Yum China Opens First Taco Bell in Shanghai
Yum China Holdings Inc. and Taco Bell Corp. on Monday officially opened the first China unit of the Mexican-inspired brand in Shanghai. The restaurant debuted near Shanghai’s landmark Oriental Pearl Tower in the Lujiazui area, the city’s central business district. “Leveraging our deep insights into Chinese consumer preferences, developed from close to 30 years operating in this market, we thoroughly researched and fine-tuned the Taco Bell menu for China,” said Micky Pant, Yum China CEO, said in a statement. “And the initial response from customers is very encouraging.” The menu features the brand’s favorites that have been adapted to local tastes, including a shrimp and avocado burrito, a Crunch Taco Supreme with nacho cheese sauce and a Volcano Chicken Burrito with Sriracha sauce. “Taco Bell is an innovative brand with a strong heritage that we believe will resonate well with Chinese millennials,” Pant said. Taco Bell has more than 7,000 restaurants, with more than 300 units in 26 countries outside the United States. Yum China Holdings, with executive offices in Shanghai, licenses other Yum! Brands concepts in mainland China, including KFC and Pizza Hut. It owns more than 7,300 restaurants, including the Little Sheep and East Dawning concepts. – Source: Yum China/NRN.
Restaurant Industry Breaks Streak of 10 Straight Negative Months
The restaurant industry kicked off 2017 in a much more uplifting fashion than it ended 2016. While same-store sales growth was flat (zero percent) in January, it represented a welcome break from the 10 consecutive months of negative sales growth experienced by the industry through the end of last year. January’s jump of 4.3 percentage points was the biggest month-to-month improvement in same-store sales growth in almost four years. This insight comes from data reported by TDn2K through The Restaurant Industry Snapshot, based on weekly sales from nearly 26,000 restaurant units and 130-plus brands, representing $65 billion dollars in annual revenue. “Although positive sales growth is always welcome, we have to be cautious about getting too optimistic about these latest results,” says Victor Fernandez, executive director of insights and knowledge for TDn2K. “On one hand, it is common to see some large swings in comp sales during the winter, as significant weather events create fluctuating year-over-year comparisons. For example, sales were up between 20 and 65 percent in three of the regions on the East coast during the third week of the month, clearly weather related.” “In addition to weather, there were unusual events in January that likely had some impact on restaurant sales. The year started with a federal holiday on January 2, which was unlike 2016. We also witnessed the effect of the presidential inauguration and the massive marches the following days. The combined impact is difficult to gauge, but operators will closely watch performance in upcoming weeks to get a sense if the downward trend in sales has been reversed or was simply obscured in all the noise.” Segment Performance: Three segments experienced positive sales growth in January: upscale casual, family dining and quick service. Quick service has been consistently in the top spot, but had slipped the past two months and rebounded in January. January sales declined in fine dining and fast casual. For the first time in over five years, fast casual was the weakest performing segment based on sales growth. Also noteworthy is the fact that casual dining was able to achieve flat results in January, breaking a streak of thirteen consecutive months of negative same-store sales growth. Consumer Spending and Millennial Impact: Growth slowed in the final quarter of the year, but the overall number was misleading,” says Joel Naroff, president of Naroff Economic Advisors and TDn2K economist. “Consumer spending was quite solid and demand for domestic goods was strong. Incomes, including wages and salaries, grew at a solid pace and the gains accelerated in the second half of the year. With the labor market continuing to tighten, that trend should continue this year. That bodes well for consumer spending, which could be even stronger in 2017. Millennials are moving into their 30s and that means they should start forming households and having families. While they have greatly altered restaurant demand already, their aging could lead to another round of changes. Though any new trends that may emerge may be a few years off, it needs to be tracked starting now.” Traffic and Average Guest Checks: Same-store traffic dropped by -2.5 percent in January. Although still negative, this was the best month for the industry since last May. Average guest checks grew by 2.4 percent during the first month of the year. On average, guest checks have grown at a pace of 2.3 percent year-over-year since August 2016. Two-Year Growth Comparisons: A two-year view of sales performance offers another perspective of the slowdown in sales and reveals January’s sales growth to have been relatively weak. Same-store sales fell by about -0.8 percent compared with January of 2015. Two-year sales growth rates have been negative for all months since October of 2016. In contrast, same-store sales calculated on a two-year basis grew by an average 2.5 percent during the first six months of 2016 and by an average 3.0 percent for all months of 2015. Restaurant Turnover: Restaurant industry woes continue to extend beyond the declining sales and into the increasingly difficult task of keeping restaurants staffed. According to TDn2K’s People Report, in December restaurants once again suffered an increase in their hourly employee and restaurant manager turnover. Turnover rates for managers and hourly employees started increasing in 2010. Currently those rates are at the highest levels reported in over ten years. Turnover is clearly correlated to the overall unemployment rate, which means that, at close to full employment, continued employment pressures are expected through the year. Terminated Managers Remain In the Industry: A recent survey by People Report revealed that 62 percent of responding restaurant companies estimate that over half of their terminated managers leave to go work for another restaurant company. “Right now, there are many vacancies appearing every day for restaurant managers, and they are mostly getting filled by people leaving their current restaurant jobs,” says Fernandez. “Many restaurant managers are not finding what they are looking for in their current jobs and are very willing to go look for it at another restaurant company.” – Source: FSRMagazine.
