Multi-concept operators, those companies that have a number of restaurants under one corporate umbrella, are said to be gaining the benefits of being in both worlds. MCOs, which own at least three distinctive restaurant concepts and operate with annual sales incomes of $10 million or more, are able to capitalize on the competencies and wide scope of chain restaurants, while also benefiting from the menu flexibility and local support of independent restaurant operators.
Giant MCOs Wolfgang Puck Companies, Levy Restaurants and Lettuce Entertain You, as well as those with smaller operations like Cincinnati’s Tavern Restaurant Group, Denver Sage Restaurant Group and Kalamazoo’s Millennium Restaurant Group, may not control a market share akin to America’s biggest chains, but they apparently still take up an essential niche for foodservice distributors and suppliers. One hundred sixteen of the top 200 Multi-concept operators have yearly sales of at least $30 million, totaling to overall revenue of more than $5 billion. The top 200 MCOs today are comprised of 1,448 concepts and 2,367 units.
This success was brought about by a number of trends that emerged these days,” say Mary Chapman, Technomic director. “Many celebrity chefs have surfaced in Food Network, and these have paved way to a strong and enthusiastic customer base for the concepts. Such concepts are flexible in nature, able to present seasonal menus in stylish menu covers and concentrate on local relationships that make the dining experience unique to customers. This proved effective, although the consumers are not even aware of the correlation between the concepts – they may only think of these restaurants similarly to how they conceive the other independent chains in their area.”
Chapman also emphasized that MCOs can swiftly rebrand units, develop unused space within a specific concept to introduce a latest brand, or easily modify the distribution of resources between brands so as to keep up with industry trends.
Another success factor of multi-concept restaurant operators is their ability to cater to a wide range of demographic groups, being able to offer different cuisines in their menus in elegant menu covers, and ambiance. The Wolfgang Puck companies, for example, has a fine dining group, a catering division and a third group which operates their bistros, cafes, bars and grills. Spago, Cut, Chinois, Postrio, The Source, among many others, offer imaginative, sophisticated and seasonal cuisine which caters to fine-dining enthusiasts who are willing to spend their money on good dining. Their Wolfgang Puck Bistro and Wolfgang Puck Express, on the other hand, are more into casual dining.
The same goes for Lettuce Entertain You Enterprises, which now has approximately 70 restaurants that accommodate different kinds of diners across the country. They catered to young singles interested in casual and healthy food in 1970, and slowly embraced diverse styles of cuisine over the course of time, and have developed a variety of concepts.
Levy Restaurants operates more than 100 foodservice outlets in various markets throughout the country and nearby Canada, targeting different markets for their fine dining services and their different food facilities in conventions, concerts, performance venues and arenas for all major sports leagues.