After expressing its interest in ghost kitchens at large and Kitchen United’s upcoming Chicago location in specific, fast-growing hot dog franchise Dog Haus announced it will be one of a dozen brands testing the viability of a mobile-ordering and delivery-only restaurant.
A chance meeting at their kids’ school for Dog Haus and Kitchen United execs, both based in Pasadena, led to a visit to the test concept and ultimately the deal, said Dog Haus CEO Andre Vener.
“We wanted to see the data about how it will work. We were just lucky to be one of the first people to know about this stuff,” said Vener.
Dog Haus committed to the next 25 Kitchen United locations slated to open in 10 markets by the end of 2020.
Vener sees four promising aspects of the concept that “can really help us.” One is help for a good problem to have: too many customers standing in long lines. “We can go into one of these Kitchen Uniteds and help with the overflow of the orders. And we can accommodate all the diners,” he said.
The second is entering new markets with less risk than a traditional restaurant. He cited Atlanta, one of the 10 markets where Kitchen United openings are planned, as an example. “We do the marketing, we do the branding and we can test out the market,” he said. “Then once we know it’s up and running and we have demand on the food we can look at a multi-unit operator” to sign.
A third plus: Testing the menu during different hours of the day, and tailoring it to certain demographics.
And a fourth: “They have all this data that they have been pooling. They can go into a market and see what is the biggest search” and tailor the offerings accordingly, he said.
Dog Haus has about 30 brick-and-mortar locations nationwide and another 20 in development. Jesse Koontz, the franchisee for the River North neighborhood, will be the operator for the Chicago Kitchen United location.
Asked if Vener was concerned about risk in the deal since Kitchen United, although backed by the well-heeled Google Ventures, is a start-up, he replied no. “Kitchen United is a strong company, they’ve been funded, and if something didn’t work out in six months you could exit the contract. If it wasn’t working out, our risk would be six months of labor,” he says, a drop in the bucket compared with the risk of opening a bricks-and-mortar restaurant.