Tech, data drive smokin’ sales at Dickey’s BBQ
Fast-casual shows no signs of slowing down. This year’s Top 200 is peppered with better burger chains like Five Guys at No. 75 and Smashburger at No. 210; wing concepts like Zaxby’s at No. 77 and Wingstop at No. 111; and of course Panera, the dominant concept in the category which again ranked No. 27 this year.
More than half of the fast-casual players’ sales outpaced their unit growth, some by wide margins. The widest margin was at Dickey’s Barbecue Pit at No. 192.
The 484 unit-strong franchise added 114 restaurants in 2014, a strong 30.8 percent unit growth. Systemwide sales, meanwhile, jumped from $215 million to $319 million, which at 48.3 percent can only be called meteoric.
Roland Dickey Jr., president and CEO of Dickey’s Barbecue Pit said their recipe is simple: “More stores and more sales in the stores.”
Of course, like barbecue, a simple formula can make something very special in the right hands. Dickey said two strategies especially helped drive growth.
First, Dickey cites call center-based catering at the home office. It takes calls nationwide and kicks out orders to local units. He said couponing through third-party vendors like Groupon, GrubHub and Postmates was another valuable revenue driver.
“We’ve been really putting together an organized program to drive sales through third- party sales vendors,” said Dickey. “It’s its own sales channel.”
Renewed training efforts and a new technology platform rolled out in 2014 also helped Dickey’s Barbecue Pit find new efficiencies in the menu and in the back office.
“We’ve invested about $1 million in this technology. We now have a world-class technology infrastructure called Smoke Stack,” said Dickey. “It provides analytics to our owner/operators about how to run their business. So instead of having to mine for data and having a void of data, they’ve got everything at their fingertips.”
He said he doesn’t want to use outdated technology.
“We don’t want to be the best in barbecue, because honestly that’s not a very high standard. We want to have the best technology in the industry,” said, Dickey, who eyes McDonald’s and Dominos as tech competitors.
Starting in 2014, every operator received POS analytics, data heat maps and new marketing connections with customers via that Smoke Stack system.
“It’s already helped us make some data-based versus emotion-based decisions on some products that have been around as legacy items,” said Dickey. “You’ve got to focus on the things that are moving and yank the things that are not.”
He said they have plans to retire more SKUs as they open their first fourth-generation store in 2015. The target is just under 100 SKUs.
As the concept hones its technology, format and menu, unit numbers continue to surge. “We’ve been doing about 100 a year,” said Dickey. “But by 2017, we’d like to step that up to 200 a year.”
He said they would also like to go international in a big way in 2017, with stores in the Middle East and across Asia.
As for all the pulled pork options across the restaurant industry, Dickey says it’s flattering, and helps bring visibility to barbecue—even if it’s not the best barbecue.
“I try to go out and eat every one of those LTOs as they come on line. Let me tell you something, bottom line, they all suck,” said Dickey who said pulled pork doesn’t make his competitors any more competitive. “What we do actually like about it is that it builds awareness about barbecue in general. And usually people gravitate from barbecue to good barbecue, and we’ll welcome them at Dickey’s for that.”