Oliveto prepared to gain ground

March 29, 2010
Last week, Tulsa-based Mazzio's LLC announced it had signed a franchise partnership with Fransmart development company to help expand Mazzio's and its fast casual Oliveto Italian Bistro. But the company release failed to focus on the real news – the explosive potential of lesser-sung concept, Oliveto, and its perfect positioning for consumers with strapped pocketbooks, nutritional awareness, and increasing food savvy. 
Oliveto only has one company-owned and one franchise location to parent company Mazzio's 172 so far, but Mazzio's CEO Gregory R. Lippert, formerly of Seven-Up Co. and Fazoli's, said he saw the signs of today's casual dining slowdown while planning the not-quite fast casual concept. 
The chain's conception started roughly five years ago (and first opened in Tulsa in 2008). By that time, Lippert said, it was apparent that casual dining was in "remission." Two of the biggest problems were that people didn't want to spend as much to eat out, and they were wary of the huge portions.  
"As we saw fast casual start to grow, we thought the sweet spot would be in between fast casual and casual dining," he said. "So $11, maybe $12 dollars is our check average. That's right in between."
That very specific price point spilled over to the wine program as well, which has also proven successful for Oliveto. Lippert said craft beer and wines comprise about 19 percent of sales. The key to his wine program's success is to keeping the price between $5.50 and $7 – not more expensive than an entrée. Successful beer and wine programs also require knowledgeable servers that feel comfortable describing a bottle's attributes, Lippert said.    
"The drinker now is much more astute," he said. "They expect the red wine to be chilled now versus room temp, and to be surprised with different flavors as well as the value. They want a bottle that tastes like $40 but sells for $20."
Lippert said he relies on his wine purveyors to help identify the hottest new selections that fit that description every few months.
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He commonly takes advantage of his vendors' R&D departments, including the culinary team on hand for his Wood Stone artisan pizza oven. They strive to come up with healthy entrees that are simultaneously current and satisfying, fulfilling the reputation of Italian food in America. The fresh salmon on a cedar plank is one such example: The Omega 3 fatty acids in the dish both elevate its flavor and offer various health benefits. Moderate portions also play into the health orientation, but also may have to do with watching close margins: "We don't want people splitting entrees," Lippert said.
Since teaming with Fransmart, the next steps are to identify potential franchisees, identify markets and locations and fine-tune price points for national rollouts that might happen in 2011. 
"We're not making any huge decisions today," he said, "but will within a year. Hopefully the economy is improved (by then) and the concept pricing will match expectation."

Topics: Business Strategy and Profitability

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