Casual dining restaurateur, The Cheesecake Factory Inc. (CAKE), which currently boasts nearly 176 restaurants across the United States, has unveiled a restaurant in Novi, Mich. This is the third of the company’s targeted 8-10 outlet openings in 2013 and bears evidence to its strategy of expanding in the lucrative domestic market.
The restaurant, located in the Twelve Oaks Mall, marks Cheesecake Factory’s debut in Michigan. The 8,400 square foot-restaurant can accommodate around 225 diners at a time.
A major regional shopping center, Twelve Oaks Mall, is strategically located at the intersection of I-96 and Novi Road. The shopping centre boasts stores of major American retail giants such as Nordstrom Inc. (JWN) and Macy's, Inc. (M). We believe that the restaurant’s strategic location, along with its attractive menu and contemporary ambience, will drive traffic, going ahead.
According to the National Restaurant Association, the restaurant industry of Michigan acts as a major catalyst of its economic development. The Michigan restaurant industry is projected to generate around $13.1 billion in revenues in 2013. This factor has also caught the attention of another restaurateur, McDonald's Corp. (MCD), which made their presence felt in the state. We believe, Cheesecake Factory’s venture into the untapped market of Michigan, one of the most densely populated U.S. states, will immensely benefit it in augmenting its sales.
The Zacks Rank #3 (Hold) company is growing on both national and international fronts. Also, Cheesecake Factory is actively expanding its other formats of different sizes and scales to cater to local demand. The company’s smaller prototype restaurants will likely accelerate its growth in non-traditional locations and also improve return on invested capital.
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