Red Robin Restaurants Eliminate All Busboys
The national restaurant chain Red Robin announced it would eliminate busboys at all of its 570 restaurants, as the company expects it will save $8 million in 2018 by doing so. Red Robin’s chief financial officer Guy Constant told attendees at the ICR retail conference, “We need to do that to address the labor increases we’ve seen.” Michael Saltsman, director of the Employment Policies Institute (EPI), told FOX Business, “I read that as minimum wage. Somebody like Red Robin, which has a lot of exposure in western states [where the minimum wage is rising faster] … this is sort of a burger and beer chain. If they can’t pass those increases off in higher prices … they have to find a way to do more with less.” 851Franchise.com editor-in-chief Nick Powills added, “From a business standpoint, [Red Robin made a] very smart move. From an employee standpoint, you just cut out $8 million worth of labor. The interesting thing about the minimum wage hike is that those that made the decisions to do it, did it on behalf of the employee … when intentions are good, and you can’t appease everybody, someone is going to eventually be on the short [end of the] stick.” The Colorado-based chain, whose outlets are found primarily in western states, already eliminated expediters, who take the food from the cooks and place it on plates for the servers; that saved the company almost $10 million last year. Saltsman added, “I think the loss, as the minimum wage goes up … [is the] hollowing out of entry-level opportunities,” As FOX Business reported, “Earlier this year, a study conducted by EPI, which analyzed employment trends from 1990 through 2017, found that each 10% increase in the minimum wage in California has resulted in a corresponding 2% decline in employment for affected employees. The impact was larger, 5%, for lower-paid workers.” – Source: The Daily Wire.
Edward Don & Company Acquires Smith & Green Company
Edward Don & Company, a Woodridge, Ill.-based foodservice equipment and supplies dealership, has acquired Smith & Green Company. Terms of the deal were not disclosed. Smith & Greene, a Kent, Wash.-based foodservice equipment and supplies dealer, will operate as a wholly owned subsidiary of Edward Don & Company and will remain under the leadership of Brad Smith and Garrett Mullen, who will serve as co-presidents. This deal represents Edward Don & Company’s second acquisition since Vestar Capital Partners made an equity investment in the company in March 2017. In November 2017, Edward Don & Company acquired Atlanta Fixture. – Source: Edward Don & Company.
Culinary Collection Cruises on Windstar
Culinary travel reaches a new zenith now that the James Beard Foundation has launched its Culinary Collection series of eight 2017-2018 cruises onboard Windstar’s small luxury cruise line. On its fleet of bespoke yachts, Windstar has launched its stellar James Beard program with exclusive menus created and prepared by guest chefs, including “Top Chef” judge Hugh Acheson and Renee Erickson, the Seattle-based chef who won the 2016 James Beard Award for Best Chef: Northwest. Regionally and nationally celebrated chefs – including Andy Ricker, Keith Rhodes and Mario Pagan – are booked to travel on special 2018 cruises and will rotate original recipes onto ship menus throughout the coming year.
The first James Beard cruise of 2018 is “Icons of Southeast Asia,” a 14-day journey on the Star Legend, embarking on January 20 from Hong Kong to Bangkok. It features two-time James Beard award-winner Andy Ricker, the celebrated Thai cuisine chef known for his trendy Pok-Pok restaurants in New York and Portland, Oregon. Each year, he spends several months in Thailand, studying the food culture there and in neighboring countries, including Vietnam, but this will be his first time accompanying an intimate group of passengers. Each night, he will serve 200-300 cruisers a signature dish in the Star Legend’s AmphorA dining room, and will host a private cooking demonstration. The ongoing infusion of new destination-inspired locavore fare created by James Beard-affiliated chefs will enhance Windstar dining experiences as the culinary partnership rolls out and expands. While megaships continue to license celebrity chef restaurant franchises-at-sea – most notably Nobuyuki “Nobu” Matsuhisa (Crystal), Jamie Oliver (Royal Caribbean), Jacques Pepin (Oceania), Thomas Keller (Seabourn), Arnaud Lallement and Scott Hunnel (Disney), Jose Garces (Norwegian), Guy Fieri (Carnival), and Curtis Stone, Ernesto Uchimura, and master chocolatier Norman Love (Princess) – Windstar’s small fleet of intimate ships and yachts goes the extra mile to create personalized local dining experiences with a carefully-curated selection of eight James Beard award-winning chefs traveling alongside passengers, with special nightly menus included at no additional charge. “While some cruise lines boast a celebrity chef or offer a special restaurant experience on board for an additional fee, we have an entire arsenal of chefs who give us the ability to focus on regional cuisine that’s aligned with each chef’s specialty,” said Windstar President John Delaney. “This equates to more memorable meals at sea, prepared with locally-sourced ingredients by some of the most recognized culinary talent in the world – all as part of our regular Windstar guest experience.” – Source: The Los Angeles Times.
