Dear Loyal Readers:

I hope you all had a great Thanksgiving. It is hard to believe that the beginning of Winter is still a few weeks away; as, here in Chicago, we have had our first blizzard!! So much for Global Warming. We are now in the push for those great end of year results, and I wish you all well. Another push that is happening in the business world is the number of employees looking to leave their current positions to seek greener pastures. In a recent article I read, in Forbes, authored by Jack Kelly, he listed some signs leaders should look for in employees that maybe looking to move. By knowing the signs, leaders can often interceded and save those employees you want. Sounded good to me so I am passing them along. Hope they help:

* Pay close attention to an employee’s appearance. Usually, an obvious sign is when they start wearing new suits, flattering and stylish outfits, sporting fresh haircuts and other accouterments suggesting that they may be trying to impress someone at an interview. Sometimes it is the opposite of what you’d expect. If a person has become discouraged in their job and feels neglected, their appearance will reflect it. They may start dressing more informally and pay less attention to grooming. These signs—often missed—reflect that the person has stopped caring and is giving up.

·       Is there someone in your group that has demonstrated a pattern of showing up late to work? Have they started to take an unusual amount of sick days? Do they disappear during the day? Could you not find them toward the end of the day? These could be signs that either they are interviewing or have become apathetic toward their job.

·      If the person was a star, but now slow to finish assignments, not meeting deadlines, making stupid mistakes and not caring about their work, then there is a problem. It is especially acute if you bring it up to the person and they don’t seem to care at all. And finally

·      Is the person finding ways to get out of accepting new assignments? Are they coming up with excuses not to schedule certain trips slated for the future? Are they suggesting that their work be given to someone else with dubious reasons? This could indicate that they have something locked up and don’t want to put you in a worse situation by having work not done within the necessary deadlines.

To get a complete list of all the signs OR if this happens to you, my Associates and I will be happy to assist you in finding the best replacements or providing suggestions for keeping the ones you want to keep. While you are looking for the signs, enjoy the latest edition of American Recruiters Global Foodservice News. I guarantee there are No signs of leaving from us.

Craig Wilson

President

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Digital, Delivery Driving Industry-Wide Shifts In Restaurant Real Estate

Moore’s Law was coined in 1965 by Gordon Moore and is often referenced to describe the driving force of technological and social change, productivity and growth. According to Olo founder and CEO Noah Glass, the restaurant industry is, in a way, experiencing this theory as digital ordering and delivery barrel toward an expected $200 billion of sales throughout the next four years. “That’s a bigger share than drive-thru all together and it’s happening in a time period that is 10 times shorter than the history of the drive-thru,” Glass said. “That’s an incredible transition to have a larger chunk in a tenth of the time.”

His company has been on the front of this trajectory since 2005, a rare start-up success story that now includes providing digital ordering and delivery solutions to over half of all public brands, or more than 48,000 restaurants. Glass has as firm a pulse on the dizzying pace of restaurant technology as anyone, which is why he landed on Nation’s Restaurant News’ “The Power List” this year. He said the inflection point for the marriage between technology and restaurants was in 2007 – when Apple introduced the iPhone. “In a matter of a year, everybody was getting a smartphone and using them not just as a media or communication device, but to do a lot of magical stuff, including a remote control for buying things,” Glass said. “The pieces fell into place when Uber came around (2009). It was a big on-demand driver. That’s when restaurants started thinking about an on-demand service model.” Now, restaurants don’t have much of a choice but to think that way. Thanks to the likes of Uber and Amazon, consumers are quickly growing to expect such on-demand convenience, and in the next five years, analysts predict that 25% of all restaurant sales – $200 billion out of the $800 billion industry – will occur through digital channels. According to Glass, once the likes of Uber started changing consumer habits, it was Starbucks and Panera that brought the narrative into the restaurant industry. “Pizza has always had this big idea but Starbucks and Panera were the first to say ‘we’re going to do it, too.’ That’s when we knew that digital ordering had a bigger place in the industry and ever since then it’s been a mad dash,” Glass said.

