BJ's Restaurants Ends 2017 With An Outlet Launch In Michigan

Like most U.S. restaurant chains, BJ’s Restaurants, Inc. (NASDAQ:BJRI) is facing the brunt of soft consumer spending. The company believes that greater focus on traffic and sales building initiatives will help it counter the challenging sales environment.

Although the company slowed down its expansion plans for 2017 and 2018, it has not entirely refrained from unit growth in the year.

In regard to this, BJ’s Restaurants recently announced the opening of its first restaurant in Taylor, MI. Located at the Southland Center, the 7,500-square feet BJ’s Restaurant & Brewhouse seats approximately 230 guests and features a wide-ranging menu.

The Taylor restaurant is the last store to be opened by the company this year, reaching the current-year restaurant count to 10.

Efforts to Counter Challenging Sales

The company plans to open only four to six restaurants in 2018. The curtailment in openings might further dent the company’s sales in a space that is dominated by big names like Yum! Brands, Inc. (NYSE:YUM) , McDonalds Corporation (NYSE:MCD) and Papa John’s International, Inc. (NASDAQ:PZZA) , among others.

Notably, BJ’s Restaurants shares have lost 8.8% year to date, while its industry grew 14.3%.

The company’s decision to slow down openings for some time and instead focus more on enterprise resources to drive sales might turn out to be favorable providing momentum to margins and free cash flow. When combined with the company’s conservative balance sheet, these measures are likely to provide more flexibility for sales building capital and share repurchases.

BJ’s Restaurants is focused on sales building strategies that can help drive the top line. By implementing these strategies, the company aims to differentiate its food quality and uniqueness, improve speed of service and redefine its brand messaging and media strategies.

Menu innovation continues to be the restaurant’s major traffic-building strategy. The company has developed a robust pipeline of menu items, including several new items focused on its EnLIGHTened menu category, featuring new super food options. Its slow roast menu also continues to drive healthy check growth.

Moreover, given the fact that off-premise sales represent a considerable revenue growth opportunity, the company has been undertaking various efforts to enhance delivery and take-out services. In fact, it intends to leverage its high rated mobile app and website, along with new third-party delivery partners to drive growth in off-premise sales. Resultantly, off-premise sales grew roughly 17% in the third quarter and is further increasing on incremental sales and traffic.

The company expanded its daily Brewhouse specials, which showcase several of its popular signature menu items at attractive prices.This is likely to drive traffic further for this Zacks Rank #3 (Hold) company. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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