Dive Brief:

• Perkins has launched a bakery-only virtual kitchen concept, called Bakery by Perkins, after about five months of testing. The menu includes signature offerings from Perkins, like pies, cookies, Mammoth Muffins, brownies and cinnamon rolls, as well as an expanded lineup of new cakes and desserts, according to an announcement emailed to Restaurant Dive.
• The menu is available via delivery, carryout and curbside pickup on the DoorDash and Uber Eats app. The concept will be available in 85 corporate markets by the end of August and will be fully deployed by the holiday season, a high-volume time for Perkins' bakery items. The first franchised store is expected to launch the virtual brand in early September.
• The launch comes two years after Perkins declared bankruptcy and was subsequently sold to Huddle House. The pandemic landed another punch, with sales both in the breakfast category and in the full-service dining segment taking major hits.

Dive Insight:

Despite the challenges of the pandemic, Perkins has experienced growth in its off-premise channels in the past year and a half, Perkins Vice President of Marketing Joe Artime said in an email to Restaurant Dive. Bakery by Perkins is an extension of that business, and is designed to make Perkins' menu accessible to guests however they choose to order whether that be through the website, delivery app or phone. 

"Each of these methods bring incremental orders and we want to make sure we are delivering a flawless ordering experience on each of these platforms," Artime said.

The launch of Bakery by Perkins could also expedite the chain's recovery. In the release, the company said the test yielded incremental sales and profit to each store, as well as a "strong average check." The 17 test locations, which were in Florida and Minnesota, saw bakery category sales increase 10% to 20% in their restaurants.

Several restaurant chains have generated significant incremental income by adding virtual brands. Denny's virtual brand The Burger Den brought in net average weekly sales of $900 per unit, exceeding the company's success criteria by $250 a week. Bloomin' Brands expects its virtual Tender Shack brand to generate $75 million in annual sales, while Brinker's It's Just Wings exceeded the company's expectation of generating $150 million in annualized sales by $20 million in its first year.

Perkins may have plenty of additional growth opportunity here as well. QSR Magazine's top emerging virtual brands, for example, includes plenty of burger, wings, pizza and chicken concepts but just one bakery concept — Mariah's Cookies (by singer Mariah Carey). By launching ahead of its busy holiday season, Bakery by Perkins could generate significant trial.

Artime said the virtual concept will be focused intently on that bakery piece.

"We have a successful off-premise business, built through online ordering, traditional carryout/to-go and [third-party] delivery. However, the primary focus on these channels is our wide-ranging core menu of breakfast, lunch and dinner entrees, in addition to our Bakery treats. The goal in creating Bakery by Perkins was to create a virtual storefront specifically for guests that are seeking out whole pies, desserts, pastries and other items we sell in our bakery," he said. "This will also help us increase velocity on new Bakery extensions or products we test in the future."

Perkins restaurants that have added the virtual concept have not had to make any back-of-house or point-of-sale adaptations, either, he said.

"Because these are items that our teams are used to prepping and serving, the muscle memory on the incremental orders is already there," Artime said.