Cracker Barrel Old Country Store

This article is about the restaurant-and-store chain. For the Kraft Foods brand, see Kraft Foods.

Cracker Barrel Old Country Store, Inc.

Type	Public
Traded as	NASDAQ: CBRL
Industry	Restaurants
Founded	September 19, 1969
Founder(s)	Dan W. Evins
Headquarters	Lebanon, Tennessee, U.S.
Number of locations	~600[1]
Area served	United States
Key people	Michael A. Woodhouse (Director & Executive Chairman of the Board) Sandra B. Cochran (President & CEO)[2]
Revenue	US$ $2.434 Billion (2011) [3]
Operating income	US $167.18 Million (2011)[3]
Net income	US $85.21 Million (2011)[3]
Total assets	US $245.92 Million (2011) [4]
Total equity	US $268.03 Million (2011)[4]
Employees	65,000+
Website	crackerbarrel.com

Cracker Barrel Old Country Store, Inc. is an American chain of combined restaurant and gift stores with a Southern country theme. The company was founded by Dan Evins in 1969 and its first store was located in Lebanon, Tennessee, where the company is now headquartered. The restaurant menu is based on traditional Southern cuisine and each store's decor is designed to resemble an old fashioned general store. Cracker Barrel's stores were traditionally located near highway exits in the Southeastern and Midwestern U.S., but expanded across the country during the 1990s and through the 2000s. As of 2011^[update], the chain operates over 600 stores in 42 states.

Restaurants

Food and gift shop

A typical Cracker Barrel gift shop

Cracker Barrel Old Country Store is a Southern themed chain of restaurants and retail stores that serves traditional Southern comfort food often described as "down-home" country cooking, and sells gift items including toys and woodcrafts.^[5][6][7][8] Breakfast is served all day, and there are two separate menus: one for breakfast, the other for lunch and dinner. Since the first restaurant opened, the menu has featured Southern specialties, including biscuits, fried chicken and catfish;^[6] seasonal and regional menu items were added during the 1980s and 1990s.^[6][9] Particular specialties include made from scratch biscuits, fried apples, hash brown casserole^[10] and a breakfast platter named "Uncle Herschel's Favorite" after the uncle of the chain's founder.^[11] In addition to traditional Southern dishes, the Cracker Barrel menus also include more contemporary options, such as a yogurt and fruit parfait on the breakfast menu.^[12] Menu items are the same in all restaurants, and the chain aims to ensure that the food quality and portion sizes are consistent at each location.^[11][12]

The retail area of each Cracker Barrel Old Country Store offers various gift items for sale, including toys, woodcrafts, and traditional foods such as jellies.^[6] The store also sells items that are on display as part of the location's décor including wooden rocking chairs^[8] and Lodge cast iron products.^[13]

Locations and service

For much of its early history, the chain chose to locate its restaurants along the Interstate Highway System,^[6] and the majority of its restaurants remain close to interstate and other highways.^[14][15] As of 2011^[update], Cracker Barrel had opened over 600 restaurants across 42 states.^[12][16][17] All store locations are open seven days a week for breakfast, lunch and dinner.^[6]

Cracker Barrel's mission statement is "Pleasing People",^[18] and also states that "everyone who walks in our front door gets a warm welcome and a good meal at a fair price".^[19] In keeping with its Southern theme, service in the restaurants is intended to be informal and friendly.^[20][8][21]

Decor

A typical Cracker Barrel in Morrisville, North Carolina

Cracker Barrel Old Country Store locations are themed around the idea of a traditional Southern U.S. general store. Items used to decorate each store are authentic artifacts,^[22] including everyday objects from the early 1900s and after.^[23] Each restaurant features a front porch lined with wooden rocking chairs, a wooden peg solitaire game^[24] on every table—provided for customers' use while they wait for a table or for their food to arrive^[20]—and a stone fireplace with a deer head displayed above the mantel.^[11] The peg games have been present in Cracker Barrel stores since the opening of the first store, and continue to be produced by the same family in Lebanon, Tennessee.^[25] In addition to the items that are present in all Cracker Barrel locations, the decor of each store typically includes artifacts related to the local history of the area.^[15] The chain has a warehouse in Tennessee for collecting artifacts from across the U.S., where it catalogs and stores them for future decorating use.^[26] For each location, a team led by Cracker Barrel's decor manager, Larry Singleton, designs the store's layout of artifacts including vintage posters, signage and items such as farm implements. The theme of each restaurant is tailored to the local history and environment, designed at the warehouse and shipped to the new store to be assembled.^[23]