McDonald’s China Operations to Be Sold to Locally Led Consortium
McDonald’s said that it would sell its businesses in mainland China and Hong Kong for $2.08 billion to Citic, a state-owned conglomerate, and the Carlyle Group, a private equity firm. The deal gives Citic and Carlyle franchise rights for 20 years. Citic and its investment arm, Citic Capital, will have a controlling stake of 52 percent, while Carlyle will take 28 percent. McDonald’s will retain the remaining fifth of the company. “China and Hong Kong represent an enormous growth opportunity for McDonald’s,” Steve Easterbrook, McDonald’s chief executive, said in a news release. “This new partnership will combine one of the world’s most powerful brands and our unparalleled quality standards with partners who have an unmatched understanding of the local markets.” Mr. Easterbrook, who took over in 2015 and set about turning the company around, has seen it regain its financial footing recently, although growth has slowed. The turnaround plan announced involved making 95 percent of its restaurants franchises, including more than 1,750 in China and Hong Kong. McDonald’s operates and franchises more than 2,400 restaurants in mainland China and more than 240 in Hong Kong. McDonald’s opted for a franchise deal to save on investing and modernizing stores itself, according to Ben Cavender, a senior analyst at China Market Research, a consultancy based in Shanghai. – The New York Times.
Buffalo Wild Wings will Test Restructuring with Sale of about 60 Company-Owned Outlets
Buffalo Wild Wings Inc. executives said they would sell a portion of its company-owned restaurants, a step sought by an activist investor, as part of a broader response to a leveling of growth. The news came as the company reported that its fourth-quarter profit fell 38 percent, well below expectations, due to a decline in sales at comparable restaurants and a sharp jump in the cost of chicken wings, the main item on the chain’s menu. In discussing the results with investors and analysts on a conference call, executives announced they are exploring the sale of about 10 percent of the chain’s 631 company-owned restaurants to franchisees. They have identified another 10 percent for steps to improve their financial performance. Activist investor Mick McGuire, principal at Marcato Capital Investment in San Francisco, since taking a stake in the firm last summer has pressured executives to sell most of its company-owned restaurants to franchisees. Executives aren’t going as far as McGuire has urged, but they said they see the initial sale as an experiment that may be expanded. “This is a dynamic process,” Sally Smith, the company’s chief executive, said on the call. She added executives still believe the company can reach a goal of a 20 percent operating margin by 2020, up from 15.6 percent on a restaurant level in the latest period, and that they need to arrest a decline in sales at comparable restaurants, or those open at least a year. “If we don’t see same-store sales rebounding, and can’t effectively work toward the 20 percent margin, we will look at other alternatives,” Smith said. The company said Tuesday it earned $15.6 million, or 87 cents a share, during the last three months of 2016. Analysts expected a profit of $1.27 a share. Revenue rose about 1 percent to $494.2 million. But comparable sales fell 4 percent in company-owned units and 3.9 percent in franchised units. Costs of traditional chicken wings rose to $1.99 a pound in the quarter, up 10 percent from $1.81 a year ago. Executives said they expect that price inflation to slow in 2017 to around 3.5 percent to 4.5 percent. They forecast comparable sales to rise 1 percent to 2 percent this year. The Golden Valley-based company was one of the fastest-growing restaurant chains in the country over the last decade with an all-ages concept revolving around wings, sandwiches and sports. But that growth started to level off last year and, like other fast-casual chains, Buffalo Wild Wings felt pressure as takeout food and value pricing rose in appeal with consumers. Then in July, McGuire took a sizable stake in the firm and he launched a series of statements urging the company to shift from its 50-50 split of company- and franchisee-owned units to a mix in which franchisees owned 90 percent of the restaurants. Such