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OC Chains Shake Up Leadership, Locations

Orange County’s diverse base of restaurant chains has added executives, menu items and locations over the past several years, and those changes appear to be paying off.

The top 29 restaurant companies based in Orange County saw double-digit revenue gains last year, with systemwide sales reaching $32.7 billion in 2022, according to Business Journal data. That marks a nearly 12% jump from the year prior.

Several of those chains have or are getting new leaders overseeing growth including El Pollo Loco, No. 5 on the list; Habit Restaurants, No. 7 on the list; California Pizza Kitchen, No. 8; Kura Sushi USA, No. 17; and Flame Broiler, No. 23 on the list.

Overall, OC’s top restaurants employ 21,542 in Orange County, up 4.5% from 2021, and count 638 locations in the county, up from 628 in 2021.

New openings grew at a faster clip outside of OC, with systemwide locations increasing 5% to 15,777.

The two largest local chains—Taco Bell and Chipotle Mexican Grill Inc. (NYSE: CMG)—maintained their top spots in this year’s list and grew their global footprint by the hundreds.

OC’s largest chain, Taco Bell of Irvine, counted 8,276 total locations as of April, and boosted revenue by 10% to $14.7 billion last year.

Newport Beach-based Chipotle, meanwhile, added nearly 200 locations in the past year to reach 3,200 total stores while revenue surged 14% to $8.6 billion. The firm is now the most valuable publicly traded company based in OC, with a market valuation of $57 billion.

The two leaders far outpace the rest of the pack, with the next largest chain by locations, Lake Forest’s Del Taco Restaurants, counting about 600 locations, while the third-largest chain by revenue is In-N-Out Burger of Irvine, reported $1.8 billion in 2022.

Orange-based King’s Seafood Co. with sales of $223 million and Costa Mesa’s Panini Kabob Grill with $132 million recorded the highest sales increases among the chains, up 27% and 21%, respectively.

“In 2022, we extended to new markets, with restaurants in Denver and Bellevue, Wash.,” King’s Seafood’s Chief Executive Sam King said of the increase. “We also experienced continued interest and build out of our private dining program.”

C-Suite Shakeups

Updates in the last year included changes to multiple executive line-ups.

Santa Ana’s Flame Broiler added founder Young Lee’s two sons as officials in January to help digitize the rice bowl chain, with Christian Lee named chief operating officer and Daniel Lee named chief marketing and technology officer.

Irvine’s Habit Burger Grill added several new industry veterans to its leadership team following its $375 million sale to restaurant giant Yum Brands Inc. (NYSE: YUM), owner of Taco Bell, KFC and Pizza Hut and one of the world’s largest restaurant operators, with a valuation now near $35 billion.

Shannon Hennessy transferred from KFC to The Habit last fall and will take over as CEO from Russ Bendel in June upon his retirement (see story, page 53). A fellow KFC alum, Jack Hinchliffe, joined the burger chain this year as global chief marketing officer.

Recent top-level changes include a new CEO for Costa Mesa-based California Pizza Kitchen, Jeff Warne, who previously served on the company’s board of directors.

Other C-suite shake-ups include a new CFO for Irvine’s Kura Sushi, Jeff Uttz, who hails from popular burger chain Shake Shack, which will open its first OC location this month at the Irvine Spectrum Center.

Costa Mesa’s El Pollo Loco (Nasdaq: LOCO) added Maria Hollandsworth, who previously hailed from Dunkin’ and Jack in the Box, as chief operating officer.

Employee Initiatives

Leaders from the likes of Chipotle and El Pollo Loco are looking to improve in-store operations through better training and programs for workers.

Chipotle’s Chief Executive Brian Niccol described its current strategy, dubbed Project Square One, as “going back to the basics” of its operations by keeping restaurants fully stocked and operational from open to close, especially during peak periods of the day.

El Pollo Loco, with a local headcount of 1,424, implemented a revamped onboarding program this month to simplify the process for new employees. Chief Executive Larry Roberts told analysts that 97% of restaurants are fully staffed as of March.

Sales for the chain rose 6.8% to $1 billion as of the end of 2021.

Menus, Locations

Other chains are looking to their store menus and designs to capitalize on gains.

Last year, the return of Taco Bell’s fan-favorite Mexican Pizza drove higher-than-expected demand, with ingredients selling out within two weeks.

Huntington Beach-based BJ’s Restaurants Inc. (Nasdaq: BJRI) is planning to remodel over 30 restaurant dining rooms this year, and plans to revamp its menu in July.

BJ’s came in at No. 4 reporting $1.3 billion in 2022 sales with 18% growth; Chief Executive Greg Levin is gunning to reach $2 billion in the next several years.

On the physical expansion front, Cypress-based Xperience Restaurant Group, which moved up three spots to rank No. 11 on this year’s list, entered into a new market this year acquiring two Texas-based concepts in March.

The operator, which reported a 7.5% sales bump to $285 million, is aiming to reach 100 locations through similar large-scale acquisitions.

In-N-Out Burger in January announced plans to expand into eastern territories for the first time, and is developing a corporate hub in Tennessee to meet that goal.

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Sonia Chung
Sonia Chung
Sonia Chung joined the Orange County Business Journal in 2021 as their Marketing Creative Director. In her role she creates all visual content as it relates to the marketing needs for the sales and events teams. Her responsibilities include the creation of marketing materials for six annual corporate events, weekly print advertisements, sales flyers in correspondence to the editorial calendar, social media graphics, PowerPoint presentation decks, e-blasts, and maintains the online presence for Orange County Business Journal’s corporate events.
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