From family-only to franchising: Southern Classic moves on out

December 10, 2020

Southern Classic Chicken begins franchising, with an all-in attitude for off-premise eating.

Dec. 10, 2020 | by S.A. Whitehead 

With all the strutting and squawking many chicken-centered QSRs are doing amidst the ongoing salvos of the  chicken sandwich wars, bone-in QSR fried chicken sales hardly get much mention. 

Granted, the KFCs, Bojangles', Church's and even the rapidly expanding Filipino brand, Jollibee, do get their  fair share of media mentions, but for every one of those larger bone-in-focused chicken chains, this category  has hundreds of much smaller brands that collectively capture more than their share of highly localized fans. 

One of those in the Texarkana area where fried chicken is basically a religion, is the 17-unit longtime family  brand-gone-franchised, Southern Classic Chicken, based in Shreveport, Louisiana. 

For 31 years now, the Fanning family's concept has been filling the bellies of Southern fried chicken-lovers with  sustainable success. And now, at the terminus of this very unusual and unusually trying restaurant year, the  brand has begun its franchising expansion efforts.

And guess what? The pandemic made 'em do it, pretty much. To be more specific, the company said its  outstanding performance since COVID-19 hit the U.S. in earnest last March, was the deciding factor for  Southern Classic leadership to push ahead with its entry into the sometimes brutal chicken fight that  restaurant franchising can be. 

"We are making fried chicken cool again." 
 -Nick Binnings 

Southern Classic Chicken Director of Brand Development Nick Binnings — formerly of Another Broken Egg  Café and other ventures — is spearheading these efforts. He brings some real restaurant street cred to the role,  too, having grown his previous restaurant employer's unit count from 15 to 62 during his tenure. 

He has no doubts about that kind of performance from Southern Classic  particularly since despite the pandemic, the brand still experienced a more  than 20% bounce in drive-thru sales alone . In fact, drive-thru and walk-up  sales have been so good over the last year that the brand has now decided to  put both its feet into that kind of operational model and move away from  dine-in completely 

But Binning said he was strongly heading in that direction anyway even before the pandemic affected restaurant life as usual in the U.S. He said the brand's past performance, along with the future economic potential of  eliminating dine-in, has for more than a year made the change seem likely. 

For a chicken chain that prides itself of the value it offers customers, making  those economics a little easier on the business's financial waistline is  critical. In fact, Southern Classic offers pretty hefty fried chicken meals with  sides for between $5 and $7 each. 

That value offering is not up for negotiation, Binnings told us. But there are advantages to be had in the  elimination of dine-in, which is where QSRweb recently began its question-and-answer session with the chain's  leader. 

Q: So since you all were planning to move away from dine-in even before the pandemic put the  squeeze on that restaurant format, can you tell us the reasoning behind that and if and how the  pandemic's entry into the scene changed that? 

A: Over time the data was showing us that the drive-thru lane was accounting for such a high percentage of  sales, that having a dining room was costing us labor dollars. The founders have actually had drive-thru only  units for over 30 years now and those units have always produced some of the highest sales in the system. … 

Once we saw the 20% increase in sales in our units after COVID had been around a few months, we knew this  model was ready. We feel very strongly that this brand and model can sustain, if not thrive, during challenging  times. 

Q: Does the move to all off-premise business change brand strategy, communication and marketing? 

A: This does not affect us in anyway. For marketing, it will help on the franchise recruitment side because the  model is now easier and uses fewer team members.

"I would expect to see the brand becoming a major force in the bone-in chicken segment of the QSR industry." 

Q: How does the elimination of dine-in — relative to future builds — change the specifics of  Southern Classic Chicken's ideal location and cost of entry for franchisees? 

A: The ideal location does not change at all, but the size of the land does. This has allowed us to go to a much  smaller footprint all-around, which definitely saves money in the land cost and buildout. 

We estimate that the new build out has been reduced by $300,000. Depending on the land cost, we can  become operational for $1.5 million to $1.7 million. 

Q: Where are you concentrating the brand's growth goals going forward? 

A: We are targeting markets that are close to Shreveport, Louisiana, and within a three- to  four-hour drive (of there). We feel it is very important to grow slowly outside of your home market so you can get the efficiencies in branding, supply and management. 

As we fill in close markets, we will jump to the next. This is a long-term growth model, and we have a very solid game plan and will stick to it. A lot of young brands run into trouble when you start skipping over markets. 

You have to fill in areas close to home and keep pushing out. Most people do not factor in the supply chain and  how expensive it is to the brand when you do not have volume in each distribution house. 

Q: How has the pandemic challenged or possibly even helped the brand in its franchise efforts? 

A: The only challenge to our franchise efforts is that we had to pull back six months before launching (from  originally planned start-date of February 2020 to September this year). 

I hate to say there are any upsides to this pandemic, but our unit growth with all units operating with only  drive-thru lanes has given us even more confidence in our model and the future of the brand. 

Q: Well then, speaking of the future, where do you see Southern Classic Chicken size-wise in  five years? 

A: While I do not want to say we will have "X" number of units in five years, I would expect to see the brand  becoming a major force in the bone-in chicken segment of the QSR industry. 

We are making fried chicken cool again and will be developing a system that truly supports our franchise  partners and makes decisions that are best for everyone and not one-sided. With the brand having a very  patient ownership group, this will allow us to make solid decisions that are for the best of the brand and not  based on selling franchises because it needs cash flow. 

(Former Smoothie King COO and current Southern Classic Managing Director) Tom O'Keefe and I are very  excited to be a part of such an amazing brand. And, even more important, we are very grateful for the  opportunity to help this amazing Fanning family (owners) grow something that has been in their hands for 30- plus years.

Article Credit: wsrweb.com by S.A. Whitehead

Other News