The Greene Turtle Sports Bar & Grille chain still believes in burgers. On Jan. 2, the 30-unit mid-Atlantic chain introduced a limited-time menu of four half-pound stuffed burgers: the Spicy Jack (stuffed with jalapeňos, pepper-Jack and Cheddar cheeses); the Pep & Cheese (stuffed with pepperoni, fresh basil and Provolone cheese); the Bacon & Cheddar (stuffed with smoked bacon and Cheddar); and the Ham & Cheese (stuffed with smoky pit ham and Swiss cheese).
BurgerBusiness.com spoke with Greene Turtle COO Bob Barry about the chain’s vote of confidence in burgers at a time when many others are instead promoting chicken.
BurgerBusiness.com: I predicted that 2011 would be the year of the stuffed burger and it just didn’t happen.
Bob Barry: You were ahead of your time, my friend.
Unfortunately so. But tell me why you decided to make stuffed burgers the focus of Greene Turtle’s menu this year.
Back in September we started thinking about what we could do with the menu in 2012. Typically we do a new menu in April or May. For the last few years we’ve augmented that with limited-time offers that we hope will keep things fresh. Most of the time we do standard things, you know? Usually one from each category: an appetizer, a sandwich, a burger, an entrée and a new dessert for the LTOs. But we started looking around and watching what the burger trends were on your site and on Food Network and elsewhere, and we started scouting the opportunities.
What are you looking for? Are you trying to ride the trends or go beyond them?
We want to be unique. We started talking about big sandwiches and grown-up grilled cheese and we said, “hey what about stuffed burgers?” It led us to doing some more research and play around, and we narrowed it these four. We thought they were different. I know a lot of independent burger places do stuffed burgers, but no regional or national chain was launching them. We felt they gave us a unique position and an identity that’s fresh and different.
And then you took it to your beverage menu, which is a great idea.
Yeah, we wanted to push it and take it a step further. We talked to some of our beverage suppliers and they said that a lot of people are doing things with combinations of craft beers and spirits. We started playing with some ideas with that, too. So one side of the LTO has the stuffed burgers and on the other side are what we call our stuffed beers.
How does a stuffed beer work?
Well, we’ve got a Pennsylvania OJ that has Yuengling lager with Smirnoff Orange vodka and orange juice. Another is the Irish Float with Guinness, Bacardi Oakheart Rum and vanilla ice cream topped with chocolate sauce. The Royal Stella is Stella Artois, Crown Royal and Smirnoff Blueberry vodka. We’re doing some unique things and we’re having fun.
How have your customers responded?
In our first week of sales, total burger sales were just under 14,000. That’s regular and stuffed. But 65% of burger sales were stuffed. That’s a great response.
What’s the early winner among the four stuffed burgers?
Right now, the Bacon & Cheddar is leading the pack. The Ham & Cheese and Pep & Cheese are doing well, too. The Spicy Jack is probably a little behind the others initially but it’s spicy and it may take a while to find its audience. But they’re all doing fine.
Those sales are strong enough that you must be thinking, “Hey, we’re scheduled to take these off the menu on March 26!” Can you afford to do that?
Yeah, I just met with my VP-marketing yesterday and we’re thinking that if these continue to go in the direction they’re headed, we’ll change plans a bit. Our [initial] plan was to launch the new menu somewhere around May 14. Now the thought is that after March 5, we’ll categorize them as the final four—there are only four them anyway, of course—and have some fun with a March Madness promotion. We’ll ask which one of the stuffed burgers is going to win. We’re thinking that after April 2, we’ll continue to offer the two top sellers. We’ll say we’re continuing to offer the champion and the runner-up until our new menu comes out. The plan then would be to continue them onto the new menu.
Sounds like a good problem to have: If you have to change the new menu already at least it will be because sales are strong.
I’m hoping they’ll stay strong. The newness of the stuffed burgers is bringing people in, and we used social media to promote them at a $5.99 price for the first three days instead of $9.99. That helped. It will be interesting to see if sales stay strong.
Some operators have shied away from promoting burgers because of high beef prices. How do your food costs look this year?
We did a good job working with our burger supplier before we launched this campaign. We negotiated a 6.5% price increase [from a year ago] for 2012, but at first they were talking prices that were in the mid to high teens [above last year], so I feel pretty good about a 6.5% rise. We try to lock in beef prices for the year in January, so before we went ahead with this we had to settle on cost.
I think we’ve priced the burgers reasonably. You’re looking at 8 oz. of beef and 4 oz. of what’s stuffed in the middle, so it’s a 12-oz. product with our kettle chips and all and it’s still under $10.
How price-sensitive do you feel your core customer is now? Did you feel you needed to stay under $10?
Last year was the first time we broke the $10 barrier on a burger. We did a Philly with cheesesteak on top of a burger, and a Chesapeake with crabmeat on top of a burger, and they were $10.49. They were at the top of the price pile before and sales were soft, and that’s still true.
Our customers are certainly watching what they spend. Our competitors are trying to stay under $10 on burgers so we are too. One of the challenges is trying to keep menu prices low while giving a great product, great experience and great service. Otherwise you risk consumers waking up and saying, “You know, I can get a pound of ground beef and rolls and make hamburgers at home for less money.” What we do is about the experience. That’s one of the reasons the stuffed burgers are so important to us: It’s not like what you’d make for yourself at home.
You don’t think consumers are quite at the point where high prices keep them at home?
Oh, I think we’re getting there. The industry’s feeling a little pressure on the Monday, Tuesday, Wednesday business. Consumers are watching their dollars. The number of times they go out to spend on a meal has been reduced. I tell my team we have to give a unique product and great service. Every time. If we do that, we’ll get a fair share of however much is spent.
But you have to watch your margins, too, don’t you?
Absolutely. Margins are getting tighter. We did a good job in 2011 over 2010 on holding costs. Our product-usage cost was down from the previous year. Part of that is a slight menu-price increase, part is trying to redirect positions on the menu. And part was doing a good job managing waste and controlling operations. We’re working a lot harder that we did a few years ago.
A lot of chains seem to took menu-price hikes in the 3% to 5% range over the course of last year. Is that where you were?
Yep. Our target was around 3% last year and we’re going to try to keep it as low as we can this year. On some things we may have to eat some prices, but you keep an eye on the menu as a whole to balance your costs.
It must make menu planning more difficult.
Oh sure. Our new menu’s not set yet. We’re still looking; still thinking; still watching prices.
Will there be more chicken than in the past to help food costs? That’s a common solution lately.
No, we’re keeping the burger category strong. Burgers are still a key part of the concept. We might even increase that category if the margins allow. The stuffed burgers tell us the category is strong. When people go out, they want burgers.
Are you hoping to build alcoholic-beverage sales?
Not really. Our mix is good, I think. We’re higher than most on the beverage side just because of the nature of how we started [as a sports bar concept]. We do about a 65/35 food-to-beverage mix and that’s good for us. Beverages give us a higher margin, but we’re also looking to build family business.
Your stores are all in the Delmarva region now, correct?
Correct. We have 30 locations open in Delaware, Maryland, Virginia and D.C. Of those, 13 are company-owned and the rest are franchised.
Are you looking to expand up or down the coast?
We are. We’re looking in North Carolina and in negotiations with a developer for New York, specifically Long Island. We have an interested party in western Pennsylvania. But our strategy still is to stay within a 250-mile radius of our corporate office in Edgewater, Md., just west of Annapolis, at least through 2012. Then we’ll see where we are. Financing has been difficult, but we’ve been creative and managed to grow in tough times. We hope things will loosen up, and we intend to keep growing.