last edited: December 7, 2011, 9pm [added recommendation on beer & wine]; also edited on December 13, 2010, 1:05am [improved a few poorly worded sentences]
I’ve noticed several franchised “Urban Flats Flatbread & Wine Co.” closing this year in the southeast, such as Orlando FL, Winter Park FL, Lawrenceville GA, and Atlanta GA (pictured to the right). Something clearly isn’t resonating with potential and repeat customers. Many franchises suffer from this ‘surprise’ problem leaving execs scratching their heads about what is going wrong. I’ll put on my pundit hat and give you my opinion and recommendations.
HOW RESTAURANTS ARE JUDGED BY CUSTOMERS:
People will instinctively judge a restaurant on three elements, and to draw repeat business you need to excel in at least two of these (and be at least average in the third) in the eyes of your local customer base:
- FOOD: Is the food memorable and superb all around?
- PRICING: Is the pricing at or below the competition; does it provide value?
- AMBIANCE/EXPERIENCE: Is the customer experience superb with a unique and comfortable interior design?
A restaurant could succeed by satisfying only two of three criteria. For example, you could provide an excellent customer experience and have great food, but prices are too high. Cheesecake Factory and J. Alexanders are examples of this but both still generate excellent sales.
HOW URBAN FLATS RATES:
According to most of the reviews I’ve read online, Urban Flats rates as follows:
- FOOD: Average food, flats are minimalistic…not bad but not excellent either
- PRICING: A bit high – $10 cheeseburger, $8.50 Loaded Potato appetizer, $10 “flats” pizza
- AMBIANCE/EXPERIENCE: Average, some described it as trying too hard to be cool. Music is too loud to talk. If you have to describe your restaurant as hip in advertising, you probably are not.
Other repeat comments are that visitors expected a walk up ordering counter and self seating, but it’s a sit down wine bar. The menu is surprisingly diverse for a “flats” restaurant. It showcases very high end salads and entrées ranging from salmon and tandori chicken. People understandably describe the “flats” as “pizza” even though there is no mention of pizza on the menu.
Also see: Urban Flats Menu
FIXING THE BUSINESS
I could see this concept get on the path to profitability by switching to a limited menu of “flats” priced at the fast casual norm of $6-$8. And, only selling sides that support the “flats” sales such as salads. The service style should be fast (under 5 minutes to receive your order) and be located in storefronts where you’d find fast casual restaurants like Panera Bread, Go Roma, or Noodle & Company.
Ditch the waiters and table service, ditch trying to be a hip bar. Ditch the menu items that do not support the “flats”, shrink your footprint to under 3,000 square feet. Make the seating comfortable to individuals and groups. Try to infuse “authenticity” into your brand story, focus on the unique “flats”, don’t fight the pizza comparison. Hire a new chef consultant (you need outside unbiased help right now) to restructure the menu, and rework foods to get the food costs well under 30%. Hire an experienced research firm to test and improve the menu (email me if anyone wants research firm recommendations). Let the chef consultant work closely with the research firm for best results. Since stores already have bars and liquor licenses, have a couple of low-cost wines and decent draft beers with the pizza, but I’d drop the hard liquor permits if possible and just do beer and wine. Flipper’s Pizzeria and Go Roma do this successfully while keeping it family friendly. You may be tempted to go the sports bar route but I wouldn’t recommend it in this instance because you’ll get lost in the shuffle as most sit down pizza places already pseudo try that.
Currently, there is little unique about Urban Flats other than their “flats” pizza. Luckily, there is a market void for quality under-5-minute pizza restaurants (Red Brick Pizza is currently trying to exploit this niche with high-temp stone hearth ovens that cooks pizza in 3-4 minutes…I’ll do a review of Red Brick Pizza soon because I think they’re screwing up too). If I owned Urban Flats, I’d bet the farm on branding the restaurant entirely around the “flats”. Try being more kid friendly with the menu and seating in your suburban locations and you’ll get many more of the coveted large family groups. Gimme’ a combo that includes a flat, salad or side and drink for $10.
The foundation and sole goal for this turnaround is getting people in the door, returning every week, and encouraging their friends to check it out. Once customers consistently fill the seats and gross sales are high enough to at least reduce prime costs under 60% and rent under 10%, then owners/managers can pontificate on increasing profitability by increasing average liquor sales, optimizing labor schedules, table turnover times, and getting their friends posh jobs at the bar.
As I write this I’m reminded of the reality show “Kitchen Nightmares” starring Chef Gordon Ramsey. Ramsay doesn’t come out and say it but his formula for saving restaurants from bankruptcy hinges on fixing the three criteria above. He (1) reduces the complexity and size of the menu, (2) reduces the prices to encourage repeat business and match competition, and (3) remodels the interior design and employee’s attitudes.