Red Robin Lays off Some Field, Corporate-Level Staff
Red Robin Gourmet Burgers Inc. this week laid off a number of field and corporate-level workers, the company confirmed. The Greenwood Village, Colo.-based brand said “the casual-dining marketplace has changed dramatically in recent years and our guests’ needs have evolved,” according to Kevin Caulfield, Red Robin spokesperson, in an email. To remain a strong and growing restaurant brand, Red Robin’s priorities and choices for where we dedicate resources must also change, so we are resetting our organization for the future of our business and the changes include the elimination of some positions in the field and at the home office,” Caulfield said. “While some roles have been eliminated and some functions have been reduced, Red Robin does plan to hire in areas that will support future growth,” he said. Positions included area directors, one source said. Other casual-dining brands have reduced positions at the field and corporate level as well. Last January, Chili’s Grill & Bar, the division of Dallas-based Brinker International Inc., laid off about 50 employees from its corporate staff and more than 30 people from its field director team in a restructuring. Earlier this week, Red Robin executives said they were also trimming in-restaurant positions, including the expeditor in the kitchen and bussers for clearing tables. Guy Constant, Red Robin chief financial officer, on Jan. 8 told ICR Conference attendees that the company was working to reducing labor casts. “We started in the fourth quarter in a really significant way by eliminating the expeditor position,” Constant said, which he said would provide about $8 million a year in labor savings. “We’re in the process of this quarter now of eliminating the busser position in our restaurants.” “We need to do that in order to address the labor increases we are seeing,” Constant said. Caulfield said Thursday that employees at the restaurant level could apply for other positions. “Some team members formerly in those roles may have opportunities to transition to other Red Robin positions,” he said. “The restaurant level-changes are taking place in company-owned units.” Red Robin owns about 480 of its more than 560 locations. Last week, Red Robin named a new human resources leader, appointing Beverly Carmichael as chief people, culture and resource officer. Carmichael most recently served as chief people officer for Lebanon, Tenn.-based Cracker Barrel Old Country Store Inc. In November, Red Robin said it would be pausing unit growth after fiscal 2018 in order to evaluate the company’s strategy. For the third quarter ended Oct. 1, which included an income-tax benefit, Red Robin swung to a profit of $2.7 million, or 21 cents a share, compared to a loss of $1.3 million, or 10 cents a share, in the prior-year period. Analysts had forecast earnings of 28 cents a share. Revenue in the quarter rose 2.3 percent to $304.2 million from $297.3 million in the same quarter last year. Same-store sales declined 0.1 percent in the quarter, driven by a 0.1 percent decrease in average guest check and flat guest counts. – Source: NRN.
Plans to Convert up to 12 Locations to –commerce Fulfillment Centers
Walmart, Inc. said it will close 63 Sam’s Club locations nationwide and convert up to 12 of the affected clubs to e-commerce fulfillment centers in a move to speed delivery of online orders. Following the closures, the company will operate 597 Sam’s Club stores. “Transforming our business means managing our real estate portfolio and Walmart needs a strong fleet of Sam’s Clubs that are fit for the future,” said John Furner, president and chief executive officer of Sam’s Club. “We know this is difficult news for our associates, and we are working to place as many of them as possible at nearby locations. Our focus today has been on those associates and their communities, and communicating with them.” The first of the converted e-commerce fulfillment centers will be located in Memphis, Tenn. The company said it will provide support and resources to affected employees. “We need great people to help lead us into the future and we hope that many of them will stay with the company at either a local store or club,” Mr. Furner said. “Change is never easy, but we’re making these decisions as part of running a healthy business.” Walmart said it will record a discrete charge of approximately 14c per share related to the actions. Source: FoodBusinessNews.net
Oneida Group CEO Patrick Lockwood-Taylor Discusses The Strategies and Future Of The Company and Brands
As nearly everyone in the foodservice market knows, the parent company of Oneida and Anchor Hocking, among America’s most recognized foodservice and retail tabletop brands, has weathered more than one storm since the beginning of the Millenium. The forces of globalization, the demands of American finance and other factors led to two bankruptcy filings, supply chain issues, and an almost constant state of turmoil. Since filing a pre-packaged bankruptcy in 2015 and returning to private status, then naming Patrick Lockwood-Taylor, a P&G veteran, as CEO in May 2016, the company has stabilized. After operating for several years under the name Everyware Global, the company renamed itself the Oneida Group. In addition to the Oneida and Anchor Hocking brands, it also includes Buffalo, Delco, and Sant’Andrea among its key offerings. Lockwood-Taylor brought in key executives from outside the foodservice market and that has created some uncertainty in the industry about the company’s strategies, particularly around its go-to-market and distribution strategies. Foodservice Equipment Reports asked Lockwood-Taylor to discuss these, as well as its current and future plans. Publisher Robin Ashton interviewed Lockwood-Taylor in December.
Can you first address the Oneida Group’s financial stability? This, of course, was a problem a few years ago, but from what I’ve read and heard, no longer seems to be an issue. We are dedicated to rebuilding the Oneida and Anchor Hocking brands. There is real value in the brands and their heritage. I’ve spent my entire career creating and rebuilding brands and that’s why I’m here; to recapture what made them both iconic brands, including the community around the brands. In short, yes, two and half years ago, the company went through an unfortunate financial episode. The good news is that the company skillfully managed the emergence from bankruptcy. We now have new owners; financial institutions that are household names, who are dedicated to the company and have a very balanced view of what it takes for us to take back our place as category leader. We also have a new board, with very different ranges of backgrounds and experiences; they been very helpful. Today, our financial situation is strong. The leverage ratios are very reasonable. All aspects of the business are strong and getting stronger. In fact, compared to industry norms, we’re in a very good place. This question often comes from others in the industry, so I am glad you asked it, as it is my opportunity to set the record straight that we are strong and getting even stronger.
