LIVE from Vegas! with Jason Mallette

Guest: Jason Mallette
Topics: Maple Street Biscuit Company, sustainable businesses

Transcript:

Chris Ressa 0:00
This is retail retold the story of how that store ended up in your neighborhood. I’m your host, Chris ReSSA. And I invite you to join my conversation with some of the retail industry’s biggest influencers. This podcast is brought to you by DLC management.

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Ressa 1:09
Welcome to retail retold everyone. I’m Chris ReSSA here with Jason Mallette. From Cracker Barrel and Maple Street biscuit. We are live from ICSE Vegas 2022. Welcome to the show, Jason if you Christian

Jason Mallette 1:23
Thank you.

Ressa 1:24
So this is my first time doing a podcast in Vegas. So I’m excited we got this cool background we got everyone here. How’s your show going?

Mallette 1:34
It’s been great. I got a few blisters but it’s been good so far. How once you get in came in Saturday, it’s been three years so I thought it was it was time to come in maybe a little early and remember with socializing.

Ressa 1:46
All right, that’s fun. Did you get to do the pool and all that fun stuff? Did the pool did a nice reunion dinner with about 12 of my former colleagues we all got together so do we do every Saturday night?

Mallette 1:57
We ICSC and then hit the tables not doing too well. So I

I played blackjack last night and I lost my gambling money in 27 minutes and I’m like what do I do now? I was so frustrated and tried to get it back. I know what you do don’t just drink it your friends. I know it was I liked a good blackjack game I don’t know what you like it’s a we did that night. Jason a mutual friend of ours is up six or $700 I decided to have a few to the ticket was probably 327 seconds. So yeah, I’m probably done game almost.

Ressa 2:37
Okay so you’re with Cracker Barrel and I think everyone knows Cracker Barrel if you don’t know Cracker Barrel. I think everyone knows Cracker Barrel I was gonna say 50 years of knowing Cracker Barrel, the 700 location, right? There’s probably one near and interstate near you,

Mallette 2:56
right. But they have a new concept. Maple Street biscuit. So a couple years ago, we bought Maple Street Biscuit Company they’re based out of or at that time were founded and built out of Jacksonville, Florida, that founder in his executive team are still with us, they actually relocated to Nashville. They’re part of the growth with us. But we’re very excited to have, you know, a concept to be growing, what food breakfast is like the fastest growing segment of all retail. So we’re happy to have a brand new concept within that.

Ressa 3:27
And tell us a little bit about the brand. What is Maple Street

Mallette 3:29
it’s Maple Street, it’s very elevated, don’t I guess don’t necessarily be on a keto diet and try to go find a Maple Street. But it’s very elevated fist is chicken and waffles, shrimp and grits. It’s encourage everyone to go check out the menu. Maybe not on a diet day again. We’re looking for typically 2800 square feet 3000 square foot in caps out in front of your primary daily needs Whole Foods targets AGVs in Texas, Publix is in Florida. Just high profile.

Ressa 4:03
And so this how many locations now?

Mallette 4:07
So the concepts about 50 Maple Street itself has about 50. But under our new model, if you will, our new real estate with Cracker Barrel, acquiring it, we probably have five we’ve got another five set to open between here and the end of the year and maybe more depending on delays. I mean, I think we’re all seeing a lot of flux. You know, a lot of hard times in the sense of deliveries and counting on things but yeah, probably another path

Ressa 4:32
and do is this gonna be a chain that can be as big as Cracker Barrel.

Mallette 4:39
You know, I think it can go sky’s the limit. We’ve mainly been targeting just from Texas to the southeast is trying to make a push into the Midwest. We just signed a lease with Washington prime hear the last few days ago that it will push us into my own. You know, I think realistically in the next five years, maybe it’s 200 to 250 units but over the next 50 years like crack or maybe we could get to 66 or 700.

Ressa 5:03
And I think one of the buzzwords coming into this show was drive thru. Is it drive thru?

Mallette 5:09
No. I mean, I think that’s smart for a lot of concepts of prioritizing apps and the drive throughs and things like that in today’s world. It’s not part of our prototype, but sometimes we’ve incorporated in if we’ve taken a second gen, and there’s a drive through there, but it’s not necessarily part of our model.

