Cava’s CFO on its new $30 million facility—and the importance of buying sliced onions

“I have sliced onions,” CFO Tricia Tolivar told me. “Pickled onions are incredibly attractive to our guests. They love them, but it takes forever to slice the onions—and not to mention the tears that come along with that.”

To expedite food prep, Cava now buys sliced onions but “they’re still pickled in house, so the flavor is still incredible, and it takes off some of that burden for our team members,” added Tolivar, explaining how a strong understanding of a firm’s operations is critical for CFOs.

This is why, at least once a quarter, Tolivar and other Cava execs spend time working “shoulder to shoulder” with team members at restaurants, she told me. “I think it’s a fabulous opportunity. I learn something every time I go.”

Building on momentum

Washington, D.C.-based Cava has invested more than $30 million in a state-of-the-art manufacturing facility in Verona, Va., that began operations in the first quarter of 2024, Tolivar told me. The 55,000-square-foot facility will produce Cava’s dips, spreads, and dressings. A groundbreaking for the facility was held in October 2022. The company also has an existing facility in Maryland.

Cava opened its first fast-casual spot in 2011 in Bethesda, Md. The company began trading on the New York Stock Exchange under the symbol “CAVA” in June 2023. In Q4, revenue grew 52.5% to $175.5 million compared with $115 million in the prior year quarter. Same-restaurant sales grew 11.4%, beating expectations, and net income for the quarter was $2 million compared with a net loss of $18.8 million in the prior year quarter.

For fiscal year 2023, revenue grew 59.8% to $717.1 million compared with $448.6 million at the same time last year. (Cava originally planned to release quarterly earnings Tuesday after the bell, but instead issued its latest figures in a press release Monday night after another news organization broke the agreed-to embargo time.)

“What we’re finding now is that Cava really has the opportunity to create the next large-scale cultural cuisine category,” Tolivar said. The Mediterranean menu, which includes items like crispy falafel, hummus, Greek chicken, and grain bowls and pitas, is inspired by three of the cofounders, Ike Grigoropolous, Ted Xenohristos, and Chef Dimitri Moshovitis, all sons of Greek immigrants.

Cava purchased another Mediterranean brand, Zoës Kitchen, in 2018, and has completed all conversions to Cava units. At the end of Q4, there were 309 Cava restaurants in the U.S.—72 opened in 2023, and 28 of those were converted Zoës Kitchen locations. Tolivar said she expects to add about 50 more locations in 2024.

After having to raise prices about 3% in January, Cava likely won’t do so again in 2024, Tolivar said. “I know that many others are potentially increasing pricing in California in response to the most recent legislation, but our view is just because others are doing it, it doesn’t necessarily make it right.”

(Chipotle CFO Jack Hartung told me earlier this month that the FAST Act, California’s new minimum wage law that pays fast food workers $20 an hour is “likely to lead to some pricing action.”)

Before joining Cava in 2020, Tolivar served as finance chief at GNC and also the Greater Memphis Arts Council. Before that, she held financial leadership positions at Ernst & Young and at AutoZone.

So why Cava? She said it was a combination of the brand’s “white-space opportunity” to make a big impact, working alongside Cava cofounder and CEO Brett Schulman, and the team’s “deep understanding and passion for guests and our food.”

Her favorite Cava dish? She couldn’t pick just one. But, she added, “my indulgence, and the thing that I think is most craveable, is our pita chips. They certainly accompany many of my bowls. And they’re my 13-year-old’s absolute favorite.”

Sheryl Estrada
[email protected]

Leaderboard

Dean Butler was named SVP and CFO at Silicon Labs (Nasdaq: SLAB), a wireless technology provider, effective May 15. Butler will succeed Mark Mauldin, currently serving as interim CFO. Butler joins Silicon Labs from Synaptics Incorporated, where he has served as SVP and CFO since October 2019. He previously held financial leadership positions at Marvell Technology, Inc., and at Broadcom, Inc.

Mika Ware was promoted to SVP and CFO at Brinker International Inc. (NYSE: EAT), a casual dining restaurant company, effective June 27. Joe Taylor, current EVP and CFO, plans to retire at the end of the company's fiscal year in June 2024 after almost 25 years at the company. Ware is currently VP of finance, investor relations, and restaurant development. 

Big deal

According to Pew Research Center, 35% of workers in the country’s 10 highest-paying occupations are women, up from 13% in 1980, a November 2023 analysis of Census Bureau data shows. Although women have increased their presence in almost all of these high-paying jobs, they are still the minority in nine of these jobs, Pew found. Except for pharmacists: 61% are women. The share of women in the other nine occupations remains, "well below their share in the U.S. Workforce overall," the report states.

Going deeper

How the CFTC Stays on Top of Financial Market Innovations, a report in Wharton's business review, explains how the U.S. Commodity Futures Trading Commission has fostered collaboration with other financial industry regulators while maintaining its independence.

Overheard

“We’re moving into this domain where money isn’t viewed as a tool or agent to prosperity, it’s viewed as something that is very limited and that needs to be held close.”

—Michael Liersch, head of advice and planning for Wells Fargo, told Coins2Day. Liersch explained the results of the latest Wells Fargo Money Study that shows concerns about money are translating to consumers cutting back on their spending, delaying life plans, and making some tough financial choices.