The installation of former McDonald's executive Ed Rensi as Famous Dave's CEO could lead to significant changes at the stagnant barbecue chain, particularly regarding its menu.
The company said Friday that Rensi, Famous Dave's temporary CEO since February, will get the job permanently. Famous Dave's also announced the appointment of a new chief financial officer, continuing the firm's management shake-up.
In an interview with the Star Tribune, Rensi said Famous Dave's — while it has "great food" — hasn't kept up with the times. "All restaurants need to evolve over time, all of the time," he said. "Famous Dave's is 20 years old this month but really hasn't evolved that much. Dave's needs to evolve the menu."
That doesn't mean Famous Dave's is going to abandon the classics, like a slab of ribs or chunk of brisket. But Rensi says Dave's meats need to be more than "center of the plate" attractions. There should be more menu items that feature barbecued meats as ingredients — burritos or flatbreads, for instance.
And Famous Dave's also needs a better "smaller plate strategy," offering smaller portions at lower price points, Rensi said.
Rensi, 69, was named interim CEO when John Gilbert abruptly resigned after only 16 months on the job. About a month later, Chief Operating Officer Christopher O'Donnell, who had been CEO before Gilbert, left the Minnetonka-based company.
Investors have been paying a lot more attention since Rensi became interim CEO. The company's stock has almost doubled, closing Friday at $31.76, up 10 cents. "I think people like Ed, because fundamentally, there hasn't been much change in the business," said Mark Smith, an analyst at Feltl and Co.
Sales have been in a holding pattern for the past few years, while Smith said the chain's profitability has been rather mediocre. The company, which has 193 restaurants in more than 30 states, must reignite growth.
Rensi made his name at fast-food giant McDonald's, starting in 1965 as a "grill man" for 85 cents an hour and leaving in 1999 after several years as head of North American operations. He later founded Tom & Eddie's, a small restaurant chain in suburban Chicago.
Rensi, who joined the Famous Dave's board in January, said newer menu strategies are being rolled out at an outlet in the Chicago suburb of Bolingbrook. The restaurant has more beer offerings than a typical Famous Dave's, and also has about 20 televisions, which are tuned to sports, news and food shows.
"People eat out for entertainment," Rensi said. "Look at Buffalo Wild Wings, it's all about entertainment."
Golden Valley-based Wild Wings has become a restaurant industry juggernaut, and its sports bar atmosphere has been a key driver of its growth.
Famous Dave's also said Friday that Richard Pawlowski will become its new chief financial officer on June 2. Pawlowski has experience in acquisition and turnaround strategies, particularly with regard to restaurant companies, Dave's said in a statement. He was most recently CEO and co-founder of Capitol C Holdings.
Diana Purcel, Famous Dave's current CFO — who's been in that position since 2003 — will be leaving the company "to pursue other opportunities," the statement said. She will remain through July 1 for "transition purposes."
Famous Dave's also said Friday that two board members had resigned effective Wednesday. Richard Monfort and Lisa Kro, who have served on the Famous Dave's board of directors since 1996 and 2009, respectively, are being replaced by Jonathan Lennon and Brett D. Heffes.
Heffes is president of Winmark Corp., a franchiser of value-oriented retail concepts and a technology leasing company. Lennon is the founder and portfolio manager of Pleasant Lake Partners, which is Famous Dave's largest shareholder with a 12.8 percent stake.
Pleasant Lake is one of three potential activist shareholders that have been building significant stakes in Famous Dave's over the past 18 months.