Inspire Brands CEO Paul Brown touted Alliance Kitchen in his keynote address yesterday, its new virtual kitchen in Atlanta that houses five of its seven restaurant brands including Arby's, Buffalo Wild Wings, Jimmy John's, Sonic Drive-In and Rusty Taco. (Dunkin' and Baskin-Robbins, Inspire's most recent purchases, are not yet included.)
Alliance Kitchen allows the brands to test ideas from its Innovation Center. "Our objective is, let's use this as a way of how we merge the back of house as much as possible, to get the most efficiencies. We use it as a learning lab," Brown said at the Restaurant Finance & Development Conference on November 9. "You don't know unless you try."
The kitchen is also experimenting with a robot called Flippy, "or we call him Wingy, that's another innovation, that we've been working in partnership with Miso Labs on, and we're pretty excited about it," Brown said. "Let's do it with the most complicated fry station you can imagine, which is a Buffalo Wild Wings. It's not just to reduce costs, but also improve the experience of the staff members," since the fry station "is not the favorite."
Inspire's digital sales have more than doubled since 2019 to just over $6 billion, according to the company. Venture capital investors poured $3 billion in the virtual kitchen/ghost kitchen space in more than 50 deals in 2020, according to PitchBook.
The Alliance Kitchen design reduces labor needs by 54 percent, square footage by 19 percent, equipment costs by 45 percent, and reduces energy consumption by more than 50 percent compared with five stand-alone restaurants, according to Inspire.
John Hamburger, publisher of the Restaurant Finance Monitor who interviewed Brown on stage, asked if 2020 was the most challenging environment ever for restaurant operators.
"I thought 2020 was the toughest, but I'm not sure. 2021 is giving it a run for our money. It's causing us to be a lot more agile. If you come into a year and you're going to work the plan and you're going to land the plan, I think that is gone, certainly gone this year and next year," Brown said.
He gave an example. "At one point last year, at Buffalo Wild Wings, we were operating under 900 combinations of rules and regulations across the U.S. You can't do centralized command and control that way, you have to drive decision-making into the organizations, which helps us," he said.
"The sales line has been phenomenal across all of our brands. But like every other operator in this room, it has come with challenges around labor, challenges around supply chain. It has come with challenges of our general managers are 18 months into this., and how do you keep them excited?"
Hamburger asked if Inspire was planning to buy other brands. "We are $30 billion in system sales, 32,000 restaurants. We've made five acquisitions in three years. We're good," Brown replied.
Hamburger shot back: "Thank you for that non-answer." Read about Inspire Brands' acquisition of Dunkin' and Baskin-Robbins here.
The Restaurant Finance & Development Conference ends today at noon, and is followed by the Food On Demand Conference, opening at 2 p.m. November 10-12 at the Bellagio in Las Vegas. Read conference coverage here.