Who are the current senior managers? You’ve brought in a number of people from P&G and elsewhere and folks in foodservice just don’t know them. Yes, we have. It was a very strategic move on our part to bring in the right people. To do so, we started with the question: What’s our strategy? What will turn around the company, restore the brands and have reasonable financial outcomes? Lastly, we looked at the mission critical capability needs. Given trusted partners and myself have been around for a while, we knew a lot of people who could do the work and do it quickly. I’m never that hung up on where someone comes from. I don’t care about segment. I care if they understand branding and innovation, building organizations and strategic partnering and channel building. We have a new CFO, Aly Noormohamed, who joined us from Dr Pepper. Our CMO, Jeff Jarrett, and Chief Supply and Operations Officer, Michael Sullivan, both joined us last year from Berkshire Hathaway. We also have a number of people who grew up in the industry, and have been promoted from within like Jamie Keller, who has been with the company for nearly 10 years and now is General Manager of our Global Foodservice Division. That background is important in the mix. We have purposefully created an eclectic bunch in terms of industry experience and skills. We’ve transformed our executive leadership bench and our readiness to win. Our latest talent joined because they believe in the brands, the mission, our culture and camaraderie.
Let’s address the big topic: What’s Oneida’s go-to-market strategy, specifically for foodservice? There has been some confusion and misinformation here, I believe. Are you using direct factory reps, independent manufacturers’ reps, or a blend? Who calls on whom? We believe our principles are the same as big distributors. We ultimately need to create value for our end-user operators. We need brands that stand for more and are functionally superior to the alternatives. We’d like it to be clear to our mutual customers that we have those advantages. How do we work with these operators to ensure our brands are better meeting their needs, helping create equity with their customers, and are functionally superior to anything else they can buy? We aim to mutually understand what those needs are. We curate from what products we have or design new products that will better meet those needs. That’s the endpoint of how we go to market and we are looking to do that better than our competitors. So, there are a number of aspects to this process; first is investing in innovation. We focus on the needs of operators, so we’re more meaningfully innovating. We don’t create new products just to have new products. Each product is fulfilling a need of our customers. We are laser-focused on creating value for the operator—understanding the experience they are seeking to create and partnering to deliver that desired dining experience. Second, we see a lot of opportunity in smaller, underserved segments including gastropubs and fast casual, where bright white dinnerware isn’t going to cut it. When it comes to channel partners, we work with those that add value to the operator and help us add value to the end-user customer. Those who help us better understand our mutual customers’ needs and better communicate those needs to us and our solutions down to the customers. We’re all about creating more value for the end-user operator, in partnership with all the stakeholders. It truly is priority number one! We have very close relationships with TriMark, Wasserstrom, Edward Don, Clark, and many other dealers as well as the big broadline distributors, and these partnerships are core to our go-to-market strategy. The strategic agenda is really quite simple. How do we better integrate our processes with those dealers? What costs can we mutually eliminate or what services can we co-create so the operator clearly realizes the value of their brand and our brands? We look at each value chain and how we can integrate. We don’t just want to sell plates to dealers, who sell plates to the customer, we want to deliver more shared value by eliminating unproductive processes to make both of us more meaningful to the customer. If we don’t do it, Amazon will do it. So we are looking for strategic partnerships for the purpose of maximizing value to the end-user. Operators will not partner with any supplier who is inefficient. For example, take a look at a plate that is manufactured in Asia. We investigated the number of times it’s touched, stored, shipped, and what are all the add-on costs to that single plate, and how can we eliminate waste. What we’ve seen is huge opportunity in creating a world of lean logistics. In a world of increased operator demands, those who get an acceptable or exceptional product to the operator at the lowest cost will win. That said, we are working with our partners to integrate design and manufacturing processes, to create significant efficiencies. The point is this, when Amazon or Walmart enter a market, they are massively disruptive. Their processes and the ways they manage them are so far beyond what most others do. They can obsolete supply chains overnight and they have. If channel partners and operators are not thinking about these things, they will be out of business. And, as the operator begins to understand the disruption that is coming, it will demand even more from its suppliers. We are here to help with all of that. As mentioned, we have the right leadership team with the right kind of expertise in this space. I think there is a role for great brands that are innovative and that know how to manage the entire process. There is a role for more competitive distribution and the corresponding cost benefits. Operators are simply less willing to pay for brand proliferation, meaningless innovation, and inefficient supply chains.
What’s your dealer strategy? Do you remain in any buying groups? Is your strategy for broadliners different? We are excited by some buying groups. We are even more interested in folks helping us with the upstream process. With distributors, it’s about those that truly want to better serve the operator.