Delivery expansion: Throughout the past three years, delivery has escalated these expectations. Despite the overall weakness in the U.S. restaurant industry, foodservice delivery posted sizable gains in both visits and sales over the last five years, reports The NPD Group.  The 20% increase in delivery sales and 10% gain in delivery foodservice visits have been supported in large part by the growth of digital ordering.  Morgan Stanley predicts that by 2020, the food delivery industry could account for 11% of all restaurant sales. As digital ordering enables this increase in delivery, Olo is, yet again, on the front lines. In 2017, the company partnered with Amazon to streamline online ordering and enable Olo customers to integrate with Amazon Restaurants. Further, Olo’s Dispatch product connects restaurants with third-party delivery service providers on one platform, while its Rails product enables restaurants to integrate third-party delivery services into their own point-of-sale system even if the order originates through the third-party app. The goal is to enable restaurants to tap into delivery without having to invest in their own in-house delivery fleet. “It’s all about enabling the consumer to get their food and giving customers the same experience whether they’re ordering from the restaurant directly or through the marketplace or through pickup. If a restaurant can execute 10 out of 10 times on timing and quality, it doesn’t matter where a consumer is placing the order,” Glass said. “Our job is to keep it dead simple for restaurants and for consumers.” Simplification remains a big challenge, however, as more restaurant brands add delivery and as delivery aggregates continue to grow.

Despite this growth, and despite Olo’s longevity in the space, Glass said the industry is still in the “super early innings” of both digital ordering and delivery. As digital and delivery continue to grow, expect a major shift in how restaurants approach their real estate footprints. Already, according to NPD Group, nearly 50% of dinners purchased from a restaurant are consumed off-premise. “The most convenient way to get food will win more market share over time and that is what is driving delivery. We’re already not eating in the restaurant as much and I think this is going to have a massive impact on the industry,” Glass said. That impact will include smaller footprints, nontraditional footprints and the emergence of commissary-only locations that focus on delivery and catering orders, similar to what Chick-fil-A is doing in Nashville and Louisville.  Glass adds that Wingstop’s story is a case study on this “new real estate” trend. Wingstop currently pulls in 25% of its revenue from digital orders, CEO Charlie Morrison recently told CNBC that the company has the opportunity to digitize every transaction, especially as it ramps up delivery in 2019. “Wingstop has incredible takeout operations, incredible efficiency with delivery and incredible efficiency from a revenue-per-square-foot perspective,” Glass said. “They don’t have drive-thrus, they just crank out a ton of business out of really small boxes. They’re well positioned for the big industry shift that’s happening. You’ll see more restaurants looking for off-the-beaten-path real estate that can do digital ordering for delivery.” – Source: Forbes.

Firebirds’ Secret to Being the Unchained Chain

One of the challenges of scaling a mid-sized restaurant chain is the notion that, well, you’re a chain. Beyond the power of recognition that crosses state lines, how do you compete with local, independent spots that appeal to the community-based diner? How do you unchain the chain, in other terms, and erase the sterile stereotype of corporate eateries? Perhaps the most compelling tool is local-store marketing, an approach that can ultimately determine if your restaurant chain is just another location in the community, or truly part of the community it serves. At 49-unit Firebirds Wood Fired Grill, Stephen Loftis, the chain’s vice president of marketing, says local-store marketing is where the team “really had to plug in and roll up our sleeves.” “And figure out how to attack 49 very unique markets and really, almost, 20 [designated market areas] where we’ve got to work back through.” What Firebirds, top emerging chin, did was create a robust print and digital local-store marketing reference guide for its operators. The constantly evolving material leads the owner through the complex process from day one, offering references and tips for each step along the way, and much more. Start with the mission Callie Murray, a marketing manager at Firebirds, says the team defined what local-store marketing really meant before putting words to paper. Essentially, it can be very different marketing to Niles, Ohio, than Jacksonville, Florida. And how do you account for that variance and make it feel authentic by zip code? “A lot of that is obviously growing traffic and sales, and then establishing the brand and just creating a local relationship in the community,” Murray says. “Whether that’s with local businesses, our mall partners or center partners that we’re located in. And also just our guests who are already in our restaurant.”