Ressa 5:27
Walk us through the location is it waitstaff is it wet talk walk us through

Mallette 5:34
that you’re coming through the door and you’re in you’re ordering up front? With but it’s not a

Ressa 5:40
waiter sit down like a Panera. Boy,

Mallette 5:43
let’s see what I think it’s fun is that it can air you get a little red buzzer right? Yeah, your food’s ready. For us. It’s like that day of the week. It could be like what’s your favorite sitcom? And usually you notice said there’s a lot of like Seinfeld. Seinfeld already sign is like well, is that your food or my food? But we we try to make it fun in the court. That’s right. You know, what’s your favorite? What was it last time I was there? It’s like what was your favorite childhood snack? He’s put me on the spot. So I was like, I think it was like a fruit bar. You know, fruit something roll, roll up roll. Yeah, so we just change it up that way a little bit. And then when your food’s ready, they call out fruit roll up and go get your food sit down so you’re able to kind of come in and and have a great elevated meal but without sitting there for an hour or an hour and a half. You know, waiting for your waiter to get you your food.

Ressa 6:30
I might have said Airheads areas I’ve ever had even that areas. I

Mallette 6:34
mean there’s my my kids would probably tell me a lot of different things Skittles, this and that

Ressa 6:39
areas. I liked Airheads and then I moved into I think Cheetos I went the other way. I went into the salty, cheesy,

Mallette 6:48
I go by my kids everything that I liked, and they don’t it just sits on what are you seeing about

Ressa 6:56
how many kids you have now,

Mallette 6:57
too, so I’ve got a five year old daughter who she’s a character she’s we’ve learned a lot of things through her in COVID but didn’t have a nine year old son who’s actually playing right this second in his playoff baseball game so we’re done here I gotta check in on it

Ressa 7:13
awesome you live in Allen so I imagine it’s got good baseball yes we do have all good all sports.

Mallette 7:20
We do that you know our baseball state or football stadium yeah Kyler Murray. But yeah, we’re undefeated and he got player the game last week and then like I said, we’re first playoff game tonight. What positions you got? Shortstop second base and Sunday like to pitch

Ressa 7:35
Okay, so I have a five year old three year old five year old daughter three year old son so we’re in T ball face with guaranteed buffets.

Mallette 7:43
I kind of skipped that one. But yeah, I was like, I don’t know if I have the patience.

Ressa 7:47
Here. Yeah. So I asked everyone three questions that are somewhat challenging, but put you on the spot a bit. I’m gonna ask him. Are you ready? Yeah. All right. All right. Question one. We call this clear the air. Get to know Jason a little bit question one. What is one skill you don’t possess but wish you did?

Mallette 8:13
You should have the ability to see into the future ever. I like that. Okay, little notre DOM is actually right now. I should say something in the construction world. I wish I had this skill to build electrical meters in an order key electric key in six months in advance, but now I think I wish I had a little more visionary ability.

Ressa 8:32
Okay, I like that question too. When’s the last time you tried something for the first time?

Mallette 8:38
Well, I tell my son that every day I was like even if he said I don’t like that’s like it how do you know if you don’t try it? So actually, I did. I tried something new. Yet the other day I don’t really drink IPA beers. And I’m not I know that sounds crazy. Oh my bourbon god. Okay. And I literally was like, alright, what find what is this whole IPA thing about everybody? It’s like the trendy thing right? So I tried that.

Ressa 9:02
Last question. What is one thing most people agree with but you do not. And I don’t

Mallette 9:11
know. I think waiting for Christmas morning.

Ressa 9:18
Presents. Okay,

Mallette 9:20
I don’t you know, it’s like well, I’ll tell you I’ll change that up there. I think so many people my wife always does this for gifts now. It’s like gift cards right? Yeah. Everybody agrees to give a gift card or cash and I’m like now I actually like the thought of gift and going and do something so I don’t ever do gift cards. I like the feeling to my from my wife. I do experiences like her gift is usually like we went to Nashville this year. Actually, we were here in Vegas in February for the treatment. So I usually gift a an experience with something big for a party not versus here’s the gift card.

Ressa 9:51
I love it. My wife spoiled me. But you golf.

Mallette 9:55
I used to before the two kids okay.

Ressa 9:57
I understand. So my wife I got me a golf trip to Cuba. It’s wasn’t. So I went to Cuba in early April, and got to play ocean course and stuff. It was really cool. If you’ve never been a key why you need to go get around it not not. Not that experience. It was really cool. So I’m with you on the experiences. So when did you guys back to Maple Street when When did you guys buy Maple Street?

Mallette 10:26
It was a little over I think it was in late 2019. You know, kind of before COVID.

Ressa 10:31
And have you gotten to open any of them yet?

Mallette 10:34
Yes. So we’ve, we’ve just opened in Keller, Texas. We’ve got we just opened in the quarry down in San Antonio and Pembroke Pines, Florida. You opened up Pembroke Pines we did. And we’re doing very, very well. They’re very happy with all of them that are opening we just opened Short Pump in Richmond Mark.

