1. When casual goes fast
A look at five casual-diningrestaurantbrands experimentingwithfast-casual service
April 1, 2013 | By Erin Dostal
CLICKHERE
In the face of shifting consumer needs and a rocky casual-dining climate, many full-service restaurants are
creating fast-casual spinoffs or experimenting with fast-casual service styles.
While the move isn’t exactly new — many restaurant chains began heavy efforts around 2010 — it is an
increasingly used strategy, especially by brands looking to gain incremental traffic, reach a new customer
base or reduce the costs of development and labor. According Chris Miller, executive vice president at
foodservice research firm Sandelman & Associates, it’s also a strategythat makes a lot of sense.
About a quarter of casual-dining consumers say they are eating out less often, with 40 percent of those
consumers choosing to dine instead at fast-casual or quick-service restaurants, Sandelman research shows.
“There’s data to suggest that from a business standpoint, casual-dining chains ought to look at how to
counteract that trend.”
That doesn’t mean entry into the fast-casual segment is easy or fail-safe, he noted. Fast-casual brands like
Chipotle and Five Guys Burgers & Fries typically score high ratings among consumers for attributes casual-
dining brands hold dear, like friendliness of service, accuracy and food quality, Miller says.
“Fast casual has set the bar really high,” he said. “In order for a new concept to break in, [it] has to really
deliver on that great food and experience.”
Nation’s Restaurant News collected the recent efforts of several restaurant chains trying to make the move
to fast casual: Applebee’s Neighborhood Grill & Bar, Denny’s, Famous Dave’s, Red Lobster and Red Robin
Gourmet Burgers.
BetterBurgers
Red Robin Gourmet Burgers Inc. began developing its fast-casual spinoff more than two years ago, when the
company decided it should no longer miss out on the country’s booming fast-casual “better burger” segment.
Wall Street analysts were consistently asking the public restaurant company if it was getting hurt by rival,
counter-service chains like Five Guys Burgers & Fries or Smashburger, said Stephen Carley, chief executive of
Greenwood Village, Colo.-based Red Robin.

2. “The assumption was that all of these better-burger, fast-casual guys had to be taking their business from
somewhere,” Carley said — and it very well could have been poaching from the casual-dining Red Robin
brand.
So the company debuted Red Robin’s Burger Works, a fast-casual iteration that offers five of the company’s
signature burgers, shoestring-style French fries, salads, chicken tenders and milkshakes, beer and wine.
All items are ordered a la carteat Burger Works, giving customers greater flexibility in ordering, Carley said.
At traditional Red Robin locations, the fries and burgers are bundled.
Burger Works has five locations, with four in metro-area Denver and one restaurant at The Ohio State
University in Columbus, Ohio.
Although Burger Works is still “very much in a test phase,” Carley said, the brand is doing well. The spin-off
could potentially allow Red Robin to move into more nontraditional locations, as well as smaller-footprint
sites like strip malls and urban areas, Carley added. The number of full-service Red Robin restaurants totals
about 467.
“We’re taking a little bit of a break right now [from expanding Burger Works] as we evaluate how these
businesses are performing,” Carley said. “We think there is a tremendous runway for Red Robin’s Burger
Works.”
BetterBBQ
Famous Dave’sof America Inc., the Minnetonka, Minn.-based parent to the nearly 200-unit, full-service
Famous Dave’s, opened its first fast-casual BBQ Shack in December 2011 near company headquarters.
At three locations as of December 2012, the BBQ Shack brand has a fast-casual design where guests order at
a counter, take a seat, and are brought their food. Light waiter service, including having restaurant staff refill
drinks and bus tables, is also a part of the service style.

