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Dallas, Texas – Ken Reimer knows how to build things, including real estate groups, construction manufacturing firms and insurance and restaurant companies.
His latest undertaking is building Baker Bros American Deli, an upscale, fast-casual deli chain specializing in specialty salads, gourmet pizzas and sandwiches on artisan breads, into a national chain.
The franchise model that Reimer has developed for the fast casual concept supports the growth that he is aiming for. With 12 units open and 30 more franchise locations under construction or under contract in Arkansas, California, Las Vegas, South Carolina and Texas, Baker Bros is on the road to rapid expansion.
The idea for the Baker Bros concept blossomed while Reimer was helping rebuild the insolvent casual dining chain Tony Roma’s during the mid-1980s.
In 1998, Reimer created the framework for Baker Bros, a fast-casual restaurant that encompassed everything he wanted in a restaurant chain.
Reimer devised the concept to replicate a high-quality product over and over again in a handsome environment, yet offered reasonable margins and required a modest investment and limited labor pressure.
The conception of Baker Bros may have been a calculated one, but its success was a result of some lucky breaks along the way.
A major public company in Southeast Asia committed the capital to bring the Baker Bros concept to life by funding concept development of the first four units which opened in 2000.
Lucky break number two came when Reimer reconnected with skilled operator Tom Dahl, who served as former Tony Roma’s vice president of operations during Reimer’s tenure as CEO of the casual dining chain.
Reimer and Dahl helped grow the unit count for Tony Roma’s from 30 to 179 by implementing operational improvements and through ambitious franchising efforts.
When Reimer asked Dahl to join him in launching Baker Bros, Dahl quickly accepted.
“Tom is an exceptional operator with exceptional product and system design ability,” Reimer said.
Baker Bros offers a selection of 14 specialty sandwiches and build-your-own deli sandwiches made with premium meats, cheeses and fresh produce. Their proprietary hand-formed breads come in four varieties – farm bread, whole wheat, light rye and eggspun.
Eight salads are offered in regular or half portions, and six baked potatoes and eight gourmet pizzas prepared on focaccia crust round out the menu. Each category offers vegetarian-friendly menu items.
“The portions are unusually large, reasonably-priced and made-to-order with the freshest ingredients,” Reimer said. “We’re committed to exceptional value for our guests and very good returns for our investors and franchisees.”
Just as high-quality menu items are an important element of the Baker Bros concept, so is simplicity.
Hourly labor is kept to a realistic level with minimum equipment and production processes. The food production process is designed to be easily executed and replicated with minimal kitchen staff.
An average order takes five minutes or less to prepare. The kitchen occupies just 30 percent of floor space in units which range from 2,000 to 3,500 square-feet and seat 90 to 160 people.
“The operating system is unbelievably efficient,” Reimer said.
Such factors are resulting in a healthy return on investment.
Corporate locations averaged $1.3 million in annual sales in 2006 with average guest checks of around $7.50. The average guest count is 3,200 customers a week. Take-out and catering account for more than a third of total unit sales. Corporate locations have seen same-store sales growth of 6.9 percent, 12.2 percent and 10 percent in the last three years with very little advertising.
Baker Bros units range from $416,000 to $686,000 with the average totaling around $500,000 per unit. Franchise fees are $25,000 per location. Franchisees are required to open a minimum of three stores within end caps of powerhouse shopping centers, near medium-density offices or close to a mix of retail and residential development.
In the next five years, Baker Bros plans to have 60 to 70 units in operation with several airport locations.
“The thought of creating something special was interesting,” Reimer said. “If I believe there is something of substantial quality and market potential to do, then we ought to do 1,000 of them. The mechanisms to grow into a national chain are in place, and there is a breadth of experience in this tiny chain.”
Reimer believes Baker Bros’ name and story is the concept’s strongest branding element.
Although the Baker Bros story is fictional, the make-believe Midwestern brothers are named Ken and Tom, after Reimer and Dahl.
As the legend goes, the Baker Brothers were raised in a household in the heartland where Mama Baker taught the siblings the value of an honest day’s work and a good meal in return.
A giant hand-painted mural in each location conveys the Baker Bros story and depicts the American experience through a collage of images – the purple mountains of the West, the fields of grain in the Midwest and the skyscrapers of the East.
Baker Bros’ conservative design, which includes hard-wood tables and chairs, is reminiscent of a 1960s hardware store.
“The hardware store owner was a good proprietor,” Reimer said. “He was always honest, knowledgeable, he charged a fair price and he sold quality products.”
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