Flower Child: Owned By Cheesecake Factory And Expanding

Food & Drink

Sam Fox who launched Fox Restaurant Concepts has been an innovator and disrupter who once launched 15 independent eateries. Never one to duplicate himself, one of his eateries is called Flower Child known for its hippieish-style (hence its name), healthy menu, consisting of salads, grain bowls with chicken and avocado hummus.

“Healthy food for a happy world” was its tagline. But as Flower Child started to expand, Fox sold it and his restaurant firm including North Italia to Cheesecake Factory (NASDAQ-Cake) in 2019 for $308 million, as a subsidiary, keeping him on to run it.

Fox made a name for himself when he debuted True Food Kitchen in 2008, partnering with Dr. Andrew Weil, which grew to 35 locations in 15 states.

Why did Fox sell to Cheesecake Factory? He replied, “We were in hyper-growth model. But it was capital intensive and human intensive, and it was a good fit. They first made an investment in two of our brands,” and that he suggests turned into a “marriage.”

Despite its change of ownership, Flower Child continues on a growth path, and all are company-owned, none franchised.

Cheesecake Factory On A Revenue Surge

Over the last few years, Cheesecake Factory has been on a roll, boosting revenue from nearly $2 billion in 2020 to $2.9 billion in 2021 and $3.3 billion in 2022. In 2022, sales at Cheesecake Factory rose 10% from the previous year, 33% at North Italia and 30% for its Fox Restaurant Concepts.

Where Fox Fits Into Its Parent Company

Its 2022 annual report described Fox Restaurant Concept as its “incubation engine, innovating new food, dining and hospitality experiences to create fresh, exciting concepts for the future.” It described Flower Child as offering “fast-casual dining, a customizable menu, made fresh from scratch, featuring locally-sourced, all-natural and organic ingredients.”

Currently there are 31 Flower Child locations in 11 states including Washington, D.C., and moving to 12 states when its Salt Lake City outpost opens in 2024. And it expects to open 6 more locations in 2024.

Unlike most restaurant chains, which expand through franchising, every Flower Child eatery is company-owned. Although Fox says the concept could be “franchishable,” he says, maintaining ownership is like teaching your kid to ride a bike or drive, so it gives you more “control over the outcome. We believe in the restaurant and brand so why not own it all and grow it all?”

It has also kept its prices moderate as most bowls cost $11 to $15, salads in the $10 to $14 range, and protein with two sides for about $12 to $16, so a $15 meal with beverage is possible.

Fox says they’ve kept their prices in check because they have “buying power with vendors and know our markets.

Appealing To A Wide Demographic

Anita Walker, Fox Restaurant Group’s vice president for marketing, says Flower Child appeals to a wide demographic “from vegan to keto to indulgent and to people on the go at lunch, casual dining for families, or following a workout.”

Most Americans gravitate toward burger, taco and pizza restaurants, so where does Flower Child fit it? Fox replied, “People’s dining habits are changing and evolving. If you look at the landscape, I could name thousands of burger/taco/pizza eateries, but only one or two similar to Flower Child.”

“We’re giving people another option to dine out,” he says succinctly. Fox grew up in a restaurant culture, since his dad Aaron Fox owned Hungry Toni’s deli in Chicago, and then a café and Mexican eatery in Tucson, Arizona, when they moved there.

Fox describes what Flower Child offers as “elevated fast-casual,” which includes staff bringing a guest’s meal to the table, clearing food away, and having several staff to help customers in the dining room.

Looking into the future, he expects to continue to look for appropriate real-estate and grow the brand in existing markets and new markets.

Since Cheesecake Factory took over ownership, the transference of ownership has been seamless. “I couldn’t tell much difference if they owned it or I did,” he acknowledges. Hence it’s not comparable to having private equity ownership, which would tinker with the success, and then, eventually cash out.

Asked the keys to the sustained success of Flower Child, Fox replies: 1) Our people, 2) Development of innovative great food, 3) Executing the food.

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