Dive Brief:

• Chili’s has opened its first delivery/carryout-only (Delco) concept near Southern Methodist University in Dallas, the company wrote in an email to Restaurant Dive.
• The restaurant will offer a menu of Chili’s favorites, including Big Mouth Burgers, fajitas, Chicken Crispers and the Presidente Margarita. It will also offer virtual brand It’s Just Wings. 
• Chili’s off-premise business reached $1 billion annually and makes up one-third of company sales, Wade Allen, Brinker International SVP and chief digital officer, said in a statement.

Dive Insight:

Chili’s 1,600-square-foot format is designed to expand the brand’s reach into dense and untapped markets where diners prefer off-premise service. It will also allow the brand to open in areas that are too small for a traditional 5,500-square-foot restaurant. Chili’s plans to open a second Delco location in Columbus, Ohio, next year. These smaller units employ 20 people, compared to roughly 80 employees needed at a traditional unit, a company spokesperson said.

“We've structured our organization to be more deliberate about improving the off-premise experience end to end, removing friction for both guests and team members, and optimizing food quality for takeout and delivery,” Brinker CEO Kevin Hochman said Wednesday during Brinker’s Q1 2023 earnings call. “We believe this focus will accelerate the growth of this important part of our business.”

For Brinker, that optimization process includes rightsizing its virtual brand menus. The company is looking to cut its Maggiano’s virtual brand menu by roughly half, and trim one item from It’s Just Wings menu to remove food waste. The company has also been looking to improve capacity in the fry zone during dinner service, when demand is high for It’s Just Wings items.

Brinker has shifted its technology focus toward equipment that will reduce cook times. It’s looking for an improved kitchen display system to optimize order flow at the to-go area, as well as an improved mobile site to speed up checkout and secure repeat customers. 

While Chili’s rival Applebee’s is also exploring off-premise-only restaurants to increase off-premise business, QSR and fast casual concepts are leading the way in off-premise-only development. Chains including Jack in the Box, Chipotle, Panera and Sweetgreen have opened off-premise only units within the last 10 months.