Dive Brief:

• Dickey's Barbecue Pit will open its first host kitchen location with Franklin Junction later in October, the companies announced Wednesday.
• The chain aims to open 25 host kitchen locations by the end of the year. 
• Dickey's has been ramping up its delivery-only offerings of late, partnering with Combo Kitchen this summer to open at least 100 ghost kitchen locations in the next year. 

Dive Insight:

Dickey's has grown over the past two years through digital sales, according to the press release, and the company hopes Franklin Junction will "accelerate [its] presence in untapped markets."

"Franklin Junction's offerings provide our brand with the ability to increase our revenue within our current operating systems while also bringing us to market quickly," Dickey's CEO Roland Dickey Jr. said in the release.

Franklin Junction, which owns the trademark to the term host kitchen, has worked with other major brands as well, including Nathan's Famous. The partnerships have helped these restaurants expand rapidly. The hot dog chain, for instance, linked up with the host kitchen platform in April 2020 and later Reef Technoloy, and by February had opened its 100th ghost kitchen. In April 2020, Franklin Junction said it had 550 host facilities on its platform and planned for another 1,000 by the end of that year. Other partners include Nathan's Famous' brand Arthur Treacher's, Frisch's Restaurants and Wing Depo, which signed on in December. 

Franklin Junction CEO Rishi Nigam said in the release that Dickey's strong brand reputation and its embrace of "the power of e-commerce" make it a good fit for Franklin Junction's business. In addition to its deal with Combo Kitchen, Dickey's launched two virtual brands, Wing Boss and Big Deal Burger, this year, seeing quick growth. The two brands increased the number of locations they operated out of by 24% in Q2, with monthly sales increasing 315% from March to June.

Using a host kitchen model is likely to only further fuel Dickey's expansion. Host kitchens can offer restaurant chains a lucrative second revenue stream as demand for off-premise dining options hold steady. These concepts give restaurants with excess kitchen and storage capacity an opportunity to expand sales by hosting other restaurant brands. Though these brands are usually restricted to off-premise and online orders, Ruby Tuesday serves food from its virtual brand Libby's BBQ in-store at its restaurants. 

For Nigam, the growth of host kitchens is only beginning. In a previous interview, he told Restaurant Dive, "I would say by 2025 greater than 50% of restaurants in this country will be selling multiple brands. By the end of the decade it'll be 90%."