a move would substantially reduce the company’s real estate holdings and expenses, McGuire argued. McGuire proposed a slate of four new directors to join the company’s nine-person board, including himself. In the call with analysts, Alexander Ware, the company’s chief financial officer, said executives and external advisers in recent weeks studied a variety of restaurant portfolio options, including the 90 percent franchisee model sought by McGuire. For that option to create value, Ware said the company would, among other things, have to sell about 500 restaurants at higher multiples than were realistic, cut expenses below those of similarly-sized restaurant chains and buy back shares below fair value. Instead, Ware said Buffalo Wild Wings will test the effect of selling off a portion of its company-owned units, chiefly those that are single units in markets. He called the move “pragmatic” and said it is “based on specific goals and initiatives that we control and yet supports an openness to exploring the market and determining how value may best be built over time.” Even as it begins the sale of some of its company-owned locations, Buffalo Wild Wings will continue to expand its 1,200-unit chain this year. Executives said they expect to start 15 new company-owned restaurants in the U.S., 15 franchised locations in the U.S., and 20 franchised locations outside the U.S. The company also said it would expand its R Taco chain with two company-owned restaurants and 12 to 15 franchised locations this year. – Source: Star Tribune, Minnesota/St. Paul, MN.
McDonald’s Giving New Look to Aging Local Restaurants
The signature red trapezoid roof is disappearing from most Central Florida McDonald’s restaurants. Orlando-area McDonald’s are undergoing an aggressive revamp to modernize the region’s 195 fast-food restaurants. Many locations are getting touch-screen kiosks, double drive-through lanes and a modern exterior that trades the traditional red roof for a boxier building in shades of tan and gray. “We’ve been making a lot of changes over the last few years; it is being accelerated now,” said Karen Garcia, vice president of McDonald’s for Florida. The world’s largest fast-food chain has been struggling in recent years globally with increased competition and an influx of fast-casual restaurants. In turn, McDonald’s has countered with initiatives such as the “Create Your Taste” menu where cooks will make a custom burger. All-day breakfast service was an initial hit, but interest in that has slowed over time. McDonald’s has also switched to using real butter on breakfast items and changing their salads. So far 86, Central Florida restaurants have received the new treatment, with another 17 scheduled for 2017. Inside the restaurants, McDonald’s and its franchisees are pairing the touch-screen order kiosks with table service, having employees bring food to the customers. It’s a similar strategy employed in fast-casual restaurants. “Our customers are noticing the table service,” Garcia said. “They really don’t expect that.” Officially, the company is calling the interior changes the “experience of the future.” “It’s a much more modern look, and it’s really invigorated the restaurants,” said Mike Yontz, a franchisee of three McDonald’s restaurants in Orlando. McDonald’s is also testing other technologies, such as using third-party delivery services such as UberEats. McDonald’s launched that service last week. It is also exploring a mobile-ordering smartphone app, Garcia said; some Orange County residents have received flyers promoting one. Starbucks and Chick-fil-A have their own mobile apps that allow customers to place an order from their phone, pay and pick up a ready-made meal. The remodels have caused quite a bit of dust, but most restaurants have stayed open in some capacity throughout, Yontz said. The touch-screen kiosks have already been in use for months at a handful of restaurants, such as the “World’s Largest Entertainment” McDonald’s at International Drive and Sand Lake Road. Yontz said the kiosks allow the restaurant to add an employee to the lobby area to help with ordering and deliver meals to tables. McDonald’s has about 870 restaurants in Florida, and when completed, about 600 will have the “experience of the future” services, Garcia said. – Source: The Orlando Sentinel.
