After Rough Start To Fiscal 2012, Ruby Tuesday Unveils New Plans To Bounce BackOctober 11, 2011
Last November, restaurant chain Ruby Tuesday seemed to be reemerging as a major contender in the casual dining segment. Business was thriving, thanks to a revamped menu focused on freshness and quality ingredients as well as a greater commitment to beverage alcohol. But this year has been difficult thus far, as Ruby Tuesday posted a 75% drop in net revenues to $3.1 million in its fiscal first quarter ended August 30th—down from $12.4 million in the year-earlier period. Same-store sales at company-owned units fell by 4.1%.
This month, Ruby Tuesday is testing new menus targeted at budget-conscious customers. The company also has begun converting under-performing Ruby Tuesday units into other company-owned brands such as Marlin & Ray’s, Jim ‘N Nick’s Bar-B-Q, Truffles Café and Wok Hay. Ruby Tuesday also is opening a new Lime Fresh Mexican Grill unit in Huntsville, Alabama this month, and it plans to launch new Lime Fresh locations throughout Washington, D.C., Atlanta, Alabama and Tennessee. Ruby Tuesday last year reached a deal with Lime Fresh Mexican Grill to franchise the brand, with long-range plans to open as many as 200 units.
The company says it will close three to five owned restaurants over the next eight months, while also converting six to eight underperforming locations into other owned brands. Further plans call for the opening of a new Truffles Grill unit and six to eight Lime Fresh Mexican Grill units, according to vice president of finance Greg Ashley. Ruby Tuesday estimates that same-store sales will be down 2%-3% in its fiscal second quarter, which would mark a modest improvement over first quarter results.Subscribe to Shanken News Daily’s Email Newsletter, delivered to your inbox each morning.
Tagged : restaurants