The restaurant industry is competitive, but few brands have heated up the market quite like Dave’s Hot Chicken. Starting as a humble parking lot pop-up, the brand is on track to finish the year with nearly 400 locations.
In a recent episode of Behind the Numbers, we sat down with CFO James McGehee and SVP of Finance Scott Putman to dig into the data. Here is how they successfully scaled a spicy chicken brand into a household name.
When you serve a focused menu, the quality of your protein is everything. Dave’s Hot Chicken goes through approximately 25 million pounds of chicken (about 50 million chickens) and 30 million pounds of potatoes annually. To differentiate themselves, they strictly use “extra large” birds (8–11 lbs) rather than the industry-standard medium birds, ensuring a tender mouthfeel and a quarter-pound tender that customers crave.
Growth relies on happy operators. James McGehee notes that their model boasts an Average Unit Volume (AUV) of roughly $3 million with a payback period of just two years. By focusing on a “franchisee-first” mindset, they have attracted experienced operators from major brands like Dunkin’ and Jersey Mike’s. As McGehee puts it, “You could make 5% in the money market, or you could make 50% in Dave’s”.
Going from 7 stores to 400 requires robust infrastructure. Scott Putman credits their ability to scale to their tech stack, specifically Restaurant365. The platform allowed them to manage over 70 legal entities and process royalties in 15 minutes, a task that previously took entire days. This efficiency allowed a lean corporate team to support massive expansion without breaking.
“I could get done with royalties on a Monday morning for the prior week in about 15 minutes, with confidence.” Says Scott, “Historically, in prior roles, it could be a half a day to a day of validation and processing to figure that out.”
Unlike competitors with cookie-cutter interiors, Dave’s treats store design like its spice levels. Locations range from “Mild” to “Reaper” regarding design intensity, often featuring custom graffiti art unique to the region. This attention to “vibe” transforms a quick-service meal into an Instagram-ready destination, driving sales and customer engagement.
While chicken is king, Dave’s isn’t afraid to innovate. They successfully launched cauliflower tenders to capture the vegetarian vote—a move Scott Putman says brings his own family back to the restaurant frequently. They are also experimenting with “Dave’s After Dark” to capture the late-night crowd and social media trends like boba-topped tenders.
Ready to dig deeper? Listen to the full interview on Behind the Numbers to hear how Dave’s Hot Chicken plans to hit 520+ locations in the next two years.
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