Chicago Black Restaurant Week Offers Discounts at Black-Owned Restaurants
Chicago Black Restaurant Week, returning for its second year, starts February. 12. The event, which celebrates black-owned restaurants, has grown since last year, with more participating restaurants offering discounts and the launch of a “young foodie” scholarship drive designed to help one or possibly two recipients get a culinary education or launch a culinary business. As of now, 23 restaurants and food trucks in Chicago and surrounding communities have signed on to be part of CBRW, up from 17 in 2016, said Lauran Smith, a social media specialist who founded the event. Participating restaurants will offer discounts to customers from Sunday, Feb. 12, to Sunday, Feb. 19. Unlike the Chicago Restaurant Week organized by Choose Chicago, which locks restaurants into offering a three-course lunch for $22 or a three- or four-course dinner for $33 or $44, Chicago Black Restaurant Week allows each restaurant owner to offer any discount he or she likes. (Call ahead to ask.) Among the restaurants participating this year are The Crazy Crab Chicago, Harolds’s Chicken of Homewood, Nadia’ s Gourmet Grapes and Peach’s on 47th. Smith chose to launch the event during a week in February last year to honor Negro History Week, which was a precursor to Black History Month. She said there are a lot of black-owned restaurants people don’t know about — even her. She got the idea for a Chicago Black Restaurant Week when she learned of a restaurant that was black-owned and she was upset not to have known that. “I want to honor (black-owned restaurants) and give them the spotlight,” she said. “There are so many businesses with good food.” – Source: The Chicago Tribune.
Noodles & Company Looks to Franchising for the Future
Noodles & Company, struggling with financial losses and hit with a data breach last year, is putting much of its future into franchising. The Denver-based fast-casual operator has contracted with the investment banking firm Cypress Group to sell company-owned restaurants to franchisees. Noodles & Company suggested that franchising would play a bigger role in development in the coming years. “We’re over 85-percent company owned,” Noodles & Company interim CEO Dave Boennighausen said on a conference calL. “We expect franchise restaurants will occupy a larger proportion of our restaurant portfolio.” As of Sept. 27, Noodles & Company operated 455 locations and franchised 73 units. The comments come as Noodles & Company plans to close 55 underperforming locations in the first half of the year. The operator is also slowing unit development, with plans to open 12 to 15 company-owned restaurants, mostly early in the year. That’s a substantial reduction from past years. In the first three months of 2016, Noodles & Company opened 34 company-owned units. The locations the company plans to build this year will be in “lower-risk markets with strong brand awareness and proven success,” Boennighausen said. Executives suggested that closing the underperforming restaurants would go a long way on their own toward righting Noodles & Company’s financial ship. The closed restaurants have average unit volumes of $700,000, while a typical Noodles & Company location generates just under $1.1 million. Low-unit-volume locations lose money, with 20-percent loss margins. Without those restaurants, its restaurant contribution margin of 11.5 percent to 12 percent would be 280 basis points higher, the company said. The locations to be closed are in newer markets, where the brand isn’t as well known. “Many of the restaurants were opened recently in newer markets, where brand awareness is not strong and staffing is challenging,” Boennighausen said. The locations slated to close represent more than 10 percent of Noodles & Company’s 528 units. Still, such a plan is not unusual. Several restaurant chains in recent years have closed locations, often aggressively, in a bid to reset business and offset weak sales. Such closures often yield strong results. In 2013, Qdoba Mexican Eats announced plans to close 67 company-owned restaurants, more than 10 percent of that burrito chain. Same-store sales have been generally strong in the years since. In addition to the 55 closures, this week Noodles & Company sold preferred shares and the rights to buy more stock at a set price to existing shareholder L Catterton, raising $18.5 million in the process. L Catterton now owns nearly 35 percent of Noodles & Company stock, according to SEC filings. The funds will be used toward costs associated with the closures, expected to cost Noodles & Company $24 million to $29 million in cash in order to pay off broken leases, broker fees and other costs. In addition, a data breach last year is expected to cost the company $11 million. The stock sale doesn’t come