Ressa 10:50
Yeah, no. We’ve got we’re going short pump and now Whole Foods center. Yeah, it’s just

Mallette 10:55
it’s on that drag just southwest broad. And yeah, just on the on Broadway. And so that’s it’s been exciting getting these things open. But it’s not an easy time and place to be opening these theaters. Yeah.

Ressa 11:06
Let’s talk about that. So it’s pretty competitive for the type of space you’re looking for. Right? Everyone’s got a new food concept. Everyone wants to be on the Outparcels and visible and cap drive thru type spaces. The in the food sector, right. So and you guys kind of what markets was Maple Street in when you bought them?

Mallette 11:31
Yeah, when they when we require them. They had a nice portfolio that consisted of around Jacksonville, obviously, they had three or four in Atlanta. Chattanooga, they had two or three there. And so mainly in the heart of the deep, you know, traditional south, if you will se the difference, though, today is that they did a little more downtown locations. And like for instance, they’re down in city center in downtown Chattanooga, which is it does really, really well. We’ve just tried to take the model and tweak it a little bit if you will, and be a little more crime in the interest we choose and from the daily needs and on a more regional in nature.

Ressa 12:06
And suburban, right. Yeah, those are a little more urban, right. They are

Mallette 12:10
and we even have done some things in Atlanta for instance, in Woodstock, it’s worked but it was more of interior stuff. And sometimes in the business we’ll call it like E real estate, if you will, and b minus things like that. We’ve just tried to elevate that real estate up to the age. And the food speaks for itself. I mean, you the feedback is just so positive once we get them open and I’ll tell you my my wife, my kids, everybody who just didn’t experience the brand is just loved it.

Ressa 12:35
So did you did you take your family to the one in Keller?

Mallette 12:39
Not yet, because we’ve been it just opened and I’ve been traveling, but we had one in Frisco, Texas, we have one there. And before I accepted the job, I was like, well, we gotta try this out. I mean, honey, and it was kid approved. My twin brother was in town. So it was like 12 of us went to the Maple Street in Frisco. And when everybody left away, like you know, thumbs up, I was like, Okay, I guess I’ll take that job. Okay, I’m thrilled to be helping them grow.

Ressa 13:02
And so the Keller one that was the first one that your team did since you were on the team

Mallette 13:08
I’ve been on board there’s been others that have opened throughout the country that I can’t say there was you know me I’m still waiting for the thing that I’ve been involved with directly. I’ve been involved with helping you get it across the finish line for instance, I was at the Planning and Zoning Commission meeting for Keller the city council meeting for Keller just to make sure we could get that patio approved and you know, it’s just not an easy time we all kind of have to chip in in different ways to get these things open wouldn’t believe and I’m sure other retailers can empathize with what we’re talking about is like the things that are happening that you know concrete is on backorder and H fax going to take you 18 weeks at China to get me it’s just such a hard time but we really put our noses down and figured it out as a team

Ressa 13:50
and it’s a I’m curious how it’s going how Cracker Barrels viewing this because a little bit different real estate strategy Cracker Barrel owns a lot of their real estate.

Mallette 14:02
Yeah, historically and I mean it’s to their two acre sites interstate Yeah, they’re usually eight to 10,000 square foot in tap multi tenant buildings and so it’s different but you know, they’ve been in the business for 50 years and so they’ve got a pretty good understanding of what works and doesn’t for food and restaurant and how to operate but I would say the best thing they’ve done is brought in a great team and you know, people are working family and it’s the best

Ressa 14:28
part and are the is the is it integrated in Cracker Barrel is Cracker Barrel. People working on Maple Street or is it like a separate business integrated?

Mallette 14:38
I mean, I work for Cracker Barrel I would just say on a Maple Street Team, if you will. The maple streets leadership and founder great crew, they have their own executive dynamic and they are office to Nashville with us but very much integrated. But you know, I think sometimes you buy concepts and and then they just go away you know This is a partnership. And it’s been a great

Ressa 15:02
one. Yeah, that’s really cool. And you how are you looking at markets? Because you’re in Pembroke Pines Keller, you’re looking everywhere in the Sunbelt, what do you

Mallette 15:15
we try to be strategic with it? It’s somewhat I mean, it’s easy to prioritize Florida and Texas right now with all the migration that’s been happening into those states. But

Ressa 15:23
but even if you say, Texas, there’s, you can go to a million markets.

