When it comes to the roughly 900-square-foot Dutch Bros. Coffee, Portillo’s CEO and president Michael Osanloo has box-size envy.
So Osanloo said to Dutch Bros CEO and president Chistine Barone in a CEO v. CEO executive exchange at the Restaurant Leadership Conference in Phoenix on Monday.
The roughly 1,000-unit Dutch Bros. recently announced the admittedly audacious goal of reaching 2,029 units by 2029, doubling its unit count. The drive-thru coffee chain sees room for more than 7,000 stores nationwide, an expansion of the 4,000-unit target as of its 2021 IPO.
The close to100-unit Portillo’s, meanwhile, is growing at a comparatively more modest pace, with 12 new restaurants planned this year as the Chicago-based chain expands across the Sun Belt. But the 60-year-old brand, which has some restaurants in Chicagoland up to 14,000-square feet, is shrinking its format as the fast-casual chain grows.
Last year, Portillo’s began opening Restaurant of the Future format units that are about 6,250-square feet, down from the more traditional 7,000. And a Restaurant of the Future 2.0 format is coming that will shrink the footprint even smaller—though not as small as Dutch Bros. tiny drive thrus.
“I envy the heck out of your size box,” he said to Barone.
Both brands shared their respective journeys with digital technologies.
Dutch Bros. in the fourth quarter rolled out mobile ordering, and it already accounts for 10% of transactions, Barone said. The units have both drive-thru pickup and walk-up windows, and, between the two, more mobile orders are moving through the walk-up windows. “There are lots of good things we’re learning,” she said.
Portillo’s recently launched a new loyalty program that lives in the digital wallets of consumers and offers personalized messaging. “It’s about keeping up with the customer,” Osanloo said. “Our strategy with digital is I want to meet the consumer on their terms in a frictionless environment.”
On menu innovation: Dutch Bros. recently had a two-day limited-time offer called a Pickleback Rebel around April Fool’s Day that turned out to be a traffic driver.
Portillo’s is testing breakfast offerings in five Chicago stores, including iced coffee and doughnuts made with the brand’s signature chocolate cake, as well Polish sausage sandwiches with giardiniera.
Osanloo said he takes a Darwinian approach to menu development. If the dish doesn’t perform, it’s fair game for the chopping block.
“The strong kill the weak,” he said.
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