Newly minted Punch Bowl Social CEO John Haywood is no stranger to challenging restaurant segments. Prior to joining the Denver-based eatertainment concept — which traded at $185 million in 2019 before the novel coronavirus pandemic pushed it to the brink of foreclosure and scared off primary investor Cracker Barrel — Haywood served as the CEO of Garden Fresh Restaurants.
Haywood revamped Garden Fresh, parent company of buffet chains Souplantation and Sweet Tomatoes, with new restaurant designs that increased customer traffic and even poised the company for store expansion. Like Punch Bowl Social, Garden Fresh's 97 units had a strong fan base, with two million loyalty members at one time. The company was ultimately forced to filed Chapter 7 bankruptcy in May after shuttering its restaurants in compliance with FDA recommendations to close salad bars and buffets, during which time it lost more than $1 million per week.
But Haywood is confident that diner demand for social experience will hold steady through the pandemic, and that Punch Bowl Social's large footprints will allow the chain to safely cater socially distanced dining and games.
"Like all concepts, we have to have some interim tactics through the next 12 months," Haywood said. "But as areas reopen, we have a real advantage. We have very large and flexible facilities... And we think we can create some unique environments [because] very few places have the type of space that we do."
The chain's Denver location, for example, has converted its sizable green space outside of the building into a socially distanced eating area with a sea of picnic tables, Haywood said. He added that Punch Bowl Social will customize its offerings by market, depending on the intensity of COVID-19 in each area. Currently, its Denver, Cleveland and Atlanta locations are open and the chain plans to open a fourth at the end of the month. By September, the majority of Punch Bowl's 16 stores are slated to reopen, Haywood said.
For now, the plans made under founder and former CEO Robert Thompson — who exited the chain last week— to expand into the hospitality space and potentially open a hotel by 2022 are on hold, Haywood said. Instead, he will focus the company on reopening existing locations and begin looking at continued expansion in the spring with the help of lender CrowdOut Capital.
“We wish Robert well in his future endeavors and thank him for his years of tireless work,” Alexander Schoenbaum, CrowdOut Capital’s CEO and Punch Bowl Social’s senior lender, said in a company release. “He created an incredible brand in Punch Bowl Social. CrowdOut remains committed to the goal of helping the brand stay at the forefront of the eatertainment movement and will continue to support Punch Bowl Social, as we have throughout the global pandemic and the ongoing reopening of locations.”
Haywood believes Punch Bowl Social's innovative offerings, which attracted him to lead the company through the current economic crisis, are still timely and said he is confident the concept has a "great future" ahead.
"Punch Bowl Social [was] extremely successful pre-COVID, so there's nothing broken with the brand. We had industry-leading average-unit sales pre-COVID, so we face the same challenges that the entire industry does. But we need to get through what will likely be another tough 12 months and accommodate our guests both in terms of providing a safe environment and providing as much experience as we can," Haywood said. "The brand has been through a lot of rapid growth. So we will take this opportunity to pause, and to listen to our guests and listen to our very passionate team members [about] ways that we can enhance our experience."