Mallette 15:27
Yes. So we were, you know, we wouldn’t go put one just out in Houston without the thought process of having a second, third or fourth or around it. But we’ve been very much I would say, opportunistic in that regard. And I think you get to understand it’s, whenever you’re going to bring in it’s not a race that some you know, it’s not a speed race, it’s a marathon. And so we do have a long term plan to get this this concept up to a couple 100 units or more. And in doing that, we’re taking the best real estate in the best markets, and then we’ll continue to grow around them. But I don’t I don’t think we’re saying hey, you need to go put four here or two here. We’re very much being opportunistic, get to what the quality of sites are.

Ressa 16:09
It’s funny you say that, because I think there’s some brands that would say no, when you have a new brand, you have to go pedal to the metal and open as many as you can, as fast as you can. And, you know, you’re obviously taking a more methodical approach or measured approach than that, not just, you know, spraying stores everywhere will tell you that

Mallette 16:29
I I can say something, and hopefully I’m saying we, you know, I’m thinking that everybody around us in our team feels the same way. But you don’t really have a brand until you’ve actually, you know, until we’ve opened it up and for me, and I think we would be like the next 15 to 20 or 25. And then we’ve got 50 units, I don’t really know, but we have a new real estate strategy, if you will. And so if we’re going to really take this brain to where we think it needs to go the next 1520 25 units, they can’t be like, Oh, well, good. You know, we wish we thought it would be better. You know, things like that. We’re being very methodical in the quality of sites we take. And I once made a joke. And I was joking, I said the word Well, that’s the concession to be in this market. And VP of investment is like, we don’t make concessions or that he joke. But I get it, you know, we attended today with the ones that are making concessions and just trying to meet quotas in store count, maybe go IPO or all that doesn’t mean you’re doing the best deal for your brain. And and so we’re trying to be very qualitative. And

Ressa 17:27
that’s really interesting. Talk to me about the AV, is it similar to how is it comparing to other brands that everyone knows?

Mallette 17:38
Well, I’ll tell you, you know, the stork AUD didn’t earn 3000 square feet, it’s growing with a new real estate that we do. So we have to kind of project what we think the new real estate is going to come out. But we don’t have a lot of data points to say that, but if this is it, but in saying we’re, the brand was here, definitely going to here, and I have direct, so I used to work for FirstWatch for a while and understand their company really well. And per square foot were white right up there or beyond those concepts, other breakfast concepts. So we’re very happy in where we are. But we’ve got to get, you know, 50 locations open in this model to really know what that AUD is going to be. But we’re exceeding per square foot, you know, our own expectations, if you will.

Ressa 18:20
That’s fantastic. The What are the hours?

Mallette 18:26
I think they can fluctuate case by case but typically around 6am to 2pm. Okay, so you know, it’s really that for breakfast, lunch, brunch segment of the business.

Ressa 18:38
And I imagined Saturday, Sunday, big house Monday through Friday.

Mallette 18:43
So I don’t think you can do the real estate that we’re expecting ourselves to get into these gray days stuff. If you don’t have a seven day a week business. And so you’ve got to have a dynamic your weekends are going to be your your, you know, majority call it 50 55% of your business, right? But you’re gonna pay the bills. And the difference between success and let’s call it hitting a single a triple is going to be a having a seven day week business and being able to generate but you know, 40 45% of your business during Monday through Friday also. So in that regard, we do a lot of targeting of daytime populations, employees more young valuating traders are looking for over 50,000 employees within five miles. And so that doesn’t mean we’re near you’re necessarily down the street from your house. We’re near your house, but also your employers and and that’s a Monday through Friday kind of mentality.

Ressa 19:33
I love this segue because it brings me in a hybrid work. How were we figuring out daytime population in this hybrid remote work world?

Mallette 19:42
That’s a good question. Ashley, our director of practical self and our other dealmaker, we’ve taken six I think analytic meetings today. And over the next few days, we’re meeting with all kinds of different groups to kind of dig in on those things in advance. You know, how can we better make site selection decisions? And what information? Are we using the process that I asked that same question today about wold census is 2020. Between 2010 2000 I think it’s sold out. But these are some of the questions I was asking him to. In probably 20 years in this business. I probably took one political or demographic meeting at ICSC. We’re quadrupling that just today. So it’ll be a good question to ask tomorrow.

Ressa 20:28
Yeah. I I’ve been wondering because I think I, I interviewed on a panel, the large F 45 Fitness if you know, the chain franchisee, the franchisee I used to work with, I said, what’s been the biggest change operationally. And he said, I’ve had to hire people daytime, because people are staying home. So I have to have daytime classes because they want to come in during lunch and work out. And that was interesting. Because if you were a business that was focusing on daytime pop, where that person worked before that customers gone, because they don’t go to the office anymore.