How are you handling national accounts, specifically in hospitality, and how does that intersect with your distribution strategy? Hospitality and national accounts is an important part of our heritage and a strategic component of our foodservice business. We have a specialized and experienced sales force dedicated to this segment and we just recently added some great talent to this team. The operator determines distribution. We provide options and they tell us how they want to do it. That’s our strategy. We have to be distribution neutral. We also are putting more dedicated resources against this segment, including improved research and innovation that best suits their business needs. We believe there’s a great opportunity here. We have always been operator-focused in this segment as well. We think it’s critical. Again, we are distribution agnostic. It really boils down to trust. We want everyone to know that the guts of our go-to-market strategy are strategic partnerships and functional superiority.
Just for contrast, how do you handle sales and distribution in retail? How is that part of the business doing? We want to create a brand that is more meaningful in the heart and mind of consumers – more useful in a meaningful, real way and better than our competitors. Many segments are flat to declining because of commoditization, which means it all comes down to price. We’ve pushed hard on product innovation to overcome those barriers. We work together with retailers on shopper-based design that more meaningfully displays the products and builds categories. We’ve also focused on more sophisticated supply chain management. We are seeking out those partners that recognize the value of what I just said and want to work with us to grow through both innovation and better value. We are working across the retail channels: Mass-Market, Dollar, and so on. We create more value working across the entire potential customer base. I’ve said it before: Better value for consumers and customers through more meaningful innovation, but also through lower cost.
Supply-chain issues were a big problem a few years ago. Have these mostly been rectified? Our customer service in foodservice is extremely strong. Our line fill rates are now among the best in industry. We are constantly looking at how we can better manage supply chains, warehouses and how we manage SKUs for better scale opportunities. This creates more valued customer service, at lower cost. We have an advantage in operating in three divisions, which gives us scale and distinguishes us from competitors. We consistently look at ways to leverage that scale, which is harder for small sector competitors and allows us to reinvest in superior innovation.
Most of the industry is aware of the problem with Sant’Andrea. (A competitor bought the factory in Thailand that was producing Sant’ Andrea.) Can you discuss the issue and how you are addressing it? Are things fine with the other core brands? It’s very simple. We own the Sant’ Andrea marks, including Botticelli. We believe very, very strongly in free and fair competition that recognizes legitimate brand ownership. Anything we feel contravenes that; we will aggressively defend, and will do that in an honest, ethical, straightforward way. It’s no issue for us anymore. We are free to practice under these marks. We have an alternative supply chain we believe to be superior in terms of value and design. It creates an equal or better product, and it also gives us more room for innovation. Our customers and operators get better value and innovation.
What’s Oneida’s foodservice strategy going forward? What do you see as your strengths and weaknesses? We’re a long way through our transformation. I think we’ve put back what made Oneida the iconic brand it has long been, by going back to the roots. We’ve reestablished our historical core strengths. The weakness, always, is time. I wish we could get the value proposition in the hands of the operators sooner. We’d like to create more awareness of the value proposition, more quickly. – Source: FER.
Modern Casual Restaurant
Frank Lloyd Wright made his name by designing spaces that connect with nature. The surroundings helped define what the building would look like and how it would function. Wright’s buildings left their marks in a major way. His architecture remains an example of how one person’s perspective can influence the look and feel of our environment for years to come. Wright died in 1959, but his vision is alive and well, evidenced by one of today’s most successful restaurant designers, who is reviving elements of Wright’s design to create a restaurant that’s both an echo and completely new. That’s what Jeffrey Beers, principal and founder of design firm Jeffrey Beers International, has done with his design of Firepoint Grill, a project in Newtown, Pa., for client George Paxos of Paxos Restaurants. “He wanted a modern and casual restaurant that is very warm and comfortable for his guests…all the cooking is done on an open-fire grill,” Beers said. Those key words — warm, comfortable, fire — build a bridge in Beers’ mind directly to the fundamentals of Wright’s designs. What is it about Wright’s aesthetic that adapts so well to hospitality? “I think the level of custom details in finishes, art and furniture are all key to Frank Lloyd Wright interiors, and are also elements clients expect for their projects,” Beers said. Wright designed a restaurant, the Riverview Terrace Restaurant, near his Taliesin estate in Wisconsin, which has since become the café of the Frank Lloyd Wright Visitor Center. Wright also designed the Imperial Hotel in Tokyo in 1924, which no longer exists, but Beers had a chance to visit it once. Here’s how Beers turned inspiration into a brick, wood and slate reality. – Source: Restaurant Hospitality.
Food Recall Process Sometimes Falls Short of Ensuring Total Safety
The Food and Drug Administration’s food recall process sometimes falls short of ensuring the safety of the nation’s food supply, according to a review published by the Office of the Inspector General of the Department of Health and Human Services in late December. The conclusion reflected findings of a review of documentation related to 30 voluntary food recalls “judgmentally selected” from the 1,557 food recalls reported to the F.D.A. between Oct. 1, 2012, and May 4, 2015. The O.I.G. said prior reviews of the F.D.A. food recall process were conducted before the passage of the F.D.A. Food Safety Modernization Act, which, among other things, granted the F.D.A. authority to order mandatory recalls and require companies to recall certain harmful foods. The O.I.G. also noted it had issued an early alert memorandum to the F.D.A. in June 2016 raising concerns that the F.D.A. did not have adequate policies and procedures to ensure that companies take prompt and effective action in initiating recalls.
