Chili's 2015 Annual Report Download - page 9

interior of all locations transport our guests back to a classic Italian-American restaurant in the style of New
York’s Little Italy in the 1940s. Our Maggiano’s restaurants feature individual and family-style menus, and most
of our restaurants also have extensive banquet facilities designed to host large party business or social events. We
have a full lunch and dinner menu offering chef-prepared, classic Italian-American fare in the form of appetizers,
entrées with bountiful portions of pasta, chicken, seafood, veal and prime steaks, and desserts. Our Maggiano’s
restaurants also offer a full range of alcoholic beverages, including a selection of Handcrafted Classic Cocktails
and premium wines. In addition, Maggiano’s offers a full carryout menu as well as local delivery services.
During the year ended June 24, 2015, entrée selections ranged in menu price from $12.95 to $42.50. The
average revenue per meal, including alcoholic beverages, was approximately $27.00 per person. During this
same year, food and non-alcoholic beverage sales constituted approximately 83.0% of Maggiano’s total
restaurant revenues, with alcoholic beverage sales accounting for the remaining 17.0%. Sales from events at our
banquet facilities made up 18.7% of Maggiano’s total restaurant revenues for the year. Our average annual sales
volume per Maggiano’s restaurant during this same year was $8.6 million.
Business Strategy
We are committed to strategies and initiatives that are centered on long-term sales and profit growth,
enhancing the guest experience and team member engagement. These strategies are intended to differentiate our
brands from the competition, reduce the costs associated with managing our restaurants and establish a strong
presence for our brands in key markets around the world.
Key economic indicators such as total employment and consumer confidence continued to improve steadily
this year and have driven slight improvements in the casual dining industry; however, growing sales and traffic
has been a challenge over the last five years with steadily increasing competition. U.S. economic growth has
been steady but wage growth has been slow and this wage pressure has challenged both restaurant operators and
consumers as discretionary income available for restaurant visits has been limited. In response to these economic
factors, we have developed strategies that we believe are appropriate for all operating conditions and will provide
a solid foundation for earnings growth going forward.
We have completed a number of significant initiatives in recent years that have helped us drive profitable
sales and traffic growth and to improve the guest experience in our restaurants. Investments in restaurant
reimages, new kitchen equipment and operations software have improved the relevance of the Chili’s brand and
the efficiency of our restaurants. Our new kitchen equipment enables us to provide a higher quality product at a
faster pace, enhancing both profitability and guest satisfaction. Our Chili’s reimage program is complete and the
design is intended to revitalize Chili’s in a way which enhances the relevance of the brand while staying true to
Chili’s brand heritage. All company-owned Chili’s and Maggiano’s restaurants are now operating with an
integrated point of sale and back office software system that was designed to improve the efficiency of our
restaurant operations and reporting capabilities. We believe that these initiatives will positively impact the
customer perception of our restaurant in both the dining room and bar areas and provide us with a great
foundation for continued success.
We have also differentiated the Chili’s brand by leveraging technology initiatives to engage our guests and
drive traffic. All traditional domestic Chili’s restaurants, with the exception of airport and college locations, are
now outfitted with tabletop devices which gives us the largest network of tabletop devices in the country. Our
Ziosk branded tabletop device is a multi-functional device which provides entertainment, ordering, guest survey
and pay-at-the-table capabilities. We built on this momentum by launching the Chili’s loyalty program called My
Chili’s Rewards in the fourth quarter of this fiscal year which utilizes our existing tabletop technology and
provides us an opportunity to connect with our guests in a meaningful way to tailor their experience in our
restaurants. We are also investing in additional upgrades to our on-line ordering and mobile platforms. We have
also launched No Wait, a new technology which allows our hosts to provide more accurate wait times when a
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