Hospitality Sector Trends Shaping 2026

We talked a bit before we started about LinkedIn, and I've got a post teed up to follow this next week about what the playbook is likepoint by pointfor growing a business. To me, among the essential things, and I feel extremely fortunate, is that both brands I have actually been involved with are distinct.

And there's absolutely nothing exactly like Chop Shop in terms of what we're making with a large, diverse menu. A lot of brands today are really singularly focused in regards to what they're using from a foodstuff. I seem like we began at a benefit with both brands by having something special that filled a niche nobody else was doing.

Because it's just harder to stand out when there are 10, 20, 50 ideas within a two- or three-mile radius trying to do the specific same thing. A lot of it starts with the brand name. Does your brand name have something distinct that no one else is doing? That's unusual.

The second thingI came from a financing background, so a lot of my learnings are more financing and data-driven versus a lot of early start-up restaurateurs who are innovative types. They love the food, they constructed the menu, they developed the brand.

They do not understand their breakeven sales. They don't comprehend how margin enhances as sales increase. They don't comprehend cash-on-cash returns. I have actually seen numerous companies where the numbers simply don't work. And yet individuals say: let's open 10 more. And I'll state: why? It doesn't earn money. Stop. You need to find a concept that is special.

How to Expand a Restaurant Concept

If you do not have those 2 things, you should not be developing shops. Yeah, possibly both? Because as I hear your description, you've highlighted three things: execution, brand distinction, and monetary viability. You have actually got to start with execution. If you do not have an operating design that works, expanding it simply increases issues.

Second, you need an engaging brand name or distinct idea that resonates with customers. And another essential lesson is about getting in brand-new markets.

But when we expanded to Dallas, I anticipated brand-new stores to do 5070% of Phoenix sales in the first year. A lot of operators assume new markets will open at full volume day one. That practically never takes place. And when the stores open sluggish, but you have actually signed leases and constructed a monetary design based upon higher volumes, you get overextended.

Otherwise, they get rose-colored glasses about success in the home market and presume it will translate rapidly. You pointed out expecting 5070% volumes. That's sobering. I have actually even seen cases where it's just 2530% at launch. It highlights how important capital structure is. Yes. Most little development principles like ours count on equity, not financial obligation.

Freddy's Frozen Custard & Steakburgers

Corporate Growth Milestones for 2026

So you require equity sponsors who think in the vision and the team. Another lesson: you need to open 4 to 6 stores in a new market within 2 to three years. That's expensive, however it produces emergency, builds awareness, and justifies above-store leadership. Without it, you remain slow and unprofitable.

At Chop Store, we deliberately developed strong bases in Phoenix and Dallas first. That offered us the profitability to withstand sluggish starts in Houston and Atlanta. And we were fortunate that Dallasour second marketwas likewise where our team lived. Having the whole group in-market to support stores, hire, and guarantee culture was big.

People often undervalue how critical team is to scaling. Our group took all the things we hated from previous jobsfeeling underappreciated, underpaid, growth-stifledand built the opposite culture here.

Hospitality Sector Shifts Redefining 2026

Otherwise, they get rose-colored glasses about success in the home market and assume it will equate rapidly. You mentioned anticipating 5070% volumes. I've even seen cases where it's just 2530% at launch.

You need equity sponsors who think in the vision and the team. That's pricey, but it produces vital mass, constructs awareness, and justifies above-store management.

And we were lucky that Dallasour second marketwas likewise where our team lived. Having the entire team in-market to support shops, hire, and ensure culture was huge.

Freddy's Frozen Custard & Steakburgers

Individuals often undervalue how critical group is to scaling. How have you approached building and scaling your team? This is something I'm really proud of. Our group took all the things we disliked from past jobsfeeling underappreciated, underpaid, growth-stifledand developed the opposite culture here. We stress growth frame of mind and career pathing.

Otherwise, they get rose-colored glasses about success in the home market and presume it will equate quickly. You discussed anticipating 5070% volumes. I have actually even seen cases where it's just 2530% at launch.

Freddy's Frozen Custard & Steakburgers

Significant Market Milestones Shaping 2026 Expansion

You require equity sponsors who think in the vision and the team. That's pricey, but it produces critical mass, develops awareness, and justifies above-store management.

And we were lucky that Dallasour second marketwas also where our team lived. Having the entire team in-market to support shops, hire, and guarantee culture was huge.

People typically underestimate how important group is to scaling. Our group took all the things we disliked from past jobsfeeling underappreciated, underpaid, growth-stifledand developed the opposite culture here.