The memorandum and the review that culminated in the December report encouraged the F.D.A. to make major changes in its oversight of the recall process. The O.I.G. review identified deficiencies in F.D.A.’s oversight of recall initiation and monitoring and in recall information captured and maintained in the recall enterprise system (R.E.S.). Specifically, the O.I.G. found that the F.D.A. could not always ensure that companies initiated recalls promptly. The O.I.G. also found that the F.D.A. did not always evaluate health hazards in a timely manner, issue audit checks at the appropriate level, complete audit checks in accordance with its procedures, collect timely and complete status reports from recalling companies, track key recall data in the R.E.S., and maintain accurate recall data in the R.E.S. Recalls were not always initiated promptly because the F.D.A. did not have adequate procedures to ensure that companies take prompt action in initiating voluntary food recalls, the O.I.G. said. In addition, the F.D.A. had not established risk-based internal timeframes for reaching certain milestones, such as when to instruct recall staff to request that companies voluntarily recall their products, which delayed the F.D.A. from taking further actions in some recalls. The F.D.A.’s monitoring of recalls was not always effective because F.D.A. staff did not always follow procedures, or those procedures were inadequate, the O.I.G. said. As a result, the F.D.A. could not consistently ensure that the recalling companies’ consignees appropriately removed harmful products from retail stores and other points in the distribution chain. The O.I.G. review provided several recommendations, including establishing set timeframes for the F.D.A. to discuss the possibility of a voluntary recall with a company and initiating the use of its mandatory recall authority after it has determined that the legal standard for use of that authority has been met and a company is not willing to voluntarily conduct a recall. Another recommendation called for the F.D.A. to establish performance measures for the amount of time between the date the F.D.A. learns of a potentially hazardous product and the date a company initiates a voluntary recall, for monitoring performance and for refining operating procedures as needed. “A lot has changed since that timeframe when it comes to our food safety practices ,” said Scott Gottlieb, Ph.D., F.D.A. administrator. “But I know that much work remains to be done if we’re going to provide the highest assurance of safety. We’ve taken the O.I.G. recommendations to heart and worked quickly to put in place measures to address the proposals that the O.I.G. outlined.” Dr. Gottlieb said one of the most significant steps the F.D.A. took to improve recall procedure was the establishment of a team of senior leaders charged with reviewing complex or unusual food safety situations and determining the proper action to address the problem if it isn’t clear. The team meets at least weekly and makes recommendations about what actions to take and how to make sure they occur. “Over the past year, this team of senior leaders, called the SCORE team (Strategic Coordinated Oversight of Recall Execution), has made a big difference in these situations,” Dr. Gottlieb said. “In addition to facilitating recalls and import alerts for the detention of products entering the United States, SCORE initiated or helped to expedite the process for suspending the registration of two food facilities, actions that block the facilities’ ability to distribute food to the marketplace. “Building on these early efforts, we intend to say more in early 2018 on additional policy steps we’ll take as part of a broader action plan to improve our oversight of food safety and how we implement the recall process.” – Source: FoodBusinessNews. Com.
Processors Required to Produce Preventative Food Safety Plan
Processors would be required to produce preventative food safety plan documents and meet other sanitation requirements under a plan to align egg products inspections rules with those governing meat and poultry. The U.S. Department of Agriculture said the proposed rule seeks to modernize egg products plants’ inspection systems and require processors to use methods that produce finished products free of detectable pathogens. Businesses would be instructed to craft Hazard Analysis and Critical Control Points systems and Sanitation Standard Operating Procedures and meet other sanitation requirements contained in meat and poultry regulations. The plan calls for elimination of existing egg product provisions that don’t align with meat and poultry rules. The proposal was announced Jan. 9 by U.S.D.A.’s Food Safety and Inspection Service, which calls the amended rules a critical step forward in making egg products safer for Americans to eat. “As we continue to modernize inspection systems and processes, we are committed to strengthening consistency across the services that F.S.I.S. inspection personnel carry out for the consuming public,” said Carmen Rottenberg, acting deputy undersecretary for food safety. F.S.I.S. anticipates more efficient use of agency resources and elimination of regulatory obstacles to food safety innovation. The service said H.A.C.C.P. plans give processors the leeway to tailor food safety systems to their facility and equipment, and noted that 93% of egg products plants currently maintain written H.A.C.C.P. plans that address at least one production step in their process. “This proposed rule will ensure the same level of inspection and oversight of all regulated products as we carry out our public health mission,” Ms. Rottenberg said. A 120-day comment period will open upon publication of the intended rule in the Federal Register. – Source: Food Safety Monitor/FoodBusinessNews.com.
Ampex Brands is Continuing its Rapid Expansion
Fast-growing North Texas franchisee Ampex Brands is continuing its rapid expansion with the acquisition of 77 Pizza Hut units. The company purchased the pizza restaurants, all located in North Texas, from Pizza Hut’s corporate office last month. The deal adds $88 million to Ampex’s top line and makes it Plano-based Pizza Hut’s largest franchisee in North Texas, said CEO Tabbassum Mumtaz.