close to raising that kind of cash. And so the company also announced that it plans to hold a secondary stock offering in the hopes of raising $32 million. The moves come as Noodles & Company reels from persistently weak same-store sales and increasingly deep financial losses. As part of its strategic plan announced Thursday, the company renegotiated a credit deal with its lenders to give it financial flexibility by easing some financial covenants that are part of its lending deal. In the first three quarters of 2016, Noodles & Company lost $26.3 million, down from losses of $9.5 million in the same period in 2015. Same-store sales had fallen in each of the past six quarters, including a 1.3-percent decline in the fourth quarter. Noodles & Company’s strategy to improve sales involves menu simplification and a focus on core menu items. The company has streamlined the menu from 28 items to 19, and eliminated its sandwich line. Menu reductions are aimed at speeding and improving service while saving on food and labor costs. Boennighausen said on the call that Noodles & Company showed “significant improvement” in guest satisfaction scores in the fourth quarter, which he called a leading indicator. Noodles & Company is planning to test in Colorado and Kansas City several initiatives involving food quality, menu, operations and service. The company is developing a loyalty program and is working to improve online ordering. The company is also testing “guest bussing,” which could reduce labor and increase store cleanliness. “These initiatives can and will have significant impact on several facets of the business,” Boennighausen said. “I’m as confident as ever in the future of Noodles.” – Source: NRN.
Puzder to Divest his CKE Restaurants Stake
CKE Restaurants Inc. CEO Andy Puzder vowed to divest his interest in the company he’s run for the past 17 years, as part of his bid to become the next secretary of labor under President Trump. A spokesman for Puzder said in a statement that the executive “is working to divest assets” and said that doing so is “a complex process” because the owner of Hardee’s and Carl’s Jr. is a private company. Puzder vowed Thursday that he is “fully committed” to be the labor secretary, amid heavy criticism from labor groups and some Democrats over his nomination. “I am fully committed to becoming Secretary of Labor and I am looking forward to my hearing,” Puzder said in a recent statement. Puzder was nominated for the post in January, but his hearing in front of the Senate Health, Education, Labor and Pensions has been delayed — reportedly because he has yet to file paperwork with the Office of Government Ethics. The office requires cabinet appointees to divest their interest in potential conflicts of interest, either through a sale or by putting that interest in a blind trust. His departure from CKE would end a remarkably long tenure with the company and made Puzder one of the most well-known and highly respected executives in the restaurant industry. Puzder has been involved in the quick-service chain operator in some fashion for the past 26 years. He was named president and CEO of CKE Restaurants in September 2000. Puzder has been a vocal opponent of higher minimum wages and an expansion of overtime pay, as well as the Affordable Care Act. He was an early backer of Donald Trump’s presidential candidacy and was quickly speculated as a potential labor secretary shortly after Trump’s election. The restaurant industry has largely cheered his nomination. The restaurant industry is a huge employer, and has been critical of various moves in recent years to increase worker pay. It views Puzder as a champion of its causes, and believes the executive would ease the regulatory burden on restaurant companies. But those stances have also made Puzder a lightning rod for labor activists, who view the executive as an opponent to their cause at a time when they’ve been pushing restaurants to raise pay and become friendlier to unions. Earlier this week, coalitions representing conservative groups and labor activists sent dueling letters over Puzder’s nomination. “For the past eight years, the Labor Department has overwhelmed job creators with burdensome regulations, creating immense uncertainty for employers,” conservative groups backing the nomination wrote. “This has led to subpar economic recovery, including gross domestic product growth that has averaged less than 2 percent under President Obama.” Labor activists, on the other hand, argue that Puzder’s own company was cited frequently for failing to pay minimum wage or overtime. “Puzder’s confirmation would ensure that the interests of the fast food industry — and its large meat and food industry suppliers — would prevail over the needs of hard working people in the food system,” the group wrote. – Source: NRN.