Word-of-mouth marketing is the place to start. Murray suggests looking at the dynamic like this: If your brand establishes a good relationship with one person in the community, the guest is likely to return with another diner, or maybe three or four. The typical average party size at Firebirds is 2.5, with a per person average of $26.50. “So if you’re reaching that one person you’re not only reaching that one person—you’re reaching the person they’ll bring with them and the people they’ll tell and it only grows from there,” Murray says. By the numbers, if you say four people results in 10 total guests (four parties of 2.5 people), it’s an additional $265 in sales. That divided by $10,000 equals a 2.65 percent sales increase. “The impact we view from just speaking to one person and making a great impression on the brand is huge,” Murray adds. At its core, local-store marketing is best defined as driving guest frequency through established relationships. This traffic can arrive via community outreach—inviting locals to dine at your chain. It’s a different approach than mass media spend, like TV, radio, out-of-home advertising (billboards), and deep discounting. Simply, it’s a strategy to sales along a grassroots path. But while the term “grassroots” can sometimes paint a picture of spontaneous and combustible marketing, local-store strategies at the chain-restaurant level need to be specific, measured, planned, coordinated, and executed all year long, Firebirds says. This is how a restaurant becomes a community landmark, not just the “hot spot” worth trying when it first opens. Firebirds’ guide also lays out in-store marketing tips, and what to look for in brand ambassadors who can deliver food samples to the community, whether that’s hotels, businesses, schools, car dealerships, apartments, and so forth. The guide details the types of food items Firebirds would like to make a first impression with, when the best times to do so are, and how brand ambassadors can follow-up promptly with further opportunities. DEREMER STUDIOS LLC. The FIREBAR is one of the iconic features of Firebirds’ design. Store by store. Becky Hall, also a Firebirds marketing manager (Hall and Murray each cover a specific regional footprint), says the brand deploys SWOT analysis and has local teams fill out information on each market to make sure efforts are location specific. They look at the area as a whole around each location. What other businesses are nearby? What’s the competitive intrusion? “We talk about the external,” she says. “The strengths inside the four walls. The opportunities that are within a 4-mile radius. And then threats that are external in a 4-mile radius as well. We have our local teams fill those out because they know the market better than we do, because we’re here at the corporate office in Charlotte. We then use that SWOT analysis on a regular basis to gain insight into the market and learn how to actually market that individual restaurant.” In the chain lexicon, presenting a local feel needs to be approached with a careful hand, however. There’s an entire section in Firebirds’ local-store marketing guide on remaining brand focused. “We want to maintain that brand awareness,” Murray says, “and just make sure it’s all really in line with the polished casual brand that we go for. [The guide] has all of our logos. It explains that [the operator] can get our logos from either Becky or myself since they don’t have access to those necessarily. Mall partners, whoever it might be. If they’re doing a private dining event, or something like that, they come to us.” The guide features a page noting what Firebirds stands for as company, and how that applies to multiple touch points. Everything from verbiage, typography, design, pricing, e-blasts, posters, and more. And this all goes through Murray and Hall.

Additionally, on the note of brand equity, Firebirds includes a section on public relations. It’s a crisis management and media relations protocol outline for local teams. “Everything they need to know in case the media comes calling for whatever reason,” Hall says. “We have these guidelines, and they can give us a call pretty quickly so we can manage the media in case of an emergency or unfortunate situation.” This runs through topics like fires, guest injuries, ill-prepared food, accidents, disputes, criminal acts, poorly behaved employees, and more. Firebirds provides operators contacts and the exact corporate employees to reach in case of crisis, along with some information to gather before reaching out. This way Firebirds can respond collectively, quickly, and effectively. FIREBIRDS WOOD FIRED GRILL. Everything from seasonal menu items to social protocol is covered in Firebirds’ local-store marketing guide. Getting involved. Firebirds sponsors athletic teams, schools, and local events. The chain’s locations have a visible community presence to stay active in each market. Hall and Murray work closely with the local teams to evaluate each opportunity and make sure it’s the right fit for the brand. Firebirds supports Alex’s Lemonade Stand Foundation on a national, system-wide level and has raised over $1.2 million to date. But there are also local efforts, like a recent Charlotte 5K event for the Isabella Santos Foundation. Firebirds had a VIP tent with its chef cooking up food, and helped raise more than $255,000 to fight childhood cancer.