Reception

Cracker Barrel is known to have "extremely loyal" customers,^[27][9] some of whom have regularly eaten at the restaurant for decades. In 2009, an article in The Tennessean on the chain's 40th anniversary reported that a group of friends had eaten breakfast at the Lebanon location each Tuesday for over 20 years.^[11] Some customers know the menu by heart^[23] and travel across the country to visit different Cracker Barrel locations.^[9] Cracker Barrel has celebrity fans who are not officially affiliated with the restaurant but have mentioned the chain in interviews and profiles. Among these are Selena Gomez,^[28][29] Kellie Pickler,^[30] and Taylor Swift (who has stated that Cracker Barrel's breakfast is her favorite food).^[31]

Cracker Barrel has received awards for its food and customer service.^[32] In particular, the restaurant chain was named the "Best Family Dining" restaurant by a nationwide "Choice in Chains" consumer poll in Restaurants & Institutions magazine for 19 consecutive years, prior to the magazine ceasing publication.^[11] In 2011, Cracker Barrel was voted the top family dining restaurant in a new poll begun by trade publication Nation's Restaurant News.^[33]

Destinations magazine has presented Cracker Barrel with awards for best chain restaurant,^[34] and in 2010 and 2011 the Zagat survey named Cracker Barrel the "Best Breakfast".^[35][36] Cracker Barrel has also received awards for other aspects of its business, including being selected by the Outdoor Advertising Association of America as the 2011 OBIE Hall of Fame Award recipient for its long-standing use of outdoor advertising.^[37]

History

First location and early growth

Cracker Barrel Old Country Store was founded in 1969 by Dan Evins, a sales representative for Shell Oil, who developed the restaurant and gift store concept initially as a plan to improve gasoline sales.^[6] Designed like the traditional country store Evins remembered from his childhood, with a name chosen to give it a Southern country theme,^[18] Cracker Barrel was intended to attract the interest of highway travelers.^[6] The first restaurant was built close to Interstate 40, on a piece of land owned by Evins in Lebanon, Tennessee.^[22] The restaurant opened in September 1969,^[5] serving Southern cuisine including biscuits, grits, country ham and turnip greens at affordable prices.^[22]

Evins incorporated Cracker Barrel Old Country Store in February 1970,^[6] and more locations soon followed. In the early 1970s, Evins leased land on gasoline station sites near interstate highways to build more Cracker Barrel restaurants.^[18] These early locations all featured gas pumps on-site, however Cracker Barrel began to build restaurants without pumps during gasoline shortages in the mid to late 1970s.^[6] From the late 1970s through the early 1980s, the company significantly reduced the number of gas stations on-site, eventually phasing them out altogether, as the company focused on its increasing restaurant and gift sales revenues. However, the restaurants continued to be located near highway exits, and their main customer base remained interstate travelers.^[5] Cracker Barrel became a publicly traded company in 1981 in order to raise funds for further expansion of the chain.^[6][22] It floated over half a million shares, raising $4.6 million.^[18] Following the initial public offering, Cracker Barrel grew at a rate of around 20% per year,^[21] and by 1987 the company had become a chain of over 50 units in eight states, with annual net sales of almost $81 million.^[6]

New markets

Cracker Barrel's consistent growth in the 1980s and 1990s was noted by industry journals and Forbes magazine, particularly for its $1 billion market value.^[22][27][38] By 1993 the chain's revenue was nearly twice that of any other family restaurant.^[18] To build on this success, in 1994, Cracker Barrel tested a carry-out only store, Cracker Barrel Old Country Store Corner Market, aiming to expand into suburban residential locations. The first Corner Market location offered many of the same dishes as Cracker Barrel's traditional stores, however all food was prepared for take-out instead of sit-down dining.^[38][27] Cracker Barrel ultimately decided not to pursue this "home-meal replacement" concept; the then-president of Cracker Barrel stated that it created confusion for the chain's customers who had expected the same service and atmosphere from the Corner Market stores as from its traditional stores.^[21]

