- Taylor Gourmet, the Washington, D.C.-based hoagie chain that closed all but one of its locations in September, is now in the middle of an intellectual property bidding war. According to the Washington Business Journal, Taylor founder Casey Patten, sandwich chain Cosi and a company called Source Cuisine have filed bids for the restaurant’s trademark and email list as it continues its bankruptcy proceedings.
- Patten bid $35,000 for several trademarks linked to the Taylor Brand and its customer email list, with Source Cuisine bidding $38,500 and Cosi bidding $50,000.
- The bidding period ended Dec. 14, and no other bids have been filed.
A number of factors have been attributed for Taylor Gourmet’s abrupt closure in September, including too-fast expansion, high real estate costs and stiff competition. Sales also took a sharp turn south after co-founder Casey Patten met with President Donald Trump in 2017 and never fully recovered. The Washingtonian reported that sales dropped 40% the day after the news broke about the meeting.
KarpReilly’s retraction of its $5.6 million in funding — initially given to Taylor Gourmet in 2015 to spur rapid expansion in D.C. and Chicago — was the likely nail in the coffin. Still, according to Restaurant Business, the full closure of the brand is somewhat unusual as buyers typically step in to drive a turnaround. As the publication notes, any buyer of Taylor Gourmet would have to start all over again.
Right now, rival sandwich chain Cosi is the highest bidder. The company could be angling for an intellectual property purchase to keep a competitor out of the market — a savvy move for $50,000, particularly for a brand less than two years out of its own bankruptcy. If Cosi secures the bid and doesn’t use the trademark, Taylor Gourmet will simply become a zombie trademark in which the name will be considered abandoned — not uncommon for competitive purposes. Perhaps more importantly, Cosi’s bid would also include Taylor Gourmet’s email list, a valuable asset for Cosi, which could leverage such a list to woo new customers.
More intriguing is the potential for Patten himself to get the trademark bid. Would he be willing to start all over again without a private equity backing? It would be a massive undertaking, considering Taylor Gourmet has rejected its outstanding leases and abandoned its equipment, according to the Washington Business Journal.
But the brand itself has plenty of equity on its own and was recently considered a local favorite in the D.C. area. Technomic data shows that Taylor Gourmet’s sales grew more than 40% in 2017, while average unit volumes grew 3%, Restaurant Business reports.
If it is back to the drawing board for Taylor Gourmet, the company would be wise to steer clear of a too-fast-too-soon expansion strategy that some fans argue compromised the food’s quality. Taylor still has one unit remaining in Reagan National Airport owned by Concessions International, and a court ruling awaits on an objection over the sale of the trademark by that operator. In the meantime, Taylor Gourmet — interestingly — continues to engage with fans on its Twitter account, leading some of the brand's followers to believe that a comeback is, indeed, imminent.