In the past three months, Ampex has also purchased 52 KFC restaurants in Columbus, Ohio, and Oklahoma City. Those deals have added another $144 million to Ampex’s top line. Ampex now owns 128 Pizza Hut units and 218 KFCs across the country. Its full portfolio, which stretches across 15 states, also includes 38 Taco Bells, 68 Long John Silver’s, and 49 Tim Hortons. “When you look at the team and they have the capabilities to grow, that’s exciting,” Mumtaz of what’s driving his company’s growth. “We give them part ownership in some of the stores. The owners that we have in our own company, we make them part owners based on their titles and how long they’ve worked with us. We make sure that our team grows along with us.” Funding for the acquisitions has come from Ampex’s profits and investments from the team’s friends and families. Mumtaz said the company is staying away from private equity investment. “We don’t go into acquisitions that we can’t afford,” he added. “We try to buy low and ensure that we turn the markets around.” Additional unit growth is on the menu for Ampex this year. It expects to announce at least two more large acquisitions in 2018, and open 17 stores across all of its brands. Last year, Ampex also expanded its real estate holdings, acquiring a nearly 17,000-square-foot Richardson office building that doubled the size of its previous headquarters. Employees moved from Ampex’s former Carrollton facility to the new campus at the end of the year. Mumtaz said he plans to convert the Carrollton building into a training and operations center. With the move, the company said in September it would consolidate 24 positions – potentially relocating employees – from its Cleveland office in hopes of bringing all of its workers under one roof. “Dallas is our base; it’s where our heart is,” Mumtaz said at the time. “People know us as being in Dallas. It’s the center of the world and it’s the most convenient place for our office today.” As Ampex continues to grow, Mumtaz added that he eventually hopes to open a build-to-suit headquarters along the Dallas North Tollway. He is already searching for potential sites. “We have already been talking to a couple of land owners that have shown an interest to sell,” Mumtaz added. “That area suits us; it’s central to our locations and close to Addison Airport, Love Field, DFW Airport — it would be very exciting to us.” – Source: Dallas Business Journal.
El Pollo Loco Franchisee Acquires Wendy’s Franchisee
WKS Restaurant Group, the largest El Pollo Loco franchisee, has acquired Pennant Foods Corp. and its 52 Wendy’s in Southern California, the company said this week. Lakewood, Calif.-based WKS, which now owns more than 180 franchise restaurants that include such other brands as Blaze Pizza, Corner Bakery Café, Denny’s and Krispy Kreme, purchased Pennant from funds managed by Boca Raton, Fla.-based Brockway Moran & Partners Inc. Brockaway had acquired Knoxville, Tenn.-based Pennant in March 2003. Terms of the deal were not disclosed, but financing was provided by CapitalSpring, a private-investment firm focused on the restaurant industry. Roland Spongberg, CEO of WKS, said his company has worked with CapitalSpring on prior acquisitions. “We have enjoyed a relationship with the firm since 2011,” Spongberg said in a statement, “and their consistent ability to leverage creative financing solutions to meet the needs of our business and our acquisitions makes them a trusted and reliable partner.” In addition to CapitalSpring, WKS’ existing senior lenders, led by Wintrust Franchise Finance, served as co-lenders on the Pennant deal. Wintrust Franchise Finance is a division of Lake Forest Bank & Trust Co. a Wintrust Community Bank. “WKS has a long history of growth and operational excellence across multiple concepts and geographies,” said Tee Isenhour, a principal at CapitalSpring, in a news release, “and we look forward to future opportunities together across their brand portfolio.” Capital Spring has about $1.3 billion in assets under management, representing about 4,000 restaurant locations, said Richard Fitzgerald (left), the company’s co-founder and managing partner, at this week’s ICR Conference. WKS, founded in 1987, is the largest El Pollo Loco and Krispy Kreme franchise group. Sheppard, Mullin, Richter & Hampton LLP served as legal advisor to WKS in the transaction. CapitalSpring was represented by Katten Muchin Rosenman LLP. – Source: NRN.
Steak ‘N Shake is Planning its First Chicago Restaurant
Steak ‘n Shake, the fast-food chain many University of Illinois transplants are familiar with from their days in Champaign, is planning to open its first Chicago location. While the Indianapolis-based chain has restaurants in the surrounding suburbs, it hasn’t opened within the city’s limits. An opening timeframe hasn’t been shared, but Steak ‘n Shake is interested in the former Jamba Juice space at 1322 S. Halsted Street. The chain has more than 540 locations across 31 states and was founded 83 years ago in downstate Normal. The insides feature a retro diner design and the burgers are smashed and fried on a griddle. The restaurant’s motto is “famous for steakburgers.” The patties are fresh, but the blend isn’t ground on site. The sandwiches are served on plates for dine-in customers, and typically there’s a drive-thru component. The University Village location does not have room for a drive-thru. Famed film critic Roger Ebert was among the chain’s fans. The esteemed writer fell in love with the burgers while a U. of I. student. Alderman (11th Ward) Patrick Thompson made the announcement via Facebook. His office said the alderman will meet with Steak ‘n Shake officials in the coming weeks to better figure out an opening timeframe. Chicago first noted Thompson’s post. – Source: Eater Chicago.
