A big Red Robin franchisee doubles down on the brand

A sign on LVRB’s Red Robin restaurant in Collegeville, Pennsylvania. | Photo: Shutterstock

Lehigh Valley Restaurant Brands (LVRB) has been operating Red Robin restaurants since 1993 and has been through a lot of ups and downs with the casual-dining burger brand since then, including the Great Recession and the pandemic. 

Red Robin is currently in another transitional phase as it works to shake traffic declines over the past few years, a process that will include the closure of up to 70 locations by 2030.

As it has been for over 30 years, LVRB is along for the ride and then some: It recently acquired four Red Robins in Dallas from fellow franchisee Mandes Restaurant Group. The restaurants are LVRB’s first outside of Pennsylvania, and will make it the largest Red Robin franchisee by unit count with 24 locations.

“We’re very committed to the brand,” said Mike Axiotis, CEO of LVRB, in an interview.

Nevertheless, when Mandes owner Bob Mandes approached LVRB about acquiring his restaurants a couple of years ago, the company wasn’t so sure. It had just begun operating Wingstop stores in Pennsylvania, and it was hesitant about juggling those new responsibilities while also running Red Robins out of state.

The two sides kept talking, though, and as LVRB began to feel more confident in its new dual-brand structure, it began to think more seriously about branching into Texas. What helped seal the deal was the fact that Mandes’ longtime VP of operations had agreed to stay on and help run the Dallas stores, Axiotis said. 

“This was really a turnkey operation and one where it’s … kind of like a hand-in-glove fit from a cultural standpoint and a people and leadership standpoint,” Axiotis said. “The only difference was that it wasn’t in our backyard. So we just had to get past that and understand that that wasn’t as big of a deal as we may have thought it was.” 

On the whole, Englewood, Colorado-based Red Robin has struggled recently, with systemwide sales down about 4% last year. LVRB has been an exception, outperforming both the franchise and the broader industry, Axiotis said.

And he said LVRB is encouraged by Red Robin’s latest moves to right the ship. New CEO David Pace has rolled out a strategy called the First Choice plan aimed at boosting traffic, updating its restaurants and stabilizing its finances. It will also entail selling some of Red Robin’s 400 company-owned locations to franchisees. 

The first big piece of the plan is a new $9.99 value meal promotion, the Big Yummm meal, geared toward price-conscious consumers. It’s Red Robin’s first such meal deal in over 10 years, Axiotis said, and it has helped generate both traffic and sales growth for his restaurants. 

In the third quarter, Red Robin’s systemwide traffic fell 3% year over year, but it improved over the course of those three months, thanks in part to Big Yummm, the company said on its earnings call earlier this month.

“The industry has hit a tipping point in how much more price can we take, and how much the consumer can absorb,” Axiotis said. “So you’re seeing a lot of brands that are moving to value again and bundled meals, and I think that’s a good strategy to reengineer menus without having to lower your prices.”

“I applaud Dave Pace as the CEO and how he’s leading us with the First Choice plan,” he added.

Besides investing in operations and well-maintained restaurants, the secret to LVRB’s long-running success, Axiotis said, has been building strong ties to the community. The company sponsors local sports teams and supports a number of charity efforts. It has raised more than $2 million over the years for Blood Cancer United in honor of LVRB founder Stephen Hanzlik, who died from leukemia in 2010. This approach has helped ingrain LVRB’s restaurants in the areas it serves. 

“I really do think that that is a key differentiator for us,” Axiotis said. “Our guests recognize it when they come in and dine in our restaurants. They pull our managers to the side and say ‘Hey, thank you. We saw you at this walk, or we saw you at this event, and because of that we support your restaurant.’”

Much of that community work is powered by LVRB’s in-house marketing department, which goes beyond the marketing support it gets from the franchisor. It gives LVRB’s marketing a more grassroots angle and helps put a local face on the brand, Axiotis said.

It’s a strategy the company has adopted for its Wingstop stores as well, and something it plans to implement at its new restaurants in Texas, too. 

“In both the brands we operate, we spend more than what’s required of us, and we see that as an investment in driving incremental sales into our restaurants,” Axiotis said.

An industry lifer, Axiotis grew up working in his family’s Greek diners and in 1998 joined LVRB as an assistant manager when it had just two Red Robins. He climbed the ranks over the next two decades to become president, CEO and part-owner of the company. 

He’s also served on the boards of the Pennsylvania Restaurant and Lodging Association and the National Restaurant Association, and will serve as the national association’s chairman for 2026.

An “eternal optimist,” Axiotis believes next year will be better for the industry than 2025 has been.

“Our industry is a resilient industry, and whatever you put out in front of our industry, the operators and the innovators figure a way out,” he said. “I think we’ll be facing similar challenges [next year], but once we get through the early part of the year and the back half of the year, I think things should get a little bit easier. Not easier, but a little bit easier.”

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