Military partnership benefits restaurant
Charley’s Grilled Subs’ relationship with the U.S. military is helping it expand and add locations overseas.
The Columbus-based restaurant chain opened its 100th restaurant on a U.S. military base last week.
And so far this year, the company, which specializes in Philly cheesesteaks, opened locations in the Dominican Republic and Brazil and is in talks to enter South Korea, Bahrain, Saudi Arabia and Central America.
The company’s 12-year partnership with the Army & Air Force Exchange Service not only allows it to serve its food to U.S. soldiers and their families worldwide, but also helps to promote the brand in countries it might not otherwise have entered, said Bob Wright, Charley’s chief operating officer.
The company has nearly a quarter of its roughly 400 restaurants on military bases in the U.S. and around the world.
“We see international a significant part of our growth,” Wright said, noting that the company has benefited from the “worldwide shift toward capitalism and the consumerism that goes along with it.”
“Mall development is growing around the world, and you see the same kinds of food courts that exist in the U.S. and the same desire to sit down with your family to eat. It’s been a great growth opportunity for us.”
The company is among the top 100 limited-service sandwich chains in the U.S., according to Technomic, a Chicago restaurant- and food-research group.
Charley’s presence on military bases is a good strategy for the company’s growth, both domestically and overseas, said Darren Tristano, Technomic executive vice president.
“The big challenge in the restaurant industry is to focus more globally, and for a chain like this, a premium sandwich category, it is important to expand internationally,” he said.
“And the strength that (Charley’s) builds with having locations on military bases helps to build the brand with a younger audience of (troops and their families) who will become loyal and continue to buy the brand after their military career is over.”
Charley’s Grilled Subs opened 38 stores last year, a majority of which are in airports, on military bases or in regional shopping malls. The company had sales of $220 million in 2009, a 15 p ercent increase from the previous year, Wright said.
The privately owned company typically adds 40 to 50 units in a year, he said, noting that the company is on pace to open 46 this year.
That’s been accomplished by converting existing restaurants or retail spaces into Charley’s restaurants. Conversions typically cost $130,000, compared with $300,000 to open a location from scratch, Charley Shin, the company’s president, has said.
Most of the stores are franchises, with the Army and Air Force service being the company’s largest franchise partner.
The group has “been a terrific partner to help us leverage the popularity of our sandwiches throughout the world,” Shin said in a statement.
“Fresh food really resonates with people no matter where you are in the world,” he said.