Ecolab Closes on Purchase of Anios
Ecolab Inc. announced that it has closed on its previously announced acquisition of Laboratoires Anios. Based in Lille, France, Anios is a leading hygiene and disinfection products manufacturer primarily for the healthcare market. 2016 sales of the acquired business were approximately €228 million ($245 million). The total transaction consideration, including satisfaction of outstanding debt, was approximately €750 million ($800 million). A trusted partner at more than one million customer locations, Ecolab (ECL) is the global leader in water, hygiene and energy technologies and services that protect people and vital resources. With 2015 sales of $13.5 billion and 47,000 associates, Ecolab delivers comprehensive solutions and on-site service to promote safe food, maintain clean environments, optimize water and energy use and improve operational efficiencies for customers in the food, healthcare, energy, hospitality and industrial markets in more than 170 countries around the world. – Source: Ecolab Inc.
Fiesta Restaurant Group, Inc. Confirms Receipt of Director Nominations Notice
Fiesta Restaurant Group, Inc., parent company of the Pollo Tropical® and Taco Cabana® fast casual restaurant brands, confirmed that it has received a notice from JCP Investment Partnership, LP that JCP intends to nominate three candidates to stand for election to the Board of Directors” at the Company’s 2017 Annual Meeting of Stockholders. Fiesta’s Board and management team are committed to acting in the best interests of all Company stockholders and welcome their views in order to pursue a common goal of maximizing long-term stockholder value. The Board will review the nomination notice of JCP and will present its recommendations to stockholders in its proxy statement with respect to the 2017 Annual Meeting to be filed with the Securities and Exchange Commission, which will be mailed to all stockholders eligible to vote at the 2017 Annual Meeting. Stockholders are not required to take any action at this time. – Source: Fiesta Restaurant Group, Inc.
FCPT Announces Acquisition of Two McAlister’s Deli Restaurant Properties for $4.1 Million
Four Corners Property Trust is pleased to announce the acquisition of two McAlister’s Deli properties for $4.1 million. Both properties are located in Texas and are occupied under a new triple-net master lease with 15-year term. The transaction was priced at a going-in cash cap rate of 6.75%, exclusive of transaction costs. The tenant is one of the largest McAlister’s Deli franchisees with a strong track record within the system. The restaurants are above average performers for the brand and well located in their respective communities. – Source: Four Corners Property Trust.
Modern French-Inspired McDonald’s Arrives in New York
Now, the fries aren’t the only French thing on the menu. A modern McDonald’s concept has arrived in New York via Europe, and it’s giving the Golden Arches a sexy polish. The restaurant is the first of its kind in the US, and features several new foods with a Parisian twist: croissants, chocolatines and raspberry pastries. Inside the Chelsea fast food joint (809 6th Avenue), the look, designed by France’s Patrick Norguet, is missing the mustard yellow and ketchup red the iconic chain is know for. Instead, the style is metallic, open and simple. There is a wall lined with self-service touch screens for choosing grub, but less adventurous customers can still order from a traditional salesperson at the counter. There’s even a kindly “concierge” to greet flummoxed Big Mac fans at the door. On Wednesday afternoon, the restaurant was occupied by about 20 patrons. And McDonald’s customers who had discovered the brand new location were saying “Ooh, La La!” “It’s beautiful,” said Barış Can Bahtiyaroğulları, a 24-year-old student. “I will be back, of course. My school is close to here, so this is the best place to come at break time.” However, while the restaurant is French-inspired, escargots, foie gras and creme brulee are, thankfully, not on offer. – Source: The New York Post.
Panera Vet Joins Papa John’s
Mike Nettles has been named senior vice-president, chief information and digital officer for Papa John’s International. In his new role Mr. Nettles will be tasked with enhancing Papa John’s digital technology to deliver an improved customer experience, the company said. Before joining Papa John’s, Mr. Nettles was vice-president of enterprise architecture and I.T. strategy at Panera Bread Co., where he was responsible for driving information technology architecture and processes for the Panera 2.0 business model. He also led the technical design, development and implementation of digital and in-café Panera assets. Prior to Panera, Mr. Nettles was chief technology officer at DiningIn Inc., an on-line food delivery service. He also held positions with Brinker International, Torex, NeoStar Retail Group and was the founder and principal of Red Chair Ventures L.L.C. “We are excited to welcome Mike Nettles to the Papa John’s team,” said Steve Ritchie, president and chief executive officer of Papa John’s. “Not only is Mike a great cultural fit for our company, but he is also a proven leader in the digital and retail sectors that will help us deliver a better customer experience and elevate our digital platforms.” – Source: Food Business News.
