Slow, steady growth paying off for Darden
Like the tortoise in Aesop’s fable, Orlando-based Darden Restaurants for several years has taken a slow, steady approach to opening new Olive Gardens and Red Lobsters as its competitors built at the frenzied pace of the hare.
But as the recession slowed growth at other chains, Darden began overtaking its competitors. And as the company moves forward building in restaurants – about 50 this year, increasing to between 65 and 75 in 2011 – it stands to do well in a tough real-estate market by snapping up good locations at great prices.
Through a spokesman, Darden executives declined to be interviewed about future plans. But industry watchers say the Fortune 500 company with annual sales of $7.2 billion will benefit from its measured approach.
“The big, well-positioned players like Darden that are very disciplined in their growth are going to find a lot of opportunities at the expense of people who don’t have the same financial strength,” said Rick Van Warner, a former company spokesman who now is president of a consulting firm.
Darden has been growing its restaurants at a rate of between 3 percent and 4 percent. A few years ago, it was lagging behind many other major chains, which were “far outstripping the growth of consumer spending and even the growth of population,” said Steve West, a restaurant-industry analyst for the investment firm Stifel Nicolaus.
Like this post? Subscribe to my RSS feed and get loads more!
Leave a Reply