Sweetgreen, the quick-serve salad chain out to take advantage of consumer interest in sustainability, this week became the latest restaurant chain to file for an initial public offering.
And, experts say the move couldn’t come at a better time.
Sweetgreen says it has a mission: to build “healthier communities by connecting people to real food.” That means building a “transparent supply network” and cooking from scratch, and in the process inspiring devotion among its customers.
“Sweetgreen stands alone among the major U.S. quick-service restaurant chains in its commitment to sourcing from farms following regenerative practices,” Paul Lightfoot, founder of BrightFarms, told The Food Institute. “As consumers become increasingly aware of the opportunity to reverse climate change with food produced regeneratively, Sweetgreen’s competitive advantage will increase.”
A HEALTHY OUTLOOK?
Carter Seuthe, CEO of Credit Summit, said the Sweetgreen business model is “the natural evolution of the farm-to-table movement. It makes people feel good about where and what they’re eating.”
The 140-restaurant chain opened its first eatery in 2007 in Southern California, founded by three college students who developed the concept because they were looking for a healthier way to eat. Sustainability is a key tenet of the company’s philosophy and officials have pledged to become carbon neutral by the end of 2027.
But the company has yet to make a profit, and losses widened during the pandemic to $141.2 million at the end of 2020 on revenue of $220.6 million, CNBC reported (Oct. 26).
The chain currently operates in 13 states and hopes to double its footprint within five years.
SUDDENLY, IPOs ABUNDANT
Brian Dechesare, former investment banker and CEO of financial career platform Breaking Into Wall Street, said food-based IPOs have done well so far this year.
“They’re in a strong position for big growth, and their IPO is essential to those ambitions,” Dechesare said.
The IPO comes as more Americans are identifying as “flexitarian” and nearly a fourth say they want to reduce animal-based products in their diets to reduce greenhouse gas emissions. Lana Khabarova of SustainFi, said the vegetarian/flexitarian movement will only grow from here, and though sustainability is a nebulous term to most consumers, they do associate it with something that is “climate-friendly, green and healthy when used in relation to food.”
In addition to changing the way customers think of food, Sweetgreen is out to change the restaurant model. While the chain has tested a unique drive-thru concept in Colorado (QSR Magazine, Dec. 2020), its newest location in Tower 3 of the World Trade Center in New York is an airy 2,360-square-foot affair without indoor seating. Instead, it has a pickup station that caters to those who prefer to order their meals online.
Fortune reported (Oct. 26) the location incorporates COVID health measures and was inspired by Santiago Calatrava’s Oculus.
“We’ve evolved our customer experience with new safety standards that focus on crowd management and minimizing contact points,” Nicolas Jammet, co-founder and chief concept officer, told Fortune. “We are building our stores with the flexibility to transform throughout the day to provide our customers and team members a safe environment and keep them connected to real food.”