TGI Fridays Taps Taco Bell’s Doritos Locos Tacos co-Creator as Chief Marketing Officer
TGI Fridays is shaking things up. The restaurant said Tuesday that it has hired a new chief marketing officer, Taco Bell’s Stephanie Perdue, and tapped restaurateur Jerry Comstock as its president and chief operating officer. Perdue, the former chief product marketing officer for the innovative Mexican-style restaurant chain, was responsible for leading the team that designed Doritos Locos Tacos, its most successful product ever, and introducing the restaurant’s breakfast menu. “TGI Fridays has a long history of creating firsts in the industry and I look forward to continuing that tradition by breaking the status quo,” Perdue said in a statement. “I am thrilled to help write the next chapter for Fridays as we reimagine the brand for both team members and guests.” Perdue joined Taco Bell in 2004 as a brand manager and rose to vice president of brand marketing and, shortly after, chief product marketing officer. Comstock is the former CEO of Strategic Restaurants Corp., a company that was once among the largest Burger King operators in the U.S. “Jerry is a long-time veteran of the restaurant business, but even more importantly, he knows the Fridays business,” TGI Fridays CEO John Antioco said in a statement. “He spent years fine-tuning best practices for executing a superior guest experience at his restaurants. In addition, he has excellent long-term relationships with Fridays’ franchisees, who now own and operate over 90 percent of our 470 U.S. locations. “Casual dining, including Fridays, needs to be more imaginative and differentiated, especially around product innovation, marketing, and customer engagement,” Antioco said. – Source: CNBC.
The Start of a Fast Casual Sandwich Empire
With a chef-driven menu and a culture rooted in music and freedom, Bunk Sandwiches is ready to leave its mark from coast to coast. What were three indie-rock dudes, who like music and hanging out, doing raising capital to fund a restaurant chain? That’s a question Matt Brown continuously asked himself in those early days of Bunk Sandwiches, a time when the housing market was a crumpled mess and banks were about as generous as that rich uncle you haven’t seen since Christmas. Brown held firm to one notion. While the concept, still in its infancy, was just starting to make a name for itself in Portland, Oregon’s food-crazed community, the trio behind Bunk Sandwiches had zero reservations about its potential. The problem was simply translating that passion into something resembling a solid business model. “We had to grow up a little bit and learn how to ask people for a lot of money,” Brown says. Let’s look ahead a bit. In the next five years, they would essentially open a Bunk a year. Currently, there are five Portland brick-and-mortar units. There was a unit in Williamsburg, Brooklyn, as well, but it recently closed, and the team said it is exploring another Big Apple location. There are also three outposts in the Moda Center—home of the Portland Trailblazers NBA squad—and a “big-ass bar” at Providence Park, where the Portland Timbers, of the MLS, play. In other words, Brown and the Bunk team figured it out. Although Brown admits this process of building a fast casual was new to everyone, it wasn’t erected on shaky ground. It started when Brown, Tommy Habetz, and Nick Wood were working at a fine-dining, New American restaurant. Habetz was the chef, Wood was the sous chef, and Brown was the bar manager. “I quit the restaurant thing first and I was like, ‘Look, I’m done with the pomp and circumstance of a restaurant. I’m over it,’” Brown says. “I want to do things centered around music and simple stuff.” Habetz, an accomplished chef who clocked time at Mario Batali’s Pó and Bobby Flay’s Mesa Grill in New York City, agreed. “He said, ‘Let’s just do sandwiches and we’ll get a bar where you can do shows,” says Brown, who also founded Bladen County Records. The first Bunk, named after William “Bunk” Moreland from the hit HBO show “The Wire,” opened in 2008. In 2010, Bunk Bar on SE Water Ave debuted, officially injecting music into the brand’s DNA. That personality is part of why Bunk has not only been so successful, but why it’s so marketable, says Noah Cable, head of operations. To paint the picture, here’s a fact: The Bunk Bar is one of the top five selling Pabst Blue Ribbon venues in the nation. “That kind of says it all, doesn’t it?” Cable says with a laugh. This image of fast casual as the antithesis to stuffy waiters, code-written menus, and white tablecloths everywhere, couldn’t be truer at Bunk. “On any given day, if you