Newk's Eatery CEO Frank Paci on Catering Growth and Evolving Consumer Preferences
In a recent episode of Fast Casual Nation, hosts Paul Barron and Cherryh Cansler welcomed Frank Paci, CEO of Newk's Eatery, to discuss the brand's growth strategy, catering initiatives, and response to changing consumer preferences. With 98 locations primarily in the Southeast and a history spanning 21 years, Newk's continues to demonstrate resilience and innovation in the competitive fast-casual landscape.
Paci shared that Newk's has seen significant growth in its catering business over the past four years, now representing approximately 11% of their total sales. Key to this success has been menu evolution, including offering premium salads and wraps like the Newk's Q wrap for catering, uncoupling bundled items to provide customers with more flexibility, and reducing ordering lead times from 24 hours to just four hours. "We've cut that down to four hours ahead of time, and we're looking at trying to figure out if we can go to two," Paci explained, noting they leverage third-party delivery services to fulfill last-minute catering orders without disrupting in-store operations.
Perhaps most telling of industry-wide shifts, Newk's has experienced a dramatic transformation in its business mix. Pre-COVID, the chain was roughly 60% dine-in and 40% off-premise. Today, 55% of sales come from off-premise channels, with digital ordering growing while traditional call-in orders consistently drop by about 20% annually. "The off-premise number never went down," Paci noted, explaining that in-store business recovered but off-premise maintained its pandemic-era gains, representing a "sea change" in consumer behavior.
This shift has directly impacted store design, with Newk's now building locations as small as 3,200 square feet compared to their traditional 4,000-4,500 square foot model. "The kitchen kind of remains the same size," Paci explained, "but what happens is you just don't need 140 seats anymore to service the dining-in business." The company is also embracing technology, rolling out Toast POS systems with kitchen display screens to replace their traditional ticket system, implementing customer-facing screens for loyalty program integration, and installing self-service kiosks that have shown promising results in average check sizes.
Looking toward expansion, Newk's is pursuing a strategy of growing outward from its core markets, targeting areas like Oklahoma and the Carolinas where brand awareness already exists. Paci emphasized the importance of finding the right franchise partners, noting they're increasing investment in franchise sales and looking at operators from other concepts who want to diversify, including former Popeye's franchisees and casual dining operators seeking a better work-life balance without late-night operations.
When asked about the future of fast casual, Paci expressed confidence in the segment's continued growth potential. "Fast casual has an opportunity to continue to take market share," he said, attracting customers who want something better than QSR without the time commitment of casual dining. He emphasized that successful concepts will focus on menu items that travel well, operational simplicity despite labor challenges, and convenience innovations that match QSR's traditional advantage. Most importantly, Paci stressed the value proposition: "We don't want to charge you a lot. We want to give you a good value... I'm making money off of that. I don't need to get [worried about sharing]. They came into your restaurant—be happy, for God's sakes!"
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