The Raising Cane’s Phenomenon

Photo Credit: https://www.flickr.com/photos/dave77459/1000050348 License: https://creativecommons.org/licenses/by-nc-sa/2.0/

Not too far from our office, on 69 Hwy, there’s a billboard which has a picture of the rapper/actor Ice T on it, holding an iced tea from the restaurant Raising Cane’s. The tagline reads: “The official iced tea of Ice T.” It will elicit a chuckle from most people, whether or not they ever go into a Raising Cane’s restaurant. But that little piece of advertising points towards a culture and attitude that has made it one of the fastest-growing chains in America.

The Numbers

The company’s first location opened in 1996 in Baton Rouge a few steps from LSU and is known in the company as “the Mothership.” It was an instant hit and on its first day it stayed open until 3:30am. To this day the Mothership closes at 3:30am Thursday through Saturday.

Just under 30 years later, and the franchise is at nearly 900 locations. In the first half of this year, it did $2.3B in revenue, with same-store sales increasing more than 17% in that same period. Average unit volume? $6.2M, which is more than double the quick-service industry average.

The Concept

Founder Todd Graves (who still owns 90% of the chain) originally presented a business plan in college for a restaurant that served chicken finger meals and nothing else. His professor gave him the lowest grade in the class and told him it would never work. He wasn’t daunted and went to numerous bankers anyway. No one took him seriously. So he decided to save up his own dough.

He moved to California and worked 90-hour weeks as a boilermaker, then to Alaska, to work 20 hours a day fishing for sockeye salmon. With enough money in his pocket, he came back to Louisiana, took out an SBA loan, and after being dissuaded not to call it “Sockeye’s Chicken Fingers,” it became “Raising Cane’s,” after his dog.

While it is primarily a chicken finger restaurant (strange to even read that phrase out loud), it does also feature Texas Toast and a chicken sandwich. Fans of the restaurant will tell you about how good Cane’s sauce is (Google will tell you it’s probably mayo, ketchup, Worcestershire sauce, pepper, and garlic), and even more interesting, people are fans of the pebble ice that goes in the cold drinks (like the aforementioned iced tea).

Success

So what were the keys to success for Todd, and what we as business owners can take away from this story?

1. Mentorship: Todd was mentored by Andrew Cherng, co-founder of Panda Express. Todd was inspired by Cherng’s story and took to heart the importance of investing in employees, customer service, and quality real estate. Cherng also provided a model of growing methodically, not quickly.
2. Do One Thing Well: Let’s be fair to Todd’s professor: a chicken finger restaurant probably never really occurred to anyone as a recipe for success, and in the hands of less committed people, it might have failed. Todd focused on winning on the chicken fingers front and fans often call the fingers “crunchy on the outside, juicy on the inside.” He’s created a category of one.
3. Have fun: You won’t find boring decor inside the restaurants. From an Elvis picture near the soda fountain, to Texas sports memorabilia, to bright interiors and high ceilings, customers often find the interiors of the restaurants “comfortable.” The fun isn’t just aimed at customers. Employees are known as “Caniacs” and are known for friendly and enthusiastic attitudes. They are empowered to go above and beyond for customers, and that attitude is often reflected in reviews about the restaurants.

A friendly reminder: you don’t have to move to Alaska after getting turned down by a bunch of bankers, work 20-hour days, then save up and build a business from scratch. We can help you buy one from someone who already did all that. Give us a call today.