In addition to the Corner Market stores, in the 1990s, Cracker Barrel expanded into new markets through the establishment of more traditional Cracker Barrel locations, the majority of them outside the South. The chain also tested alterations to its menus to adapt to new regions.^[9] Cracker Barrel added regional dishes to its menus, including eggs and salsa in Texas and Reuben sandwiches in New York, but continued to offer its most popular menu items, including country fried steak and roast beef, in all restaurants.^[27]

Refocus

By September 1997, Cracker Barrel had 314 restaurants and was continuing to grow, aiming to increase the number of stores by approximately 50 per year in the following five years, according to The Wall Street Journal.^[9] Cracker Barrel closed its Corner Market operations in 1997, and refocused on its restaurant and gift store locations. Its president at the time stated that the chain was focusing on strengthening its core theme, offering traditional foods and retail in a country store setting, with good service and country music.^[21] In 1998, Cracker Barrel opened its first restaurant and gift store not located near to a highway, in Dothan, Alabama.^[39] The company celebrated its 30th anniversary in 1999, and, to commemorate the event, it launched a series of community-focused activities including a nationwide book drive and a sweepstakes, with trips to the Country Music Association Awards and rocking chairs among the prizes.^[40]

Innovation and later growth

The number of combined restaurants and stores owned by Cracker Barrel approximately doubled between 1997 and 2000, to over 420 locations. In 2000 and 2001, the company addressed staffing and infrastructure issues related to this rapid growth by implementing a more rigorous recruitment strategy and introducing new technology, including an order-placement system.^[41] From the late 1990s to the mid-2000s, the company focused on opening new locations in residential areas, where it would be able to gain customers from local residents and workers.^[39] In 2006, it updated its marketing, also to encourage new customers, changing the design of its highway billboard advertisements to include images of menu items, including pancakes, biscuits and sweet corn, as well as the company's logo.^[42] Following the economic downturn in 2008 and 2009, Cracker Barrel continued to grow and perform well. Its then-chief executive officer, Michael A. Woodhouse, stated in an interview with The Tennessean that the company aimed to provide consistent value for its customers, which was reflected in its continued success.^[43] Cracker Barrel celebrated its 40th anniversary in 2009,^[11] and by 2011 had opened over 600 restaurants in 42 states.^[44] In September 2011, Cracker Barrel announced that its revenue for the 2011 fiscal year was $2.43 billion.^[45]

Corporate overview

Business model

Cracker Barrel Old Country Store is a chain of wholly owned locations offering sit-down dining and retail.^[21] The restaurant is aimed at the family and casual dining market and also markets itself to people traveling on the interstate highways, as the majority of its locations are close to highway exits.^[38] The Cracker Barrel stores are designed and marketed around a country theme, offering traditional Southern cuisine in stores designed to evoke a rustic, country ambiance through their decor and background country music.^[21]

According to industry commentators Cracker Barrel has been consistent in its sales performance,^[38] and it has been well regarded by financial analysts, particularly for its cost controls and measured growth.^[43] Cracker Barrel's brand includes a focus on customer service and the company has stated it aims to keep employee turnover low, in order to provide better trained staff.^[43] Since the 1980s, Cracker Barrel has offered a formal training program with benefits for progressing through it to all of its employees.^[6][46]

Partnership and sponsorship

Cracker Barrel sponsored the NASCAR Atlanta 500 Cup from 1999 to 2001^[47] and the Grand Ole Opry from 2004 to 2009. The company was the first presenting sponsor of the Grand Ole Opry.^[48] This sponsorship led to the company gaining connections within the Nashville music industry, following which it entered into partnership with a number of country music artists.^[49] The chain has established partnerships with artists including Alison Krauss, Charlie Daniels, Josh Turner, Kenny Rogers, Dolly Parton, Alan Jackson and Alabama, to offer CD releases and merchandise that are only sold at Cracker Barrel.^[50][49][51]

