Icon (Close Menu)

Logout

Partners Work To Revive Back Yard Burgers Brand

3 min read

Josh Powell and his father, Gifford, are working to revive a brand once popular in central Arkansas: Back Yard Burgers.

The chain, founded in 1987 in Cleveland, Mississippi, moved its headquarters to Memphis in 1990. In 2007, it moved again, this time to Nashville, Tennessee. In October 2012, Back Yard Burgers filed for Chapter 11 bankruptcy protection and announced the closing of many of its stores, including all eight of its corporate-owned stores in Arkansas: six in the Little Rock area and two in Jonesboro. That left only six franchise restaurants.

The Powells’ two restaurants were among the six that survived. Father and son — Gifford lives in Benton; Josh lives in Little Rock — had opened their Bryant location in 1998 and acquired the Benton Back Yard Burgers in 2012, Josh Powell said.

But the corporate bankruptcy “almost decimated us,” Powell said.

The Powells had planned to buy more stores with an eye toward expanding along Interstate 30. But when HQ shut down the corporate stores, customers thought the franchise stores were closed as well.

“2013 was probably the worst year we’ve ever had,” Powell said. “We didn’t know what we were going to do, if we were going to be able to survive.”

Father and son persevered and business has revived. “We’re tracking double-digits up right now,” Powell said.

They bought what had been a corporate Back Yard Burgers in Jonesboro and last month reopened it as a franchise store, with about 15 employees. They have 15-20 employees at each location and expect to hire five more at Jonesboro.

After filing for bankruptcy, listing assets of as much as $10 million and debts of as much as $50 million, Back Yard Burgers received a $14 million infusion from new owners, Pharos Capital Group of Nashville, a private equity firm. The restaurant company also got new leadership in January 2013, naming David McDougall as CEO, and it emerged from bankruptcy four months after filing.

Powell said the new leadership had made a big difference. “Dave McDougall has a lot to do with the turnaround” of the company, Powell said. “We as franchisees didn’t trust the franchisor. … I think you had a lot franchisees going rogue and doing crazy stuff.”

Now, however, McDougall “is kind of winning back our trust by doing things the right way,” Powell said. “He’s actually giving us a reason to be proud of having the name Back Yard Burgers.”

The Powells’ Benton store pulled in about $650,000 in revenue last year, their first full year of ownership. Bryant did about $700,000 in 2014, Powell said. And he’s anticipating Jonesboro revenue at about $700,000. Father and son are interested in opening more stores in the Little Rock area, Josh Powell said.

Monte Jump, who joined the company eight weeks before the bankruptcy filing, is the chief operations officer and marketing officer of Back Yard Burgers in Nashville. He told Arkansas Business that the company had been “getting back to the basics, trying to manage our unit-level economics at the store level.”

Back Yard Burgers has seen 23 consecutive months of growth, Jump said. It now has 23 company-owned locations and is seeking new investment with new franchisees.

“We spent the last two years getting the company stabilized and proving this thing out,” Jump said. “We are ready for some pretty explosive growth.”

Send this to a friend