Right portion, right business model

Jeremy Hobson Jun 22, 2007
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Right portion, right business model

Jeremy Hobson Jun 22, 2007
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Scott Jagow: TGIF. I mean that sincerely, but we’re also gonna talk about the restaurant chain T.G.I. Fridaya€™s. Fridaya€™s is trying something new: smaller portions and cheaper prices. Imagine that in America. But it seems to be working, as Jeremy Hobson reports.


Jeremy Hobson: Usually, in the restaurant business, bigger is better — Whoppers, Big Gulps and those enormous Cheesecake Factory salads.

John Glass: Historically, chains that have offered large portions or a great price value have done better.

John Glass is a restaurant analyst for CIBC World Markets. He says the super-size strategy has always been popular with customers. So going smaller was a risk.

Richard Snead: Riskier than I thought in those first 60 days.

Richard Snead is the CEO of the company that owns Friday’s. He says despite tense times early on, the customer count has started climbing — and check averages have increased.

Snead: Right now, we are outperforming the category. And by the way, it is a soft environment for casual dining right now.

Analysts say the Friday’s model’s success might not be about the waistline or even the bottom line. They say it’s about choice — and maybe not having to deal with a doggie bag.

I’m Jeremy Hobson for Marketplace.

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