How much does name recognition matter in the competitive restaurant industry? It can mean quite a bit for the success of a new brand. The Wahlberg family, most known for celebrity brothers Mark and Donnie, announced major expansion plans this year for their restaurant chain Wahlburgers. So far, they’re off to a promising start.
In May, the brothers announced plans to open six to eight locations in 2015, with 66 more in development over the next several years. They also announced a 20-store franchise deal with with Arjomand Group of the Middle East, an agreement with SSP America to operate at Boston's Logan and Toronto's Pearson airports, and extended its contract with New York-based Big Apple Burgers to include six units on Long Island, in addition to five in Manhattan and one on Coney Island. The Coney Island Wahlburgers location just opened on Sept. 15.
Long term, the brothers are aiming for 300 restaurants nationwide.
Burgers With a Side of Reality
It’s not just the burgers that people are eating up. Last year, A&E ordered 18 episodes of the reality TV show “Wahlburgers.” It’s a sign that Mark, Donnie, and big brother Paul, the executive chef, are all in with their commitment to the brand. As Fast Casual points out, the Emmy-nominated reality show means huge celebrity exposure for the chain and a shot at top-notch real estate. Later this year, Wahlburgers will open a location at Grand Bazaar Shops at Bally’s Las Vegas.
This one of-a-kind brand experience adds another level of necessity for auditing on a location-by-location basis. The Wahlbergs can’t take anything for granted. As we’ve discussed previously, restaurant soft openings are key to success, especially when opening in new markets. Being ill-prepared for a restaurant opening can be a disaster. (Just ask Guy Fieri.)
New Kids on the Burger Block
Recently we’ve discussed the overexpansion of the west coast grocery store chain Haggen, where overexpansion led to problems, a costly scale back, and sadly a bankruptcy filing. While it's a different industry, the same rule applies: You don't want to bite off more than you can chew.
In the restaurant industry, Wahlburger’s follows in the footsteps of Five Guys Burgers, which offers similar menu items and franchised operations. Wahlburger’s plans for gradual expansion seem wise and will hopefully help the chain avoid operational pitfalls that can sink a brand. As we’ve discussed in previous blogs, In-N-Out Burger and Shake Shack do not franchise for this reason—they want to maintain tight brand control.
According to Grub Street, Wahlburgers is constantly fielding offers to partner due to the popularity of their TV show and the brothers’ stardom. However, they want to see a track record of success, and won't consider a potential franchisee with a net worth of less than $5 million.
It will definitely be interesting to see if Wahlburgers can successfully franchise their business as the brand grows rapidly.
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