The social media effect. Firebirds curates individual Facebook pages for every location. Christine Lorusso, Firebirds’ digital marketing manager, says the chain’s social efforts allow it to connect with the community and guests on an uber-local level. And it’s a major element to new store openings. One example: Firebirds recent Oklahoma store—a first-to-market entry—started with a Facebook page, which generated fans before the doors even opened. Firebirds can also create ads for local pages and build out its e-club program—the Inner Circle—before grand openings. In this case, Firebirds started its database with more than 1,000 members, Lorusso says, before business got underway—thanks to social media efforts. Once the restaurant does open, though, it allows each location to share those aforementioned community efforts. Using the Oklahoma restaurant as an example again, Firebirds invited all of the local first responders in on 9/11. “They could come and try Firebirds and also we could show our appreciation to them. And we were able to promote that on social media, and share our photography from the event,” Lorusso says. “And really just get plugged into the community where somebody might not know Firebirds that well.” Firebirds also used social for its hiring efforts. Building a Facebook page for an upcoming location is important for search engine optimization and general awareness as well, Lorusso adds. The corporate team handles the postings internally. Hall and Murray will communicate with the local team and Lorusso, who then makes sure all of the social communications are current and relative. Lorusso says Firebirds handles the tasks internally to ensure brand voice uniformity, and so the manager can focus on the business, not on social media. This line of community is critical across the guide’s elements. Operators have learned from the book, and have the information at the ready, and are able recognize an opportunity and then send it back to the corporate team before proceeding. “[Hall, Murray, and Lorusso] spend an inordinate amount of time really providing a point of view back,” Loftis says. “Hey, does this make sense? Does this fit the brand? Are we getting a return here?” “Whether it’s Isabella Santos or something with a local school, or even our national charity, Alex’s Lemonade Stand Foundation, we’re constantly reviewing things and making sure it fits our brand guidelines. And there is quite frankly, a return on investment. Either it’s a cash trade, food, or whatever it might be. There’s a return and it makes sense for the brand.”

Keep it evergreen. Loftis says Firebirds had an informal version of this guide dating back six, seven, eight years, and then formalized it about a year and half ago. Originally it was an online guide, but Firebirds wanted to offer operators something tangible. Murray adds that operators are constantly offering feedback and appreciate the guide’s backbone of support. “They know what’s important. They don’t realize what all goes into it, and all of the different buckets and all the different little things that they really should think of and consider when evaluating opportunities or going out into the community for things,” Murray says. “The book is a very good source for them to refer to whenever they’re looking at events before they even send to Becky and I. Whenever they’re thinking about events or delivering food.” “There are some tools in here—some spreadsheets, tracking mechanisms, etc, that really help them guide their thoughts and help them think strategically about what they’re doing instead of being out there willy nilly and trying to do a little bit of everything,” Loftis adds. Murray says Firebirds is working on a fresh edition. They’ve done a few iterations to keep it updated from a seasonal perspective. For instance, updating a tool kit section that shows different items they can order to take out in the community, whether it be a sales flyer or different seasonal menus. Firebirds hosts quarterly calls with local teams, talking to each restaurant, one by one, to chat about the overarching process—whether competitors are moving in, staffing, and if marketing or social can help ease those concerns. Loftis explains the holidays are both an opportunity and challenge for marketing. Gift cards. Online ordering. Seasonal items. “So how do you curate that conversation, and all the different touch points that we have ongoing? It’s a big time of the year for us and the tool helps guide that conversation as we close out the year,” he says. – Source: FSR.

The Move Provides the Brinker International Chain with Another Well of Management Candidates

Service men and women accepted into the groundbreaking program will earn a paycheck from Chili’s as they’re provided with the education and training to advance into supervisory positions for the chain. They will join the 250 Chili’s employees currently participating in the initiative, a pilot program forged by the National Restaurant Association Educational Foundation (NRAEF) and related groups under a grant from the federal government. The money was used to create a career path for young people who are interested in a high-income career but not in the costly higher education typically required for good-paying jobs. The NRAEF studied managers at Chili’s and other foodservice operations to determine what competencies are needed for success at the job. Those skills were codified into a model set of capabilities, and learning modules were developed to instill those abilities as a complement to practical on-the-job experience. Persons who complete the program are awarded with a diploma-like proof of competency that can help them land a management job at any restaurant chain. In the wake of Veterans Day, Chili’s and the NRAEF jointly announced that the apprenticeship program would be expanded to accept military vets who are currently or about to start transitioning back into civilian life. “We truly want these honorable men and women to see the restaurant and foodservice industry as a top option for fulfilling and rewarding careers,” Rick Badgley, SVP and chief people officer for Brinker, said in a statement. The joint announcement did not set a target of how many service men and women will be accepted into Chili’s program. Chili’s is believed to have the highest participation in the Hospitality Sector Registered Apprenticeship program within the restaurant industry. Taco Mac, a casual chain far smaller than Chili’s, is believed to be the first participant. It announced early this year that it would create 50 apprenticeships. The Hospitality Sector program is expected to serve as a model for other industries struggling to find sufficient employees, including the trucking business. President Trump has signed an executive order aimed specifically at encouraging the private sector to develop more apprenticeships program. – Source: Restaurant business.

