September, 2009
By Jami Curley
Across the country, the restaurant industry is rife with household names that got their start right here in Georgia. From Zaxby’s and Waffle House to Chik-fil-A and Atlanta Bread Company, Georgia has long been the birthplace of restaurants that offer diners beyond its borders a taste of the fresh, homey cooking that defines the South, at prices that place the experience firmly within reach of the purse strings of any consumer.
Now Georgia, and the Atlanta metro area in particular, is proving it has the stuff to be attractive to upscale restaurant concepts and familiar chains seeking to expand their names and try out some fresh ideas.
Celebrity chef and host of TV’s Top Chef Tom Colicchio chose Atlanta as a premium location for the expansion of his Craft fine dining restaurants. In 2008, he opened branches of Craft and Craftbar (a somewhat more relaxed expression of the concept) right next door to one another in the Mansion on Peachtree in Atlanta’s Buckhead area. In the same year, celebrity chef and restaurateur Jean- Georges Vongerichten, through his relationship with Starwood hotels, brought the Asian-inspired Spice Market concept and the broader menu of Market to the W hotels in Midtown and Buckhead, respectively.
While the two restaurant moguls have somewhat different approaches to food, the climate of Georgia’s capital city is proving ripe for sustaining vibrant outposts of each of these sweeping fine dining empires.
A crucial element in a successful expansion effort is the placement of personnel. The name behind the name brand cannot be everywhere at once, and so, to ensure that the standards of the brand are upheld to the highest degree, the selection of a representative can make all the difference. Chef Colicchio chose from among his staff Chef Kevin Maxey to head up the Atlanta Craft and Craftbar kitchens, relocating him from a three-year stint at Craft in Dallas. Though a recent transplant to the Atlanta market, Chef Maxey has an intimate knowledge of the Craft concept and its brand standards.
“At Craft, the concept is the menu,” says Chef Maxey. “The entire menu exists as a result of localization.”
Chef Vongerichten, on the other hand, selected a local legend, Chef Ian Winslade of Bluepointe restaurant fame. Chef Winslade has been prominent in the Atlanta restaurant scene for the past 15 years, and uses his unique insights into the ebb and flow of the restaurant business in Georgia to guide Atlanta’s versions of Spice Market and Market to success.
“Atlanta has always been considered a capital of the Southeast,” Chef Winslade says. “A lot of people gravitate here to be in a metropolis. I think of Atlanta as a regional food hub. I think we’re on par here with Chicago, even Los Angeles.”
At the same time, more traditional franchisers, such as the Baskin-Robbins Corporation, are also finding Georgia to be fertile ground for growth, with more than 60 new stores planned for the Atlanta area and surrounding regions. The new stores are part of a much larger expansion plan for the entire Southeast.
“Atlanta and Georgia overall are very strategic crossroads in the Southern market,” says Salman Siddiqui, Vice President of Global Business Development for Baskin- Robbins. “We are solidly in the Virginia and Washington, DC, area, but creating a strong presence in Georgia allows us a base to expand further south into Florida and westward into Alabama.”
Baskin-Robbins is also cautious to select excellent candidates for its franchises. Managers provide potential franchisees with every opportunity to ask questions and work closely with them through business and marketing plans at the outset of the process. But after the discovery phase, there comes the financial review to ensure that new members of the franchise family are not going to scoop up more debt than they can lick.
“Financial review is used to make sure that the investment you are trying to make has a good likelihood of going through, that you will really be able to [succeed in] the business that you are getting into,” says Siddiqui.
Georgia’s climate also plays a part in attracting the big players in the restaurant industry. The long growing season and burgeoning green market scene are proving to be key assets as restaurateurs continue to develop their commitment to localization, organics and greening practices.
“The restaurant scene is amazing here,” says Chef Maxey. “There seems to be a good growing climate, and there’s just a lot of beautiful produce and great local products.”
“In the last six to eight years, there’s grown up a big organic movement now in Georgia,” says Chef Winslade. “With so many good products available, and [the fact] that you can get [ingredients] fairly reasonably and quickly, those are the main reasons the food scene has really exploded here.”
“Georgia, Florida, this is the warm belt. This is where our customer base lives,” says Siddiqui.
In addition, as the population of Georgia and metro Atlanta has become more diverse and well traveled, they begin to demand new and more interesting dining concepts.
Fresh ingredients, new flavor profiles and new preparation techniques are not only welcome, but also sought after, making it much easier to unveil a Southern outpost of a multistar dining experience once only available in New York, Chicago or Los Angeles. Very few changes need to be made in the cuisine to accommodate the local palate because the local expectations have grown so much broader.