3. BBQ Shacks are smaller and cheaper to build than the casual-dining version of Famous Dave’s, said John
Gilbert, Famous Dave’schief executive, and they have great viability as take-out locations.
“What has become apparent with Famous Dave’s through a whole bunch of insights and research with our
customers is that we have a very, very strong dine-in business, and a very, very strong catering business,” he
said. Almost 40 percent of the company’s business, he said, is off premise.
Miller of Sandelman & Associates said BBQ Shack might have a market advantagebecause there is not yet
any other fast-casual chain in the barbeque segment.
“BBQ is a little bit of a less-developed [quick-service] segment,” he said.” So there might be an opportunity to
build a fast-casual component of it.”
Gilbert said Famous Dave’s is still tweaking the BBQ Shack platform, working to develop the best
demographic target and restaurant design.
“The good news is consumers have responded really positively so far,” he said. “It’sa dinner daypart
primarily, but clearly there aresome lunch occasions.”
Targeting audiences
By expanding into fast-casual territory, many companies seek to target consumers their traditional locations
wouldn’t reach.
At Denny’s Corp., the company has developed two fast-casual concepts, one called “Fresh Express” and
another called “All Nighter,” both of which aretargeted for college campuses. They first debuted in 2010, and
there are now 12 locations between the two brands. Standard, full-service Denny’s locations total about
1,680 units.
“What’s really interesting is that all of the fast-casual brands that are out there and are doing really well, they
didn’t develop their concept because they wanted to be fast casual. They developed their concept because
they saw a niche in the marketplace for what consumers want,” said Greg Powell, vice president of concept
innovation at Spartanburg, S.C.-based Denny’s.
The spinoffs that work, he said, will have to fill a niche — not just be quicker-service replicas of the
company’s existing locations. “You have to really make a leap that it’s going to be very, very different,” he
said.

4. While Denny’s fast-casual tests, which feature to-go items like the Grand Slamwich, a take on its signature
Grand Slam breakfast, have done well so far on college campuses, it is not yet decided whether the brands
will be expanded nationwide, Powell said.
Lunchtimeservicestyles
The most recent casual-dining brand to leap into the fast-casual niche is Red Lobster, which rolled out a
lunchtime test called “Seaside Express” at two Orlando, Fla.-area locations in March.
At the locations, guests can order at a counter and seat themselves — a fast-casual service style — or
continue to receive the original, full-service Red Lobster experience, officials said. The lunch menu consists of
a selection of sandwiches, soups and salads priced between $6.99 and $8.99 each.
“This limited test is designed for time-constrained guests who eat out for weekday lunch, and will help us
learn more about the opportunity to expand our lunch offering to guests who are looking for a faster, more
convenient casual-dining experience,” Heidi Schauer, a Red Lobster spokeswoman, said in an email.
The lunch test comes at a time when the 705-unit Red Lobster chain, part of Orlando, Fla.-based Darden
Restaurants Inc., is struggling. Despite having conducted a full menu re-do in October, Red Lobster has
reported same-store sales declines during the past several quarters. The lunchtime test is still very much in its
nascent stages, and Red Lobster hasn’t yet commented on how it will progress.
“There’s not really any clear seafood fast-casual leader,” Sandelman’s Miller said. “So this certainly could be
an opportunity.”
Applebee’s Neighborhood Grill & Bar is also hoping to boost sales at lunch by offering a fast-casual style,
speedier lunch service.
Dubbed Express Lunch, Applebee’s started testing at two locations in July 2012, and it now is part of the
service at about 23 locations. A kiosk within traditional Applebee’s locations offer Express Lunch options from
11 a.m. until 2 p.m. Guests order from a counter, pay and take a number. They then take a seat in the
restaurant and their food is brought to them.

5. “We have a very strong core business in dinner, our late night business has been growing very well over the
past couple of years. Lunch is the daypart where guests have special needs,” said Becky Johnson, senior vice
president of culinary and marketing at Applebee’s, a division of Glendale, Calif.-based DineEquity Inc.
The menu at express lunch features soups, salads and sandwiches, with a Pick ‘N Pair lunch combo starting at
$6.99. The goal is to get customers in and out in 30 minutes or less, if that is what the customer wants,
Johnson said.
“We’re going to continue to work on it,” Johnson said of the lunchtime test. “Assuming that the guest
continues to adopt the service model and assuming that the business case is there, we could certainly make
this work.”
Applebee’s, which is based in Kansas City, Mo., operates or franchises about 2,000 units.