Dave's Hot Chicken eyes growth, undeterred by competitors Chick-fil-A & Raising Cane's

Dave's Hot Chicken Co-Founder Arman Oganesyan said his pop-up tent turned national food chain is focused entirely on its food and its customers, allowing it to stand out among its mega competitors.

"You always have your big chicken competitors like the Chick-fil-A's and the Raising Cane's, but [again] we like to focus on our food. We like to focus on our customer," he said to Yahoo Finance Live.

Its menu includes 4 combo meals that feature chicken tenders or chicken sandwiches, and include fries, pickles, and "Dave's Sauce." Spice options range from no spice to its hottest option, the "reaper." Other side offerings include Cheese Fries or Mac and Cheese, plus drinks (including milkshakes).

Oganesyan said its chicken-only menu allows the chain to maintain quality.

"The reason we do tenders only is ... so we can maintain a high quality food, while still having a high output level," he said, taking a little dig at competitors. "That way, we can kind of prep it and cook it as it's ordered...not keep it under heat lamps and not have it be pre-made and that way, everybody's getting a fresh order as they come in."

LOS ANGELES, CALIFORNIA - APRIL 22: People wearing masks stand outside
People wearing masks stand outside "Dave's Hot Chicken" near Melrose Avenue amid the coronavirus pandemic on April 22, 2021 in Los Angeles, California. (Photo by Alexi Rosenfeld/Getty Images)

He said that simple strategy is what keeps customers satisfied and craving more. From 2021 to 2022, Dave's Hot Chicken saw sales grow 155%, from $79.6 million to $203 million, and grew from 40 to 102 locations.

It plans grow at a pace of 100-120 stores "in the next year or so," CEO Bill Phelps said. The company has a goal of of 700 locations in North America, in major cities such as San Diego, Chicago, Houston, Detroit, Portland, Milwaukee, and Toronto.

Phelps said he took this mega growth strategy from his previous tenure as CEO of Wetzel's Pretzels and a co-investor in Blaze Pizza.

"Rick Wetzel and I knew nothing about franchising...but we learned the business from the franchisees and then Rick and Elise Wetzel came up with Blaze Pizza. I co-invested with them, and they did everything right. They brought in a great team and they were able to grow really quickly...that was the fastest growing restaurant chain and then we took their playbook, and we did that here."

Phelps said social media helped, calling it "the most efficient marketing tool kind of ever invented."

"The social media platforms of Instagram and TikTok give new brands like ours an ability to get incredible reach at very little cost ... You have guests walking into restaurants and filming the restaurant and the product, and that's what's our primary marketing tool, so it's an incredibly efficient way to go to market for a young company."

Dave's Hot Chicken has more than 773,000 followers on Instagram and 420.2K followers on TikTok, less than Raising Cane's nearly 1.5 million combined followers and Chick-fil-A's 1.8 million followers on Instagram alone (its TikTok account has no content, but has more than 191,000 followers).

Brooke DiPalma is a reporter for Yahoo Finance. Follow her on Twitter at @BrookeDiPalma or email her at bdipalma@yahoofinance.com.

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