Eatzi's CEO talks new locations, food delivery and competition | Crain's Houston

Eatzi's CEO talks new locations, food delivery and competition

  • Eatzi's CEO Adam Romo takes a patient approach to opening new locations but jumps on one if the opportunity arises. | Photos courtesy of Eatzi's

    Eatzi's CEO Adam Romo takes a patient approach to opening new locations but jumps on one if the opportunity arises. | Photos courtesy of Eatzi's

  • The new Eatzi's in Fort Worth opened in May in University Park Village.  | Photos courtesy of Eatzi's

    The new Eatzi's in Fort Worth opened in May in University Park Village. | Photos courtesy of Eatzi's

It’s been a busy 2017 for Eatzi’s with a new location open in Fort Worth and another opening hot on its heels in Dallas this fall. And the prepared meal store founded by Phil Romano is constantly scouting for new locations in fast-growing Collin County and even the Houston area.

But Eatzi’s faces more competition than ever before as technology changes how people buy food, where they buy it and the expectations that come with it. Also, places like Snap Kitchen have invaded the prepared meal space.

From opera music to the smell of fresh food cooking, CEO Adam Romo knows how to create an experience that keeps people coming back. Each location has 1,600 items for sale ranging from prepared meals, grilled meats, pizza, beer and wine, breads and sandwiches. And for those customers who want the ultimate convenience, delivery is available through a Texas startup.

“We look like a grocery store but we’re really not. We’re a market preparing high-quality meals,” Romo said. “We prepare everything from scratch every day at all locations. That’s a Herculean task when you look at the size of our menu.”

Meticulous growth plan

Despite going from four stores to six in one year, Romo said he maintains a measured, meticulous approach to new locations.

Romo has a checklist for each new location that includes adequate parking, a large office population for the lunch crowd and nearby homes for the dinner rush. The final piece of the puzzle is demographics.

“One of the things I’m committed to is we’re not going to open stores just to open stores for growth sake,” Romo said. “We don’t have some growth rate that we have to hit.”

The company’s corporate staff runs lean, too.

“That’s a tough challenge, growing 50 percent of your store count in one year,” Romo said. “But when we find the right locations that’s really the driver for us.”

The new location at University Park Village on University Drive in Fort Worth opened in May but Romo had his eye on that area for years.

“I must have looked at 25 different sites in Fort Worth,” Romo said. “I knew the right location was up in the Village area. When that finally did come up, they were very anxious to get us in and we were very anxious to get in there."

When Eatzi’s opens the new location at the northeast corner of Preston Road and Royal Lane this October, the company’s workforce will reach 1,000 employees.  

The size of the stores has scaled down from the 10,000-square-foot stores when they first started to more economical 5,500-square-foot locations. They still offer the same variety of products on the shelves but have smaller kitchens and less storage. That allows Eatzi’s to move into the end cap on a strip center, such as the Royal Lane location.

“We figured out a way to squeeze into smaller stores,” Romo said. “We’ve been able to adjust our back of the house operations to accommodate the smaller space. We have to replenish the food faster because we don’t have the kitchen space to store the food.”

Michael Hale, vice president of leasing at EDENS, the landlord for the Dallas location, said Preston Royal Village has lacked a true anchor for years.

EDENS wanted to bring in a tenant that would drive daily visits to the center and increase traffic to our other retail partners,” Hale said. “Their attention to detail on both the interior and exterior of their stores makes each trip memorable and one that many of their customers make several times a week.”

EDENS has properties nationwide so Hale sees potential for Eatzi’s to grow to new markets, such as Washington D.C. 

Eatzi’s is constantly looking for locations in Frisco, Allen and Southlake but has yet to find the perfect spot, Romo said.

But they’ve already started scouting the Houston area and know where they want to go.

“We’ll continue evaluating those various locations,” Romo said. “Once I reach a point where it kind of stalls out in terms of quality sites, we’ll look at other Texas cities and do the same thing.”

Branding to stave off competition

Eatzi’s faced little competition when Phil Romano opened the first location on Oak Lawn in 1996. Romo, who has been CEO since 2011, doesn’t view grocery stores or tech startups like Blue Apron, Martha & Marley Spoon or AmazonFresh as competitors because they mainly deliver raw ingredients to customers.

“We [cater to] somebody who has already made the decision not to cook,” Romo said.

Eatzi’s bread and butter is cooked meals that are ready to go.

“There’s others that have components of what we do on a much smaller scale but we’re still as unique as we were,” Romo said. “It’s pretty gratifying to see that we were ahead of the curve back then and we’re still there after two decades.”

Eatzi’s prides itself on quality, variety, convenience and value to differentiate itself from its restaurant competitors. The “icing on the cake” is the theatrical component, Romo said.

Customers enter through the kitchen so they see and smell the food being made. They also hear the Italian opera music that was a picked by Phil Romano himself when he founded the first Eatzi’s.

Doing you a Favor?

UberEats is perhaps the biggest threat to businesses like Eatzi’s because it brings restaurant food to people’s doorstep.

David Denney, founder of the Denney Law Group, which specializes in restaurant and hospitality law, said 74 percent of millennials would use restaurant delivery if it’s available.

But there are risks and hard costs associated with this relatively new phenomenon. It’s critical that businesses invest in branded bags and packaging so that other people in the office or on the street see your food being delivered.

“If you see a Favor driver get into the elevator with a brown paper bag, that’s a missed opportunity,” Denney said. “People that scrimp on the to-go materials to save a few pennies are missing out on that off-campus marketing opportunity.”

More importantly is whether the contract drivers will represent the brand well and if there are any legal risks.

“It’s a huge deal for a restaurant to put its product in the hands of a stranger to deliver,” Denney said. “It’s really hard to police no matter which delivery service you signed up for.”

Denney encourages his restaurant clients to demand legal protections so they aren’t responsible if the food is damaged or makes someone sick because it wasn’t delivered properly or on time.

 

July 12, 2017 - 11:41am