Dunkin’ Donuts US Names Scott Murphy COO
Dunkin’ Brands Group Inc. has promoted Scott Murphy to chief operating officer of Dunkin’ Donuts U.S., the parent company said Monday. Previously, he was senior vice president of operations for the U.S. and Canada. Murphy will continue to report to Dunkin’ Donuts U.S. president David Hoffmann. The Canton, Mass.-based company has also moved responsibility for restaurant development and construction to Hoffman’s operations team and created a new position, senior vice president of operations and development, for Dunkin’ Donuts U.S. Rick Colón has been named to the position. Colón is a veteran of McDonald’s Corp., most recently serving as South Zone president, with responsibility for 4,000 restaurants. “Scott and Rick are innovative, inspirational leaders who understand every aspect of the restaurant industry, including most importantly driving operational excellence, people development and franchisee profitability,” Hoffmann said in a statement. “Each has a unique blend of store operations and general management experience, and both are eminently qualified to help us capitalize on our tremendous growth opportunities. I am confident that in their new roles they will enable us to continue to better support our franchisees, better serve our guests and accelerate the development of Dunkin’ Donuts restaurants as we push to become the country’s leading beverage-led, on-the-go brand.” As of the end of 2016, Dunkin’ Donuts had 8,828 locations in the U.S., all franchised, an increase of about 400 units from the previous year, according to NRN’s Top 100 report. In its announcement of Murphy’s promotion, Dunkin’ Brands said it aims to reach 18,000 units nationwide. By comparison, Starbucks had 13,172 domestic locations at the end of 2016. – Source: NRN.
Ruby Tuesday Names Turnaround Expert New CEO
Ruby Tuesday is eager to get its turnaround started. Just a few weeks after naming Aziz Hashim interim CEO of the struggling casual dining chain, the brand handed Ray Blanchette the permanent tag Tuesday. Announced during the ICR Conference in Orlando, Florida, Ruby Tuesday said Blanchette’s history of revitalizing fledging brands makes him an ideal fit for this role. The Maryville, Tennessee-based brand was taken private December 21 in a deal with NRD Capital valued at $2.40 per share. The acquisition was first announced October 16 after a lengthy “strategic review” process. The $146 million purchase ($335 million if you include debt) was NRD Capital’s largest to date and resulted in founder Hashim taking the CEO reins from Jim Hyatt. The former Domino’s, Checker’s, and Popeyes franchisee started NRD in 2014 and has also taken stakes in Fuzzy’s Taco Shop and Frisch’s. “Ruby Tuesday is an iconic American brand with dedicated employees who deserve the best possible leadership” Hashim said in a statement. “As the NRD team conducted its search for a permanent CEO, we sought out an executive with a proven track record of successful restaurant management, combined with innovative thinking, extraordinary team-building skills and a shared philosophy on the importance of strong unit level performance. Ray Blanchette checks all those boxes, and on behalf of everyone at NRD, I want to be the first to welcome Ray to the Ruby Tuesday team. We look forward to a bright future working together.” Blanchette is taking over as CEO immediately, the company told CNBC, and he’ll have his work cut out for him. Ruby Tuesday has closed more than 100 restaurants since August and posted a net loss for nine consecutive quarters, as well as revenue declines, year-over-year, for the past five years. For the past fiscal year, total revenue was down 12.8 percent to $952 million. Same-store sales dropped 1.6 percent in the fourth quarter compared to 3.7 percent in Q4 2016. They declined 3.1 percent for the year compared to 1.4 percent. As of December 1, there were 596 Ruby Tuesday restaurants in 41 states, 14 foreign countries, and Guam. Of those, 541 are company operated and 55 franchised.
Blanchette helped revitalized Joe’s Crab Shack during an eight-year run as CEO, including taking parent company Ignite Restaurant Group public in 2012. During his tenure, he also developed the Brick House Tap & Tavern concept, and oversaw the rebranding of the company from Joe’s Crab Shack to Ignite Restaurant Group. He was replaced as CEO of Ignite by Bob Merritt in 2015. Stephanie Medley, who has worked with TGI Friday’s and KFC, is also coming on as chief strategy officer. “I believe in the Ruby Tuesday brand and its potential for a turnaround story,” Blanchette said in a statement. “Having spent my career in the casual dining segment, I understand how difficult it’s become for brands to differentiate themselves amongst the competition. Like NRD, I don’t believe that is the case with Ruby Tuesday, and with the right product offerings, messaging and execution, the Company can once again be top-of-mind with global diners. I want to thank Aziz and the team at NRD for this fantastic opportunity, and look forward to getting people excited about Ruby Tuesday.” Blanchette started at Carlson Restaurants, then parent company of TGI Fridays, as a manager-in-training in the late 1980s. He held roles as vice president of USA Franchise Operations, vice president of operations for the company’s East Division, and executive director of its International Division serving Europe, Africa, and the Middle East. He left to become president and chief operating officer of Pick Up Stix, Inc. before joining Au Bon Pain in June 2016. “This is kind of a homecoming for me. I’m excited to now lead a brand that I’ve competed with for decades,” Blanchette told CNBC. As for how Blanchette plans to bring Ruby Tuesday back, he said he plans to innovate the chain’s menu while staying true to its core. He doesn’t, however, just want to shrink it, like many casual brands have done in recent months. He also told CNBC technology and third-party delivery won’t be major drivers as Ruby Tuesday looks to solidify its four-walls experience. In the past, Ruby Tuesday has spoken of a “Plan to Win” strategy meant to revitalize sales. Source: FSR Magazine.
