Growth is a primary focus for restaurateurs nationwide, and like many of us in the industry, we’ve spent the pandemic redefining Hopdoddy’s expansion plans while positioning ourselves to win in a changed industry. .
COVID has forced leaders to innovate and seek new ways to grow. While Hopdoddy didn’t open any new restaurants in 2021, expansion was on our radar. We have spent the year developing a comprehensive plan. With options ranging from opening multiple company-owned locations to offering franchise opportunities, we began to strategically seek out another concept/brand out there that closely aligned with ours with which we could merge to relaunch our organic development. In January, we did just that.
Earlier this year, we completed our acquisition of Grub Burger Bar, which will nearly double the size of Hopdoddy under the new HiBar Hospitality group umbrella. The restaurant conversion process is now underway. When complete, we will have increased Hopdoddy’s footprint from 32 to 50 locations within a year.
While there is no one correct way to successfully execute a restaurant merger, we have found an approach that has worked well for us.
Find and identify organic alignments
The most important step comes first: research. When looking for a restaurant brand to acquire, the more it matches your culture, culinary expertise, and values, the more likely the merger will be successful. Sharing common values and vision regarding people, menu innovation and restaurant appearance is essential.
In the case of Hopdoddy with the acquisition of Grub, both brands are better burger concepts that value people, process and product. At the heart of this are individuality and innovation. Right off the bat, it felt like a natural fit.
Merging with a brand with an aligned culture and brand promises facilitates the operational adaptation of the restaurant team. From training to customer interface, teams don’t have to learn a new service or management style, different cooking techniques, or how to work with different ingredients. The kitchen does not need to be completely reconfigured. Our first conversion took less than a week – we closed on a Sunday and reopened the following Friday, with the same BOH and FOH staff fully ready to execute our menu and provide the hospitality and Hopdoddy standards we are known for .
The similarities between our brands also help maintain and excite local customers. We’ve taken a ‘best of both world’ approach incorporating key elements that have made Grub successful while integrating into a Hopdoddy main menu. Hopdoddy offers similar and improved versions of burgers that will excite Grub fans when they discover that their favorite burger haunt is moving to a new brand.
Another key part of the process is looking at a restaurant group’s real estate footprint. When optimizing places for growth and expansion, it is ideal to identify a thriving restaurant with brand recognition in existing markets and new desired markets. Finding this provides more options to grow organically in existing and new business areas; expand growth opportunities and ultimately increase the likelihood and ability to grow effectively.
In our case, several Grub restaurants were in markets where Hopdoddy already has a presence, such as DFW. Others were in cities relatively close to existing Hopdoddy units in Texas, allowing the concept to expand to new cities and states with some recognition and brand awareness. Other Grub locations, such as Atlanta and Florida, do not have Hopdoddy restaurants, but are in areas Hopdoddy wanted to expand into. The merger paved the way.
Prior to Acquisition Closing
Prior to closing the deal, our first step was to culturally align and crystallize our shared vision. The combined leadership teams met offsite for two days with the goal of getting to know each other and aligning on our core values, mission and vision, and “how we work together” in our newly created company, HiBar Hospitality Group. I thought it was important for us to create a new company to join the two brands rather than just having Grub join Hopdoddy. HiBar Hospitality allowed us to create something unique and more powerful by combining the two brands together.
Restaurant conversions
Before we jumped into the conversions, our next step was for me and key executives from Hopdoddy and Grub to hold a series of town hall-style meetings with members of the Grub team. The main focus was to listen and learn from our new team members as well as introduce ourselves, the Hopdoddy brand, and what to expect in the coming weeks/months. We knew it would be imperative to not just rename the restaurants, but to truly welcome new Team Grub members into the Hopdoddy family and create an informed, inspired and integrated team.
When we visited all Grub restaurants, we shared restaurant conversion plans, our retention strategy and what to expect. We had three main objectives that we hoped to clarify during this pivotal period:
Retain Grub Team Members: We’ve offered jobs to all Grub team members at all levels, from C-suite members to restaurant employees. With our two brands’ shared goal of putting people first, we wanted to show them that we value their experience and loyalty. We were thus able to retain the majority of the Grub teams thanks to the conversion.
Educate and build brand awareness and excitement: We shared additional information about our brand identity and values focused on team members, communicating the positive impact it would have on their community and, more personally, on their own career growth.
Generating enthusiasm for the change to a new brand: This is essential because enthusiastic team members transmit this energy to restaurant customers.
Going forward, we plan to use this as an ongoing approach in our growth strategy. Hopdoddy and HiBar Hospitality are just getting started.
Jeff Chandler is the CEO of HiBar Hospitality.
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