P.F. Chang’s COO: ‘We’re taking takeout to the cities and the suburbs’
-
P.F. Chang's is pursuing a two-tier strategy with its takeout shops. -
P.F. Chang's is pursuing a two-tier strategy with its takeout shops.
P.F. Chang’s Bistros generally do about $1 million in takeout business each year. So in 2020, the star Asian food tenant of malls and lifestyle centers decided to open P.F. Chang’s To Go in downtown locations in major metros—just as downtown residents were escaping COVID by moving to, or staying in, the ‘burbs.
The company subsequently closed its To Go locations in the Theatre District and at Grand Central Terminal in Manhattan.
“We did jump right into downtown Chicago and New York in 2020, thinking that the best square footage production was in urban footprints. Unfortunately, offices had been vacated and all the catering business they generated went away, too,” said P.F. Chang’s COO Art Kilmer.
Chang’s shifted gears and followed remote workers to their homes in suburbs in places like Lake Nona, Fla., and McKinney, Texas. Eleven locations are now operating, five more are planned for this year, and another seven in 2023. To Go is growing cautiously, but Chang’s will explore both urban and suburban markets with a binary customer strategy.
Chang’s decided to move its tantalizing brand name and menu to big cities due to sheer opportunity. The Chinese families running the thousands of takeout joints in metros like New York and Chicago were diminishing. Their children and grandchildren were obtaining college degrees and leaving the stoves and delivery routes. An analysis of Yelp data by the Chinese Hospitality Alliance Tea Talk (CHATT) found that, between 2016 and 2019, the number of Chinese restaurants in New York City dropped from 2,969 to 2,493. In a mere three years, one-sixth of the prime movers of Wonton Soup and General Tso’s Chicken went away.
“We noticed these shifting demographics in evaluating our bistro takeout business,” Kilmer said. “The kids were leaving the business and the operators were aging and retiring. We saw this as an opportunity to enter urban markets with a menu people there already knew and loved, and that we made with fresh ingredients sourced from local farms.”
The second strategic pillar was planted when Chang’s began opening in the suburbs: Make it easy for the people who already were Chang’s customers to enjoy the food more often.
“Our suburban locations fill in the whitespace in those communities,” Kilmer said. “They love the food, but they may not want to drive 20 or 30 miles to get it. The suburban model has worked for us very, very well.”
Kilmer said the company intends to open eight to 10 To Go locations over the next few years with updated décor reminiscent of the bistros, seating for in-shop dining, and mood music.
“On weekdays, we want to make it convenient for people to go eat at a P.F. Chang’s To Go, but we want to show them something differentiated from the typical Chinese takeout,” Kilmer said.
The first 11 To Go locations are found in Texas, Illinois, New York, and Florida.