How Dig finds new digs

While fast food chains like McDonald’s and Wendy’s have recently cut prices to lure back customers, fast-casual restaurants are thriving. The fast-casual segment’s sales grew 11.2% last year, according to Nation’s Restaurant News, exceeding those of the quick-service, family-dining, and casual-dining sectors by a healthy margin. Against this backdrop, New York City staple Dig has plans for expansion.

Dig, founded in 2011, focuses on locally sourced, healthy, and approachable food. The company owns 32 restaurants, 20 of them in New York City and others in locations like Boston, Philadelphia, and Washington, DC.

Now, it’s got plans to open more stores in the Northeast and Mid-Atlantic, its CFO, Jasmine Chiaramonte, told Retail Brew. But sustaining growth in this challenging economic environment for consumers isn’t easy. She spoke with CFO Brew about how Dig’s keeping its brand intact as it expands, and how it places new locations.

Focus on quality. When you’re in a growing company, it can be easy to “lose track of what got you to become a growth brand in the first place,” said Chiaramonte, who was recently promoted to CFO from her role as VP of finance. In Dig’s case, that brand is built on the quality of its food, she said.

The high quality of the food means customers are willing to pay a little more for it, Chiaramonte said.

“It’s not going to be the cheapest lunch. You can go buy a value meal somewhere else, but dollar versus quality we have no concerns about the product that we’re providing,” she said.

Local sourcing brings constraints as well as advantages: Chiaramonte said Dig is committed to sourcing much of its food locally, which was a boon to the chain during the pandemic, when supply chain snarls caused delays.

“We’re in the Northeast. We have access to a lot of local food and produce,” she said. “I don’t think we were impacted as much as some other national brands.”

However, the desire to use local products also means that Dig must plan its growth with care. The company wants to ensure that when it enters a new market, it’s “able to put out the product that people would expect if it was in New York City,” Chiaramonte said.

For now, it’s looking to launch new stores within its current map. There’s a lot of “white space within our existing markets, filling in that I-95 corridor between Boston and Washington, DC,” she said.

Originally, Dig was “hyperfocused” on “core urban markets,” she said, adding that its strategy now is to use those downtown restaurants to “build brand awareness” and then branch out to “urban residential” or suburban areas.

For instance, Chiaramonte said, in the Washington, DC, market, it started with a restaurant in Georgetown and then opened one in Bethesda, Maryland. “Obviously, work life has changed for a lot of people” in the past couple of years, she said, and Dig’s strategy reflects that.

How Dig finds new digs: Chiaramonte brings a secret weapon to her role: expertise in commercial real estate. Earlier in her career, she spent 11 years at real-estate trust PREIT. That made her a natural fit to lead Dig’s new store development and growth plan.

Dig uses software to help it analyze potential new locations, she said. Once they’ve found one, she and other team members work with brokers and visit the site to get a sense of traffic patterns and the like. If they think it’s a good fit, they’ll then present it to Dig’s real estate committee to get the go-ahead.

It’s not surprising, then, that Chiaramonte’s advice to people who aspire to the CFO seat is to develop themselves in areas beyond finance.

“Whatever business you’re in, being able to unlock one more area of expertise will help,” she said. It’s also a good idea to learn new areas of the company you’re in, she added.

“It’s very easy for a finance person to hide behind the computer screen,” she said. “But if you can learn different areas of the business where you can add value, that is probably the best way to become a CFO.”