Koo Koo Roo, part 2: new menu, casual look; converts stores to California Kitchen concept, broadens marinated char-broiled chicken base

Nation's Restaurant News, March 8, 1993 by Peter O. Keegan

Converts stores to California Kitchen concept, broadens marinated char-broiled chicken base

ISELIN, N.J. -- Realizing substantial traffic increases from conversions to its Koo Koo Roo California Kitchen concept, the 10-unit chicken chain is getting its hen house in order and sales back on track.

Originally a concept based around charbroiled skinless chicken marinated in vegetable juices, the company has expanded its menu for broader appeal -- after realizing the 4-year-old concept sent conflicting messages with its sophisticated menu and fast-food type atmosphere.

Last July the company began converting units to the California Kitchen concept, changing its moniker and adding charbroiled barbecued chicken, rotisserie chicken and an expanded menu of chicken sandwiches, pastas and healthful side dishes to its signature charbroiled product.

"I think we broadened our customer appeal from the strictly good-for-you, body-building, health-conscious consumer to food that tastes great and is good for you," said Michael D. Mooslin, Koo Koo Roo Inc. president. "It hits the stomach first and the mind second."

Koo Koo Roo has stores in California, Nevada, New York, New Jersey and Florida, and most of the company stores have been converted, with one or two franchise stores undecided about whether to spend the money for the new menu and look.

In addition to the new menu, the atmosphere at the converted stores has been softened with the addition of blonde maple wood tables and chairs that are movable -- replacing the "fast foody" booths, glass, formica and fast-food menu board.

The natural wood finishes are even being carried to the storefront for a more natural look.

"We have far exceeded our goals, increasing sales between 60 and 100 percent," Mooslin explained. "The menu is broader, and the look of the place is more conducive to family dining."

Mooslin noted that converted units around the country are averaging between $600,000 and $700,000 in sales per store on "b" sites, with company-owned stores doing better than franchised units.

"From now on we're going after "a" sites," said Mooslin, explaining that better sites may increase sales even more.

"Landlords are very excited about the concept and coming up with good landlord contributions," explained Mooslin, adding that the company is targeting two or three new stores this year.

A new prototype, which will be unveiled shortly in Marina Del Ray, Calif., takes the concept a step further -- opening up the atmosphere with an even more casual look.

"The new concept also puts the food on display, adding more showmanship," Mooslin explained. "It's very inviting, people come to relax but it doesn't discourage takeout business."

The menu includes charbroiled chicken sandwiches in original, Mexican, Chinese, Italian and barbecue flavors, and fresh salads include Chinese chicken salad, chicken Caesar salad, pesto pasta salad, Santa Fe Pasta salad and a fresh fruit salad.

Side dishes include warm pinto beans, chicken chili, chicken soup, crisp cucumber salad, chilled lentil salad and cracked wheat rice.

New additions to the Koo Koo Roo menu include apple sauce, sweet potato puree, confetti rice, fresh steamed vegetables and mushroom barley soup.

Mooslin said food costs range between 30 percent to 32 percent, with eat-in and take-out sales evenly split. Per-person ticket averages have gone up since the conversions, to $5 for lunch and between $6 and $7 for dinner, he said.

At the new converted stores, Mooslin said, the original marinated skinless product accounts for 50 percent of sales, while 30 percent is rotisserie and 20 percent is skinless barbecue.

In the past two years, Koo Koo Roo has weathered a public offering, troubled sales, a management shakeup and problems with finding a president.

In early 1992 Koo Koo Roo hired former Blockbuster executive Vincent Lambiase, whom they sued for reneging on the deal, after founders Mike and Ray Badalin sold the majority of their stake in the company and resigned as board members and officers to become licensees.

Soon after, the new board appointed Mooslin, owner of a management firm specializing in franchising and former president of the Naugles Mexican fast-food chain.

Mooslin said the company is reducing general and administrative costs. "We're finding that the company is no longer burdened by legal expenses or costs from the public offering," Mooslin commented. "We also have stronger managers, with less expensive field supervision."

"We're looking for an executive chef who will be a buyer," Mooslin said.

He wants the chef to supervise purchasing, refine recipes and monitor new menu items on a store-by-store basis.

As the chain grows, the chef will also be responsible for operations of a soon-to-be-constructed commissary, Mooslin added.

The chain halted franchising for the past nine months because it was busy revamping units and carefully watching the results, and it recently lowered its franchising rates to attract more franchisees.

"During the time of refinement of the concept, we wanted to get it nailed down before we proceeded with franchising," Mooslin explained.