|Recent improvements include a move to fresh salmon that is hand-cut in the restaurant.|
MARYVILLE, TENN. — Ruby Tuesday has invested in making its food taste better. Challenged by lagging traffic and sales during the recent quarter, executives of the casual dining chain discussed initiatives to improve the quality of existing menu items through the supply chain and product preparation.
“That’s not about selling higher-priced items,” said J.J. Buettgen, chairman, president and chief executive officer, during a Jan. 8 conference call with financial analysts. “It’s about improving the execution of the recipes that we currently have, but also doing some things to refine both our execution, our food quality, in terms of product coming in the back door, to continue the progress we’ve made on our food quality and food taste scores.”
Improvements over the past year include a move to fresh salmon that is hand cut in the restaurant and fresh ground beef. Despite industry trends, however, executives said not to expect organic or locally grown produce debuting on the salad bar anytime soon.
“We are pretty focused on food quality (but) not necessarily, at this point, on local/organic,” Mr. Buettgen said. “We continue to monitor the trends like everybody else and want to see how important it becomes and whether or not we feel it would be a fit for us sometime in the future.
“Not in the near term.”
|Ruby Tuesday is strengthening its dessert and drink offerings.|
Forthcoming innovation centers on the chain’s drink and dessert menus. In the coming months, Ruby Tuesday is introducing new alcoholic beverages and desserts in hopes of increasing add-on sales.
“If you were to look at our brand versus some of our competitors, whether that’s casual dining at large or a bar and grill, we under-index some of the others in both alcoholic beverages and desserts, so we’re strengthening those offerings,” Mr. Buettgen said.
For the second quarter ended Dec. 2, 2014, the chain reported a net loss of $9,273,000, which compared with a loss of $34,383,000 in the year-ago period. Results benefited from cost savings initiatives and efficiency improvements in the business model.
Revenue totaled $262,659,000, down 4.9% from $276,209,000 in the comparable quarter, reflecting the closing of 42 restaurants and a 1% decrease in same-restaurant sales.
“Our check growth lagged the industry during the quarter as we continue to invest in affordability and promotional efforts,” Mr. Buettgen said.
Traffic fell 1.3% compared to the prior-year quarter. The company attributed the softer results to the impact of lapping last year’s successful menu launch as well as lowered marketing spend.“As we look to the back half of the fiscal year we’re focused on regaining sales and guest count momentum and driving continued improvements in food quality and guest service,” Mr. Buettgen said. “Our culinary, marketing and operations teams will continue to introduce creative new menu items that we can execute with excellence. We will be introducing new product news in beverages and desserts in the back half of the year, to improve our offerings in those areas and to increase add-on sales and overall check.”