So You Want To Open a Chain Restaurant? You’ve Got To Learn About Chicken Wings.

Commentary about business and finance.
Jan. 31 2013 11:36 AM

How To Open a Chain Restaurant

It’s all about finding the right size of chicken wing.

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A Quaker Steak & Lube restaurant

Photo by Jim Larimore.

Chain restaurants—or casual dining spots, as they’re called in the business—are an American universal. Sure, we might crave seared scallops with a cauliflower puree accompanied by a glass of wine at a chic bistro, but we’ll end up with mozzarella sticks and a sizzling chicken skillet at Applebee’s more often than not.

Rachael Larimore Rachael Larimore

Rachael Larimore is Slate's managing editor.

There are 200,000 casual dining establishments in the United States, clustered at highway interchanges and shopping centers. They amount to a $200 billion-a-year industry, and they are successful because they hold a certain appeal: as a refuge for parents who are too tired to cook after a long week, as a convenient gathering spot for workers from suburban office parks, as a suitable place for guys to don their jerseys watch a game.

Because casual dining outlets have such ubiquity and such uniformity—a T.G.I. Friday’s in Cincinnati looks just like one in Indianapolis—it’s easy to believe that they spring from the ground fully formed, complete with booths and bars and servers in matching T-shirts.

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But when you spend time with those who franchise and build chain restaurants, you learn that they can take as much hard work and can cause as many headaches to open as a 50-seat locavore vegetarian joint. And opening a successful place engenders just as much passion and pride.

When we moved to our suburban Cincinnati neighborhood seven years ago, I was delighted to hear that a restaurant called Quaker Steak & Lube was joining the bevy of restaurants in a retail/dining development just a half-mile from our home. I grew up an hour from the original, which was located, as its name suggests, in an abandoned service station in Sharon, Pa. I never went myself, but it was destination dining for friends who would make a point to stop on trips to Pittsburgh. The chain is known for steaks and wings, and if you order their “atomic” sauce, you have to sign a waiver.

Even better, one of the men involved in opening the new Lube was also building the house next door to ours. Visions of garlic-sauced wings danced in my head. And in getting to know our neighbor, Jim Mills (who, I should disclose, has provided wings for plenty of neighborhood functions since the place opened), I’ve seen and learned just how much work goes into opening and running a chain restaurant. Things that people might never think of. For example he can talk at length about the challenges of finding just the right chicken wing.

Mills works for the Paragon Group, which just this fall opened its third Quaker Steak & Lube restaurant in the Cincinnati area. I wanted to learn how they do it, so I met with Mills and Jim Combs, the president of the group. Up until 2005, Combs had been the president of a company called the Bistro Group, a franchisee that owned 32 T.G.I. Friday’s, mostly in Cincinnati, Pittsburgh, Kentucky, and West Virginia. “[In 1996] I had been building restaurants in Pittsburgh for about 20 years, and I knew the market really well,” Combs relates. “We were looking at a piece of property near the new airport. We decided for financial reasons at that moment that we didn’t want to build at that location. The location ended up going to a gentleman who franchised the very first Quaker Steak & Lube.”

Combs kept his eye on that restaurant.

“My director of operations said ‘you have to come see this place, it’s crazy busy.’ We went in … people were loving it,” he recalled. “This concept in itself was very unique. High volume, casual, wings and burgers and beers. Very blue collar. At the time, I didn’t see a concept that really targeted blue collar customers like this. It’s family-friendly, it has a very loyal customer base. Once they like it, they like it more than any concept I’ve ever seen.”

Combs was intrigued, and eventually left his job and signed a development agreement to build four Quaker Steak & Lubes in the Cincinnati area. Not long after, Mills came aboard. What’s special about the Lube? We’re all used to walking into chain restaurants and seeing slightly different takes on kitsch. Friday’s, perhaps the originator of this theme, has its movie posters and faux sports memorabilia. The Lube takes this idea to a whole new level. Motorcycles and the shells of actual race cars and dragsters hang from the ceilings. Glass display cases hold scale models of sports cars and other vehicles. The door handles are gas pump handles. The menu is full of automotive-inspired puns. And the food? The wings are better than what you get at other similar joints, the burgers show attention to detail (the bacon’s actually crispy, and the toppings don’t obliterate the flavor of the beef), and the steaks are reasonably priced. (I usually just get the wings.)

So Combs had his concept. And he had his group. It was time to build a restaurant. Combs and Mills walked me through a rough timeline of their process. First, they set about finding a location and a developer. Their preferred business model is “build to suit”: A developer buys the land and owns the building, which is built to the restaurant group’s specifications and which is leased back to the restaurant. The Paragon group is responsible for everything inside.