Checkers CEO on driving the top line

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Quick-service customers have changed their behaviors since the Great Recession, but evolving menus, marketing, operations and facilities has helped Checkers Drive-In Restaurants grow traffic and sales in a difficult environment, chief executive Rick Silva tells Nation’s Restaurant News.

Year-to-date, company-owned Checkers and Rally’s locations have recorded a 7-percent increase in same-store sales, lapping a 7-percent gain for 2011, he said. Franchised units’ same-store sales rose 5 percent year-to-date, over a slightly positive result for 2011.

The recent success comes not from being all things to all people, but by being all things to the drive-in chains’ core customer and meeting their needs for convenience and value, Silva said.

“Flavor, value and drive-thru convenience — those are the occasions we want, and we spend all our innovation and marketing money against those occasions,” he said. “When we are, that’s when we’re rewarded with more visits. We don’t need all occasions, because the category is so big, but we need [to own] the best occasions we can be best at.”

Silva spoke with Nation’s Restaurant News about how Checkers’ recent sales and traffic growth will allow for accelerated expansion in the near term.

Where has Checkers’ same-store sales growth come from? Has it been increased traffic, average check, or both?

It’s coming from a lot of places. Our chicken wings are doing well for us and so is the product we launched last year, Cold Creations [frozen treat line]. We expanded our Chicken Bites to have Spicy Bites and Fish Bites during Lent.

We’ve worked a lot on value and taste, and the comp growth is predominantly traffic, which is what excites us so much. We’re trying to give our customer more reasons to visit us. I would say 90 percent of the comp is coming from traffic. We’re delivering the best value scores in the category … and that keeps guests coming back.

The other way we’re increasing traffic is through operations, and our speed of service is as fast as it’s ever been.

If your success has been primarily due to traffic, has that come mostly from Checkers’ and Rally’s value proposition?

We have permanent value all over the menu, especially for under $5. You can get two items for $4 and some premium products for two for $5. All across our menu people can find different ways to eat.

We focus on the core QSR user who visits the category between 20 and 25 times per month. We stay very close to this customer and understand what they want. To the extent that we had products like wings or Cold Creations, we do so because that’s what the consumers indicate they have needs for that we can fulfill.

The other way for us to grow revenue is staying focused on late night. We see ourselves as specialists in that daypart. We stay open late with our walkup windows, and that helps us stay relevant. They’re all reasons to come visit us more.

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