Famous Dave’s Expands With 21 New Franchise Deals
Eighteen of the Minnetonka-based barbeque chain’s new locations will be in California, mostly in the southern portion of the state. Additionally, a single new location will open in the cities of Lansing, Michigan; Independence, Missouri; and Yakima, Washington.
A spokeswoman for Famous Dave’s told Twin Cities Business that all of the new restaurants will open within the next two years and most will become operational within the next year.
The California locations will more than double Famous Dave’s presence in that state, where there were 14 restaurants as of January 1.
“With this signing, we are getting a great head start on our goal of adding 50 new locations over the next two years,” Famous Dave’s CEO John Gilbert said in a statement. “With even more deals on the table, Famous Dave’s growth potential looks outstanding.”
Gilbert added that the current real estate market has created some of the best site opportunities in the company’s history.
Famous Dave’s owns 53 locations and franchises 132. Its current geographic footprint spans 33 states and one Canadian province. The company opened its first international location in Winnipeg in July, and that location has “blown away all expectations, earning the highest sales we have ever seen at any location,” Brett Larrabee, Famous Dave’s director of franchise sales and development, said in a statement.
The company’s revenue grew 4 percent to $154.8 million in its most recently completed fiscal year, which ended January 1. But net income for the period totaled $5.5 million, down 22.9 percent from the prior year.
Meanwhile, sales for the quarter that ended September 30 totaled $39.9 million, up 2.6 percent from the same period a year ago. But net income totaled $845,000, down 46 percent from the same quarter in 2011. The company said that third-quarter earnings were negatively impacted by the timing of its spending on media and direct-mail marketing initiatives, which occurred during the fourth quarter of last year. Famous Dave’s also cited “continued margin pressure from increased commodity costs and labor and benefit costs.”
Gilbert took the reins as CEO last month. The former CEO of Shelburne, Vermont-based e-commerce retailer Vermont Teddy Bear Company, Gilbert replaced Christopher O’Donnell, who transitioned to a new role as president and chief operating officer.
Upon announcing the C-suite transition, Famous Dave’s Vice President of Marketing Aric Nissen told Twin Cities Business that the two men are “unique individuals with great and different skill sets who have worked together on the company’s board” and will now work closely in the executive suite. O’Donnell’s strengths lie in operations, while Gilbert will focus on growth, emphasizing marketing and brand management, Nissen said.
“Christopher’s leadership got us where we are today, and we still need that,” but we also need to focus on expanding the brand, he said, citing as an example the company’s recent expansion into Canada.