Evaluating second-gen opportunities

Hi!

April was a banner month for Prefix. We welcomed over a dozen new brands representing thousands of new locations to the platform. (We even onboarded a location at the Prefix booth during the Restaurant Leadership Conference!)

I couldn’t be more proud of the Prefix team for shepherding our new users, and I’m grateful to everyone who believes in what we’re building. Onwards!

Tip 1: How to tackle second-gen restaurant spaces

If your brand is in growth mode, a second-generation restaurant may look pretty attractive these days. Real-estate outparcels are still hard to find. Building out a plain vanilla shell isn’t cheap. Finding a second-gen spot in good condition helps reduce costs and can greatly speed up the process of getting a store open.

One of the nation’s fastest growing brands, Dave’s Hot Chicken, laid out its playbook in 2021 — in an article from that year, CEO Bill Phelps said every one of its new stores was a takeover of a second-generation restaurant building.

Sometimes an opportunity will hit your desk for a second-gen restaurant with equipment left in the space. Even if the equipment isn’t a 1:1 match for your brand, we think these opportunities are worth considering. Here are some tips for how to get the best deal possible:

1. Evaluate: Take a close look at the kitchen equipment included in the lease agreement. Assess the functionality and suitability of each piece for your concept. Consider factors such as age, brand, and maintenance history to determine if any upgrades or replacements are necessary.

2. Test: Test each piece of equipment to identify any issues or malfunctions that may require attention. If you have access to serial numbers, you can plug the assets into Prefix and get a head start on understanding the equipment’s ongoing maintenance requirements.

3. Negotiate: Use the presence of equipment as leverage during lease negotiations. Review equipment databases to get a sense for the fair market value of the equipment, and go into the negotiation with an information advantage. Take stock of which pieces don’t make sense with your concept, and whether they should be resold or left out of the negotiation.

Ultimately, knowing you have a system like Prefix in your back pocket can give you a leg up when evaluating a second-gen opportunity.

Mental health break

Planning a summer road trip? Here’s a comprehensive list of every “Pizza Hut Classic” left in the United States.

What makes up a Pizza Hut Classic, you ask?

• The Pizza Hut logo atop the restaurant’s pole sign

• An interior featuring iconic red booths and Pizza Hut lamps

• A sticker of long-forgotten mascot “Pizza Hut Pete” on the front door

• Posters featuring Pizza Huts of time gone by

No word yet on whether you can redeem your unused Book-It certificates from the late ‘90s…

Tip 2: Grab your vendor’s lunch

Finding and keeping good service techs is hard. That’s partly why we designed our vendor management service to enable you to work with your preferred vendors. We even allow you to communicate with your service techs through their preferred channel — if “your guy doesn’t do email,” Prefix supports SMS messaging.

We’re big fans of accountability, too. So we built into Prefix safeguards against overbilling and incomplete work. You deserve quality work for your hard-earned dollars.

But our last tip of the month is built on the belief that the Restaurateur-Vendor Relationship shouldn’t be all “sticks.” Offering a carrot from time to time goes a long way.

So: consider picking up your service tech’s lunch the next time he or she stops by during mealtime. It’s a simple gesture rooted in hospitality, which is what got us all interested in this business to begin with.

The vendor will appreciate it, and you’ll have one more raving fan to do some word-of-mouth marketing for you.

Thanks for reading UPTIME #3!

We’ll be back next month with more tips and details on what’s new at Prefix.

Have something you’d like to see covered in a future newsletter? Shoot us a reply!

All the best,
Jared