Q: What were the challenges?
A: When you add doughnuts, labor is huge and you're still selling things for $2 or less. It might have worked OK, but it wouldn't have been a business model to replicate. Then someone came up with the idea of fried chicken and it just sort of clicked.
Q: What part of your customer base is doughnut, vs. chicken?
A: I think it's the same customer. Maybe the doughnut people are a little bit more laid-back and the chicken people are a little bit more ready to get into the scrum.
Q: What are the keys to growing the business?
A: The customer mix is good, so you have your morning coffee-and-doughnuts, you have your lunchtime and dinnertime fried chicken, and real estate is inexpensive. So it's attractive economics, although people would be surprised by how much it costs to make doughnuts.
Q: What do you mean?
A: Our doughnuts could be 50 cents of hard costs, not factoring in oils or shortening plus a nickel for flour. We use chocolate, a lot of butter, dairy, eggs-fairly expensive things. We were conscious of how we priced things. We didn't want to become a $3 doughnut.
Q: How many jobs?
A: We always seem to need twice the employees we hire for an opening. We have about 10 full-time people at the new store and six at the first store, plus a general manager and corporate chef who oversee both stores.
Q: What's your biggest challenge going forward?
A: Few people want to get up at 3 a.m. to make doughnuts.
Contact Michael Hinkelman at firstname.lastname@example.org or 215-854-2656. Follow him on Twitter @MHinkelman.