For Chef Maxey, it’s all about technique. “We see product that is really nice, and that is what drives the menu. In New York, we might get a really great covolo nero [a black Tuscan cabbage]. Let’s say we braise it, get a sweet-savory flavor going on it. Well, down here we’ll take that same technique and apply it to a more local product, like a kale or or spicy red mustard green.”
“This city has grown immensely in the last 10 to 15 years, and it has a more diverse population with a more discerning palate, as regards to when, what and how they want to eat,” says Chef Winslade.
His adjustments to Spice Market’s concept are limited to slightly decreasing the level of heat in the menu. “People in the South are a bit more scared of spices, perhaps. Once they are introduced to it [at Spice Market], I think they accept it’s not going to bite your head off; it’s more about the flavor. But I think people here are more receptive than ever to a concept like Spice Market.”
A June 2009 report issued by the National Restaurant Association showed a general optimism in the overall outlook of the industry, with 34% of operators expressing expectations that conditions will improve within six months. And despite a statewide economic slump in which the current unemployment rate in Georgia hovers around 10%, there are signs that the restaurant industry here is holding its own.
According to figures from the Georgia Department of Community Health, the number of new foodservice permits issued for 2008 are only down about 3% from 2007, when 2,750 permits for new foodservice were issued, the highest figure for the previous five years. Still, expansion into Georgia is not without its challenges, especially in this economy.
“There have been signs things will improve, but the year to date has not been stellar,” says Chef Winslade. “We’re 10+% off, so it’s significant. We’re feeling it, but then so is everyone in our business.”
“Fortunately, with demand being down across the board with a lot of goods, food prices have been fairly low to consistent with what they had been,” says Chef Maxey.
With Craft and Craftbar occupying the same space, Chef Maxey feels they are succeeding at servicing customers across a variety of price points. “This economy makes us cautious, of course. We’re watching our controllable expenses very carefully. We have had a bit of a slowdown this summer, but people keep telling us that that is normal for Atlanta.”
The uncertainty of the current times can make the idea of expansion or franchising seem unrealistic, but there are encouraging indicators for small businesses that are thinking of taking the plunge. Most large franchisers offer some help with locating stable loan sources.
“In a tough economy,” says Siddiqui, “banking standards are tougher, so it is harder to get qualified for loans. People coming into our system find that we have relationships with banks who understand our business models.”
A financial institution that understands the ins and outs of a proposed franchise is going to be more willing to extend a loan. Also, because demand is down, the prices of many elements are open to negotiation.
“If you can afford it,” says Chef Winslade, “I think this is the optimum time [to expand] because you can get everything at a discount. Restaurant space is very reasonable; people are willing to make deals with you on construction. Now is the time, because the signs point to us pulling out of the recession. If you can get in cheaply now, I think in six, eight months, maybe a year, you are going to be sitting on a great place.”
“Instead of keeping money in reserve funds or stocks, they can put that money in their own stores,” says Siddiqui. “If they pick the right site and have a franchise with marketing power behind it, this can be a strong and compelling proposition for them.”
Restaurants New To Georgia
From upscale to fast food, more and more restaurants are moving onto Georgia turf. Here are a few of the more recent ones:
Craft: 3376 Peachtree Road, Atlanta, (404) 995-7580
Other branches: New York, Dallas, Los Angeles
Craftbar: 3375 Peachtree Road, Atlanta, (404) 995-7580
Other branches: New York, Los Angeles
Spice Market: 188 14th Street NE, Atlanta, (404) 549-5450
Other branches: New York City, Istanbul, Doha (Qatar)
Market: 3377 Peachtree Road, Atlanta, (404) 523-3600
Other branches: Paris
BLT Steak Atlanta: 45 Ivan Allen Jr. Blvd., Atlanta, (404)
577-7601
Other branches: New York City, Washington, DC, Los Angeles,
Miami, Hong Kong, Charlotte
Il Mulino New York-Atlanta: 191 Peachtree Street, Atlanta,
(404) 524-5777
Other branches: New York City, Washington, DC, Las Vegas,
Chicago, Atlantic City, Aspen, Miami, San Juan, Tokyo
Straits Atlanta: 793 Juniper Street, Atlanta, (404) 877-1283
Other branches: San Francisco, Burlingame, San Jose, Houston
RA Sushi: 1080 Peachtree St., Atlanta, (404) 267-0114
Other locations: Multiple locations in California, Florida, Illinois
and Arizona; Las Vegas, Baltimore, Houston and Dallas
EVOS : 885 Peachtree St., Ste. 2, Atlanta, (404) 252-4022
Other locations: Tampa, Chapel Hill, San Luis Obispo, CA