Jody Macedonio Named COO of Dean Foods Co.
Ms. Macedonio joins Dean Foods from Henkel AG, where she was most recently senior vice-president of finance for the North America Laundry and Beauty divisions. Before Henkel acquired Sun Products Corp., she was treasurer and senior vice-president of finance and planning for Sun Products. Prior to that, Ms. Macedonio held several roles at PepsiCo, Inc., including c.f.o. and vice-president of finance for the North Business Unit of Frito-Lay. Before PepsiCo, she held finance positions at Nestle S.A., SmithKline Beecham and Chemical Bank. “We are very excited to have an executive of Jody’s caliber join our management team,” said Ralph Scozzafava, chief executive officer of Dean Foods. “With deep financial and operating experience in food and consumer packaged goods — including proven success in driving significant financial improvement and sustainable business performance — Jody will contribute immediately to Dean Foods. Her expertise will be instrumental in our continued focus on winning in private label, building and buying strong brands, and driving our cost productivity agenda.” Ms. Macedonio succeeds Chris Bellairs, who left Dean Foods last August. She will take the reins from Scott Vopni, senior vice-president and chief accounting officer, who was named interim c.f.o. while the company searched for a replacement. – Source: FoodBusinessNews.
Blaze Pizza Names Mandy Shaw CFO
Blaze Pizza LLC has hired Mandy Shaw, left, as chief financial officer, the company said Wednesday, along with announcing four other executive changes. Shaw joins the Pasadena, Calif.-based fast-casual pizza chain after most recently serving as CFO at Tampa, Fla.-based Bloomin’ Brands Inc., parent to the Outback Steakhouse, Bonefish Grill, Fleming’s and Carrabba’s Italian Grill chains. Jim Mizes, president and CEO of the Blaze Fast-Fire’d Pizza brand since May, said Shaw’s background in international development fits the company well as it looks to open more units outside the U.S. Blaze Pizza has seven restaurants in Canada and plans to open new units in Bahrain, Kuwait and Saudi Arabia over the next 90 days in a development deal with M.H. Alshaya Co. Shaw said in an interview at the ICR Conference in Orlando, Fla., that she found the culture and the brand of Blaze Pizza attractive. “The involvement of the chef and the quality are attractive,” Shaw said. “It’s also the team behind it. The founders are still involved and I’m a huge fan.” Shaw succeeds Allen Arroyo, who left the CFO position in December. In addition to Shaw’s appointment, Blaze Pizza said it had promoted Carolyne Canady to the new role of president for international. Canady previously served as the company’s chief development officer. In addition, Blaze said it had made three hires: ·Julie Price was named vice president of franchise sales. She most recently worked with Dunkin’ Brands Group Inc., including the Dunkin’ Donuts and Baskin-Robbins brands, and led business development at Pinkberry. ·Vafa Mansouri was named director of food safety and quality assurance. Mansouri has worked in food safety for Shake Shack and Yum! Brands Inc.’s international division. ·Garrett Snyder was named director of real estate to support domestic franchisees in site selection. Snyder recently was director of real estate for Nekter Juice. Blaze Pizza is privately held, and last July drew an investment from the Los Angeles-based Brentwood Associates private-equity group. The brand has 240 restaurants in 35 states and Canada. – Source: NRN.
Brinker Appoints Wade Allen New SVP and Chief Digital Officer
Brinker International, Inc. announced that Wade Allen has been named senior vice president and chief digital officer of the company, effective immediately. Allen will transition from David Doyle, former Brinker chief information officer, who will retire after more than 23 years with the company. This change marks a conscious effort to leverage synergies with the ever-changing technologies and consumer behaviors and evolve Brinker’s information technology organization into a digital-first team. In his role as chief digital officer, Allen will lead the creation of a seamless, efficient end-to-end digital experience from Team Member to Guest. “We are fortunate to reach within Brinker’s talented senior leadership team time and time again,” says Wyman Roberts, chief executive officer and president, Brinker. “Wade’s deep knowledge of our strategic initiatives coupled with his industry expertise made it an easy decision for him to lead the evolution of our digital efforts.” Allen joined the Brinker family in 2014 as Vice President of Digital Guest Experience leading Chili’s to be recognized as the technology leader in the casual dining restaurant industry today. Before Brinker, Allen served as president of Coupon Factory, a wholly-owned subsidiary of Rockfish Interactive, where he was responsible for the company’s overall strategy and retail digital shopper marketing initiatives as well as new business growth and product ideation. Brinker International, Inc. is one of the world’s leading casual dining restaurant companies. Founded in 1975 and based in Dallas, Texas, as of the fiscal first quarter ended Sept. 27, 2017, Brinker owned, operated or franchised 1,682 restaurants under the names Chili’s Grill & Bar (1,630 restaurants) and Maggiano’s Little Italy (52 restaurants). – Source: FSR Magazine.
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