Mallette 21:05
I think it’s ever changing. The way that we look at real estate, I think the one safe way to combine those two is that when you’re chasing the daily needs grocery anchored centers to traditionally that means you’re probably near somewhere that residential, and then when you’re targeting the employee counts that we are, you know, I would call it kind of a hybrid site selection, you could go and do a really neighborhood grocery center anywhere, or you could go do the Mall of Georgia, right. But if we’re targeting daily needs, and employee counts, we’re kind of taking the two together and putting them in and that’s I’m excited about we have an location in Katy Texas opening this summer, that is really indicative that it’s very strong heb in cap, great income, it’s dense, it meets all those things that you would find like at Mall of Georgia, right, but it’s convenient to your home. And for me, I look at it as like, what it COVID Teach us is so that we don’t have to leave our houses at all. I really mean even the liquor stores delivering these days. But if you’re going to leave, let’s make it convenient to your grocery and not too far. And I think if you’re gonna go get a cup of coffee, which we have an incredible, you know, napkin seller on beans and hope it’s just a great coffee, coffee selection there. Or you’re getting your breakfast. I feel like it’s convenience too. And it’s close to your home. But if we’re doing that, and 50,000 employees in our evaluation, hybrid again, cool.

Ressa 22:25
Well, we I would argue you need to leave your home if you look at everything. You can’t make money with clicks without the bricks is our biggest thing there. You see the whole tower. So we have this whole branding theme in this show that the store one and you need physical retail for a million reasons. You can read some of the reasons why.

Mallette 22:46
But to your to your point. I mean, I can’t think of a retailer today that is not necessarily an environment when you were told to sit at home but there’s still Yeah, I’ll figure it out. It’s just there was still leaving their homes. I just think it’s more about convenience. Shopping is never going to change you want to get out and feel in touch and in be a part of whatever you’re interacting with. I just think it needs to be convenient to know more so than the past.

Ressa 23:10
Okay. We are at the end of day one of the show. It’s been pretty busy. Our booths been busy. The floor has been busy. I know you’re gonna get back to it. I’m sure you got dinners and everything going on. I got three rapid fire questions for you at the end. And we’re ready. All right. What extinct retailer Do you wish would come back from the dead?

Mallette 23:35
Well, histology wise, it would probably be like a two Toys R Us or something. But I just watched that Netflix show the last block blockbuster. Yeah. And it and we have movie night every Friday night with my kids and I came out of COVID. And so to be able to take them to go pick out their candy at a blockbuster and do that thing.

Ressa 23:55
Yeah, it was there. That it’d be blockbuster. Okay. You ever go to the movies with them?

Mallette 24:01
Yeah, we I mean definitely another reason it would be nice to have blockbuster. It’s like 70. And they have to have the KT the drinks and popcorn but that’s our kind of our treat with the kids in movies once a week.

Ressa 24:12
All right. Question two. What is the last item over $20 You bought in a store?

Mallette 24:19
I told you my five year old girl is is you know she’s energetic and all those things but she graduated Pete pre K last week. I was like, Well, honey, we gotta get her something as a gift and like what does she likes? She loves WWE wrestling. Watching them with me all the way back to like 1985 with Junkyard Dog and Jake the Snake Roberts.

Ressa 24:41
Oh my god. We found her Macho Man, Randy Saturday, the ring

Mallette 24:45
setup and all that kind of stuff. And so that was it. And I was like this is over 20 works. We’re just a little bigger. But she just eats up. In fact, last week we had what are you going to be like future job addresses which you want to be she dressed up as Ronda Rousey with All right w russellian Bill

Ressa 25:01
oh my god she’s she’s she’s a character last question if you and I were shopping at Target and I lost you what I would I find doing

Mallette 25:15
pretty good what is said probably trying to find the Pokemon cards for my son are the wrestling for my daughter but my wife recently bought me one of those vinyl record players and I didn’t know that I was gonna like it. Oh my god, I’ve been catching myself every time I’m in those stores with the habit and they’re there I didn’t even know there was an aisle for it. But yeah, I go shop the vinyl records selection and see if I find something that kind of just, you know, again, this is a you know, something I want to get into. So yeah,

Ressa 25:39
excellent. Well, Jason, you’ve been great. Thank you for coming on the show. Thank you for doing this live in Vegas. I hope our team makes the deal and Alan and good luck Good seeing you too. You too. Thank you. Thank you for listening to retail retold. If you want to share a story about a retail real estate deal that you were a part of on our show. Please reach out to us at retail retold at DLC mgmt.com This show highlights the stories behind the deals from all perspectives. So it doesn’t matter if you are a retailer, broker, entrepreneur, architect or an attorney. Also, don’t forget to subscribe to retail retold so you don’t miss out on next Thursday’s episode