were to tell Matt he has a corporate job he might punch you in the face,” Cable says. But also in the vein of what makes fast casual tick is the food. As you might imagine, a chef with Habetz’s pedigree can make some pretty damn good sandwiches. The Pork Belly Cubano is a thing of legend in Portland. Habetz, who also went on to open Pizza Jerk, a restaurant Bon Appetit listed in its Best New Restaurants 2016 feature, makes an Italian sub Brown calls “the best in the world.” To get to this success point, as Brown touched on earlier, the team had to master the operations side. They hired a business coach and unleashed a funding strategy that doesn’t quite follow the typical playbook. Instead of searching out one major investor, or securing a bank loan (impossible in those days) Bunk set about collecting rain drops of cash until it filled a bucket. They each compiled a list of 10 to 20 people they thought might lend them $5,000, $10,000 or $25,000, promising to pay them back with a little bit of interest over three to five years. Instead of equity, they offered an allowance to eat at Bunk and a chance to play a role in the brand’s development. “That way they can feel like they’re a part of something. They can bring friends in and say, ‘Yeah, I get free food here every month because I loaned these guys some money.’ And it’s really appealing to people,” Brown says. It helped that Bunk was hatching in Portland, a city that historically supports its own. “The local interest in the food market also made it available for a young, broke guy with an idea to succeed. We don’t take that for granted,” Brown says. “… When you’re not a franchise growth model, when you’re independently growing, the No. 1 rule to follow is that you have to have someone on the ground where you want to land.” That’s the blueprint moving forward. Bunk, Brown says, could show up in any major city, from Texas’ stronghold markets to Chicago, as long as the person on the other side is an invested partner. They have to love Bunk and they have to understand the culture. Cable says they’re currently working on a deal to put Bunks in Green Zebra Grocery stores, including one on Portland State University’s campus. This could result in four new stores. No matter who links up with Bunk, they will need to appreciate what the brand stands for. From personal experience, Brown has always wanted Bunk to employ and support creative minds. Notably, they tend to hire a lot of musicians. These people flock to Bunk as well, since Brown has made it clear that he wants people to enjoy being there and to pursue their bigger goals. “If you want to go out on tour for a month no problem. Just get your shifts covered. We’ll give you your job when you get back,” he says. “As far as that growth model goes, for us personally, Bunk is about freedom because it gave us freedom to be able to walk away from restaurants and go into something that we were really happy and comfortable with,” Brown adds. “It will always have an element to us of does this still feel free? Do we still feel like this is an experience of freedom? It’s all dictated by the kinds of people we are.” – Source: QSRmagazine.com.
Fazoli’s Names David Hasler CFO
Fazoli’s, the fast-casual Italian chain, has named David Hasler as chief financial officer, the company announced. Hasler most recently served as senior director of global treasury for Walmart. He succeeds Rodney Lee, who left Lexington, Ky.-based Fazoli’s last summer to become CFO at the Krystal Co. Fazoli’s said Hasler will oversee the company’s accounting, financial planning and analysis, information technology, payroll and legal services departments. In addition to Hasler’s hiring, the company announced other changes to its finance department. Tracy Haskins, a 20-year company veteran, has been promoted to vice president of finance and treasury, and Spencer Houlihan has rejoined Fazoli’s in the new position of vice president for financial planning and analysis. Houlihan returned to the company, where he first began work in 2008, after a year with University of Kentucky Healthcare. “The Fazoli’s brand is very fortunate to be starting off the year with such an impressive team guiding our finance department,” said Carl Howard, Fazoli’s president and CEO, in a statement. “Tracy and Spencer are company veterans who have played an integral part in our success, while David brings a wealth of financial experience and expertise to the CFO role,” Howard said. Fazoli’s is owned by Sentinel Capital Partners, which acquired the chain in July 2015 from Sun Capital Partners. – Source: NRN.
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