Former Applebee’s Franchise Exec Named Uno CEO

After 11 years as CEO of UNO Restaurant LLC, Louie Psallidas has stepped down from his role. Psallidas made the announcement, “A farewell to my friends at UNO,” on his Linkedln page on November 21. When I first became CEO of UNO, a wise man told me that it would be important to recognize when the time comes to step away, and now after almost 11 years at UNO I have decided that the time has come for me to step aside and hand over the reins to a new leader,” he said in the statement. “This was one of the most difficult decisions I have ever made in my life. Everyone who knows me knows how much I love this brand, our company and most of all our people. I am blessed to have this opportunity to step off the merry go round of life, recharge my batteries and figure out what the next chapter will be.” In 2008, Psallidas joined Uno as chief financial officer and was later promoted to chief executive officer in 2014. Psallidas will be replaced by Jim Ilaria, a former CEO of an Applebee’s franchise company, Potomac Family Dining Group. The two will be working together over the next few months to make sure the transition goes smoothly. “I have worked with our ownership group to find a strong and capable successor with similar values and beliefs who can take the UNO brand to the next level,” Psallidas said in the statement. “I will be working with Jim over the next few weeks to insure a smooth and efficient transition. Jim is a great guy and I wish him all the best success.” Psallidas’ resignation comes just after the company announced a new refranchising initiative earlier in November. The brand sold eight company-run stores in the Maryland and Virginia markets to MVPizza, LLC. UNO expects another deal in the refranchising initiative to be completed by the end of the year. This second transaction will consist of company-owned units located in Northeastern markets. When the second transaction is finalized Uno will have 38 company-owned and 54 domestic franchised restaurants throughout New England, Florida, and Chicago. – Source: fsrmagazine.

PJW Restaurant Group Celebrates 35 Years of Success

Bob Platzer, founder of PJW Restaurant Group, the largest and most successful family-owned restaurant group in the Delaware Valley, has named hospitality veteran Jim Fris Chief Executive Officer as Platzer assumes the Executive Chairman role. The announcement comes as the restaurant group celebrates its 35th year of success. Bob Platzer and his wife Donna began in 1983 with a modest, 14-stool bar in Lehighton, PA.  Platzer was the visionary behind the restaurant concepts including the successful P.J. Whelihan’s, The ChopHouse, Treno and The Pour House.  Under his leadership, the group has grown to 22 locations and never had to close a store. In his new role as Executive Chairman, Platzer will formally step back from day-to-day but remain engaged in the group’s concept development and refinement, real estate ventures, and philanthropic efforts. “I feel very fortunate to have someone of Jim’s caliber as my successor,” says Platzer. “Stepping into a new role with greater freedom to motivate and inspire our team is the next logical step for me. The time is right as our foundation is strong, built on decades of successes and our operations are well-tuned. I am proud to turn over CEO duties to Jim, who not only has the expertise, but also has a deep understanding and respect for our company culture.” Fris, the group’s current Chief Operating Officer, brings over 30 years of experience in the hospitality industry. Under his tenure, the restaurant group has opened 15 new locations, created over 1,200 new jobs, increased sales and created synergies with local sports teams such as the Wells Fargo Center and Temple University.

As CEO, Fris will focus on elevating the group through new stores, strategic investments in current locations, and continued innovation to ensure the best guest experience. Fris was recently inaugurated Chairman of the Board of Directors for the Pennsylvania Restaurant & Lodging Association. “It is a privilege to be named CEO of PJW Restaurant Group. I’m honored and humbled by the trust and confidence Bob has placed in me,” says Fris. “It is an exciting time for us; we are continuing to expand the PJW footprint and providing more opportunities for our team to grow. I’m extremely optimistic about our potential.” PJW Restaurant Group will soon introduce two new concepts—Central Taco and Tequila in Westmont, New Jersey, in late 2018 and ChopHouse Grille is slated for 2019 in Exton, PA. For a limited time, all PJW locations will offer a special Holiday White Ale dubbed “Raising the Bar,” an homage to the group’s tagline. This collaboration with Yards Brewing Company will be available for $3.50 as part of the PJW Restaurant Group’s 35th anniversary celebration. – Source: fsrmagazine.