Diversity and discrimination claims

Policy toward sexual orientation

In 1991, an intra-company memo called for employees to be dismissed if they did not display "normal heterosexual values".^[9][18] The company stopped its implementation shortly after being introduced and stated it would not discriminate based on sexual orientation,^[52] after demonstrations by gay rights groups.^[53] Later, the company's founder, Dan Evins, stated that the policy had been a mistake.^[18] Following proposals by the New York City Employees Retirement System, a major shareholder at the time, in 2002 the company's shareholders voted 58% in favor of adding sexual orientation to the company's nondiscrimination policy.^[54][52]

Alleged racial discrimination

In July 1999, a discrimination lawsuit was filed against Cracker Barrel by a group of former employees, who claimed that the company had discriminated against them on the grounds of race.^[55][17] Two years later, in December 2001, the same attorneys filed a separate lawsuit representing 21 customers of the restaurant, alleging racial discrimination in its treatment of guests.^[56][57][58] Regarding both the 1999 and 2001 accusations, Cracker Barrel officials disputed the claims and stated that the company was committed to fair treatment of its employees and customers.^[57][59][17] In 2004, Cracker Barrel signed a five year agreement with the U.S. Justice Department to introduce "effective nondiscrimination policies and procedures" including: new equal opportunity training; creating a new system to log, investigate and resolve complaints of discrimination; and publicizing its non-discrimination policies.^[60] It also paid a $2 million settlement to end a suit alleging race and sexual harassment at three Illinois restaurants, in 2006.^[61][62] Following the suits, Cracker Barrel stores began displaying a sign in their front foyer explaining its non-discrimination policy,^[63] and also added the policy and details of how to make a complaint to its menu and website.^[64]

Diversity

In addition to Cracker Barrel's equal opportunity policies, the company has focused on improving the company's diversity through training and providing resources to minority employees. As of 2002^[update], 23% of Cracker Barrel's employees were minorities, including over 11% of its management and executives.^[65] In the early 2000s, the company began outreach to minority employees, including offering a training plan to help employees whose first language is Spanish to learn English.^[66] Cracker Barrel is on the Corporate Advisory Board for the Texas Conference of the National Association for the Advancement of Colored People (NAACP),^[67] and is a corporate sponsor of the NAACP Leadership 500 Summit, where three of its officials were moderators and panelists in May 2011.^[68] The company has been praised for its gender diversity, particularly on its board of directors, which includes three women out of eleven total board members. Its chief executive officer, Sandra Cochran, is the second woman in Tennessee to hold that office in a publicly traded company, as of August 2011^[update].^[69]

Cracker Barrel has been listed in the Human Rights Campaign's (HRC) Corporate Equality Index, which ranks companies by comparison of their non-discrimination policies and actions towards lesbian, gay, bisexual and transgender employees and customers.^[70][71] In the 2011 survey, HRC noted that Cracker Barrel had established a non-discrimination policy and had introduced diversity training that included training related to sexual orientation.^[70]

Community involvement

Cracker Barrel has supported a wide range of charities, through one-off donations, promotional events and partnerships with charitable organizations.^[72][73] The chain has supported local charities and causes in communities where its restaurants are located, including donating over $1 million of meals to hurricane evacuees and volunteers in the Gulf Coast following Hurricane Katrina in 2005.^[74] Following severe flooding in Nashville in 2010, Cracker Barrel made a donation to a charity involved in relief efforts and also established Cracker Barrel Cares Inc., a non-profit organization aimed at providing support to Cracker Barrel employees, funded by the chain's employees.^[75] Cracker Barrel has also formed partnerships with charities, such as its sponsorship of the Wounded Warrior Project, a non-profit organization working with injured veterans.^[76]

In addition to its work with charitable organizations, Cracker Barrel has partnered with organizations to provide community programs and scholarships, including providing a scholarship through the National Black MBA Association,^[65] and job skills programs with 100 Black Men of America^[77] and the Restaurant and Lodging Association.^[78] The company has also provided sponsorship to groups including 100 Black Men of America.^[66]

References

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External links

Cracker Barrel Old Country Store website