Roark Acquires Passion, Authenticity at Jim ‘N Nick’s Bar-B-Q
The Roark team must have a soft spot for the name Jim. In its latest restaurant acquisition, the private equity firm acquired Jim ‘N Nick’s Bar-B-Q.
At 37 units across Southern states, it's a far cry from Roark’s Jimmy John’s deal, but according to Geoff Hill, a principal at the firm, the acquisition is right on trend for consumers and investors who are looking for authenticity. The segment has gotten a lot of attention lately because it's something people crave and it ticks all the boxes for what consumers look for in a brand.
“I think you have to be authentic to win and do well. I think at the end of the day, barbecue is a stable category that is known—you can think of it like ice cream—everyone knows barbecue and everybody likes it. But when they go and eat it, they want it done well,” said Hill, noting that authenticity and scale is tricky. “They’re at 37 locations now, and it’s still authentic barbecue. That’s where I give a lot of credit to Jim and Nick and our CEO, they have figured out how to keep it passionate an authentic.”
The Atlanta-based Roark team was already familiar with the brand (the cheddar biscuits are a favorite), so when they were approached to get involved it didn’t take much convincing. And co-founder Nick Pihakis said Roark’s commitment to that authentic core of the business made the firm an ideal partner.
“It was important for us to find a private equity partner that is aligned with our commitment to high quality, fresh barbecue and Southern cuisine,” said Pihakis in a press release. “Roark is a highly-respected PE firm, with a strong track record of investing in restaurant brands to position them for sustainable long-term growth. They are an ideal partner for us to reach our expansion goals, while remaining true to our extremely high quality standards.”
Those company standards have been around since the '80s, and are the same initiatives big brands are moving toward and taking credit for lately. The restaurants have no freezers, most everything is made from scratch and the meats and sides are made from high-quality ingredients.
It’s the same thing Arby’s strives for under Roark. Under the firm’s control, authenticity became rule No. 1. The middling dinosaur rebounded, becoming a unique and differentiated QSR juggernaut that has grown average unit volumes 20% since 2013.
Unlike many restaurant brands out there, near everything is already in place at Jim ‘N Nick’s, the recipes are tried and true, the customers are fanatically devoted, and it’s staffed by employees passionate about meat, smoke and char. And as the race for convenience rips the industry asunder, brand leaders can stay focused on executing since they’ve been convenience all along.
“The second piece was the differentiation of the box itself, you have not only dine-in opportunity where they do a lot of business, they also have a drive-thru, they’ve got to-go and they’ve got catering. When you look at those pieces you are basically covering the spectrum for the consumer,” said Hill. “We believe that was important for consumers who say, 'I want great, I want authentic, but I want it the way I want it.'”
Hill wouldn’t say what the spread between on- and off-premise sales are at Jim ‘N Nick’s, but to-go orders are up 2.9% year to date across the industry, according to TDn2k. As for the third-party quandary, Roark is exploring possibilities across all its brands with a close eye on product quality.
What’s next for the 37 locations across Alabama, Colorado, Florida, Georgia, North Carolina, South Carolina and Tennessee? Hill says the first several months will be dedicated to pulling the brand out of its former parent company, Good Smoke Holdings. The company was created when Jim ‘N Nick’s and Dinosaur BBQ formed a partnership with Syracuse, New York-based Dinosaur BBQ in 2014. Getting the brand out of the shared Dallas office is a big priority.
“We have to take all that back from Dallas and bring it to Birmingham where it was initially. That’s Nos. 1-10,” said Hill. “Our goal is to have it all done over the next several months.”
Despite Roark’s capital behind the brand, don’t look for a Jim ‘N Nick’s on every corner just yet. There are no plans to franchise the concept and with more than 2,000 company locations across the now 20 restaurant brands, Roark is happy to operate and glean insights from direct consumer activity. Growth will be deliberate and methodical.
“We will grow most likely where we already are, there’s plenty of room in the Southeast for the brand in the states we’re in,” said Hill. “We’re not into jumping across the country with our brands, so we’re not going to do that with this either.”
Current COO Brian Lyman will continue his 12-year tenure at the brand as president. Phil Hickey, formerly CEO at RARE Hospitality and chairman at Miller’s Ale House (another Roark company), will serve as chairman.
Terms of the deal were not disclosed.