of Planet Hollywood and that type of thing certainly is the leading edge,’ he says. ‘People don’t just want to have a dining experience, they want a whole entertainment experience.’

He says the move to casual sit-down dining at a reasonable price point spans all age groups and can be attributed in part to a general lifestyle trend toward ‘casual’ products and servcies.

Consumers would rather spend their disposable dollars on dining out more frequently at mid-priced restaurants, he says, than occasionally at more expensive ones.

Ian McIntosh, director of marketing for sir corp, says the ‘eatertainment’ concept – where a theme is carried from the curb, through the decor and menu, right through to the staff who interact with guests in a role-playing way – really started as a response to the fast-food dining experience.

‘People are wanting more for their food dollar than filling up fast and getting out. The baby boom has been desensitized to that – they were brought up with it – and there’s nothing new in it,’ says McIntosh.

‘They want to go out and spend a little longer at the table and maintain a relatively reasonable expense pattern.’

Unlike its competition, sir corp does not franchise its restaurants. It enters joint ventures with investors who have the option to be a silent or participating partner, while sir corp manages all the locations for consistency and quality control.

Some of the other sir corp brands include Armadillo and Walt’s Grill and Bar, with four and six storefronts respectively in Ontario. It also operates several concepts with just one or two restaurants in downtown Toronto, the newest being the Canyon Creek Steak and ChopHouse and Papa Leoni’s.

Figures from the Canadian Food and Restaurant Association (cfra) indicate that licensed restaurants will grow by 5.9% this year. Only the takeout or delivery category is growing faster, with expected growth of 6.4%.

sir corp’s competition in the concept-restaurant business in 1996, according to figures published by Foodservice and Hospitality magazine in July 1997, was led by Cara Operation’s Swiss Chalet chain with $295 million in sales. u.s.-based Darden Restaurants, operator of The Red Lobster and The Olive Garden chains, was second, with $187 million in sales. Prime Restaurants, which operates East Side Mario’s as its flagship brand, was third, with $160 million. sir corp was seventh, with sales of $74 million.

There has been some consolidation of the industry since those numbers were tabulated with the disappearance of Darden Restaurants and Cara’s purchase of the sixth place company, Vancouver-based Spectra Group of Great Restaurants.

McIntosh says by not expanding to 200-store chains and keeping the brand exposure small, the company can stay nimble and tune in to a new niche or trend.

The concept business is cyclical, he says, and a hot trend is bound to cool, so he says sir corp doesn’t want to have all its eggs in one basket.

No matter how brilliant the concept, however, McIntosh says nothing beats a good location.

He says sir corp learned its lesson the hard way. The company opened a Jack Astor’s in Rochester two years ago in a poor location and mistakenly decided to compensate by putting all the savings in rent toward marketing.