While some chain restaurants struggle to figure out how to bring back dwindling customers (Olive Garden tried to woo millennials last summer with food trucks; Denny's launched a spin-off with "vibe" called the Den), Kimbal Musk thinks the problem is the food itself.
Musk, a restauranteur (and some guy named Elon's younger brother), plans to take Next Door, his small Colorado-based chain of healthy, affordable restaurants, and expand it throughout the Midwest and South. As much as possible, the food will be organic. Half of it will be locally sourced. Almost everything will cost less than $10. (There was a wave of press saying the menu would be under $5, but this, sadly, isn't the case.)
"It's basically a real food version of TGI Fridays or Applebees," he says. "So in casual dining as a category—people just don't really want to eat industrial food anymore."
Healthier, fresh food is becoming more common in fast-casual chains, but less so in so-called casual dining restaurants. "In the casual dining category, no one's ever been able to come up with a concept that is real, fresh food at the same price point, and the same experience, where people sit there and eat together," says Musk.
The Kitchen Restaurant Group, Musk's company, already runs three original Next Door restaurants, which serve foods such as salads made with locally grown root vegetables, greens from a local vertical farm, and meat from local ranchers. But Musk wants to expand throughout the heartland, starting with Memphis and Chicago.
"We have refined our strategy to focus on areas where we can have the greatest impact in the shortest period of time—coupled with long-term viability and success," he says.
The biggest challenge is building local supply chains. "If you want to do a casual dining restaurant exactly the same way as everyone else, you go on a computer and you log in and you fill in the forms, and the next day a big truck arrives and you'll get that product," says Musk. "It will be product that you don't understand where it came from, you don't really understand what's in it, you won't really know exactly what you're eating. That is the industrial food system. You can do that pretty easily."
For Next Door, instead, the company has to carefully search for local suppliers and sometimes help train them how to supply the scale needed for the restaurants. Because of the challenge, they plan to expand in targeted cities—using the same supply chain through each city—rather than trying to quickly sprawl nationwide.
"The strategy we have is really to go deep rather than to go wide," he says. "So if you think about Chicago, we could probably do 50 Next Doors just in the city of Chicago. It's a huge city. But we wouldn't do what a typical restaurant company would do—we wouldn’t go wide, do 50 across the country. Because then we'd have to build up 50 different supply chains."
The restaurants also partner with Learning Gardens, Musk's nonprofit project that builds school gardens in cities.
The goal is to help as many people as possible start eating more healthy, fresh food. In the three Colorado restaurants, the chain serves about 10,000 people a week now.
"For us it's important that we're reaching a lot of people," Musk says. "At that price point, we saw we're able to reach almost every family. Maybe they can't eat out every day there, but they can eat there once a week or once a month, and it can be a real replacement to the industrial food casual dining restaurants."
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