El Pollo Loco Taps Church’s, Popeyes Veteran as CMO

El Pollo Loco has named Hector A. Muñoz, a former executive at rival chicken brands Church’s Chicken and Popeyes Louisiana Kitchen, as its new chief marketing officer. Muñoz replaces Ed Valle who stepped down earlier this year after seven years with the chain. Muñoz will start Dec. 3. Muñoz joins the company from Atlanta-based Church’s Chicken, where he held the title of executive vice president and global CMO since March 2017. Before that, he spent six years as CMO at Popeyes Louisiana Kitchen, another Atlanta-based quick-service chicken chain. “Under his leadership, Church’s Chicken recorded five consecutive quarters of positive global same-store sales, the best performance of its kind in more than 10 years,” El Pollo Loco said in a statement released Tuesday morning. At Popeyes, Muñoz saw similar success “where he played a key role in achieving 24 consecutive quarters of positive same-store sales,” El Pollo Loco said. Muñoz, a Los Angeles native, previously served in executive roles at Burger King Corp., Long John Silver’s and Bruegger’s Bagels. CEO Bernard Acoca called Muñoz a “talented marketing executive with a proven track record of driving brands.” “As we continue to strengthen our leadership team, Hector’s significant industry experience and knowledge, paired with his strong leadership skills, will be instrumental as we elevate our marketing to grow the love our customers have for the El Pollo Loco brand,” Acoca said in a statement. Muñoz will oversee all marketing and brand strategy functions, including menu and new product development for the brand’s more than 480 company-owned and franchised restaurants. He steps in at a crucial time as the company plans launch a brand refresh in early 2019. The changes, discussed briefly in the chain’s last earnings call, will focus on dinner, delivery and family meals aimed at Hispanics, who are the brand’s most loyal customers. “I am joining the El Pollo Loco family during an exciting time,” Muñoz said in a statement. “It is an honor to join El Pollo Loco to support their people-first mission and culture.” – Source: NRN.

U.S.D.A., F.D.A. to Jointly Oversee Cultured Meat Regulation

The proposed joint regulatory framework will have F.D.A. oversee cell collection, cell banks and cell growth and differentiation. Production and labeling of food products derived from cultured cells of livestock and poultry will fall into U.S.D.A.’s jurisdiction. “This regulatory framework will leverage both the F.D.A.’s experience regulating cell-culture technology and living biosystems and the U.S.D.A.’s expertise in regulating livestock and poultry products for human consumption,” Agriculture Secretary Sonny Perdue and F.D.A. Commissioner Scott Gottlieb, M.D., said in a statement. “U.S.D.A. and F.D.A. are confident that this regulatory framework can be successfully implemented and assure the safety of these products.” The agencies released the statement as federal lawmakers continue work on a new farm bill, which includes a provision that would give U.S.D.A. total oversight of cell-cultured meats.  “Because our agencies have the statutory authority necessary to appropriately regulate cell-cultured food products derived from livestock and poultry the administration does not believe that legislation on this topic is necessary,” the statement said. Meat industry stakeholders have supported U.S.D.A. playing a leading role in regulating “fake meat.” Colin Woodall, senior vice-president of Government Affairs at National Cattlemen’s Beef Association (N.C.B.A.), said the agencies’ announcement “…is a step in the right direction” because U.S.D.A. would have primary jurisdiction over important facets of lab-produced meat. “But there is still a lot of work to do on this issue to ensure that real beef producers and consumers are protected and treated fairly,” Mr. Woodall said. “We look forward to continuing our work with the administration and Congress as this moves forward, and we continue to encourage producers to file official comments with U.S.D.A. and F.D.A. between now and Dec. 26.”

In August, the North American Meat Institute and Memphis Meats, a cell-cultured meat producer, said in a joint letter to President Donald Trump that U.S.D.A. and F.D.A. both “…have roles to play in regulating cell-based meat and poultry products. To ensure the regulatory system protects consumers while fostering innovation, it is imperative that the agencies coordinate and collaborate in their efforts, consistent with established policy.” Dr. Gottlieb and Mr. Perdue noted that the F.D.A. and U.S.D.A. are refining technical details of the framework which will include “…robust collaboration and information sharing between the agencies to allow each to carry out our respective roles.” – Source: Food Business News.

California Suppliers are likely the Source of Tainted Lettuce

A nationwide advisory to stop eating romaine lettuce remains in effect this week as federal health and food safety officials scramble to find new suppliers amid an E. coli outbreak that has sickened 32 people and hospitalized 13 in 11 states. The outbreak, announced jointly Nov. 20 by the Centers for Disease Control and Prevention and the Food and Drug Administration, forced grocers and restaurants to pull romaine lettuce from produce aisles and menus over the long holiday break. In a tweet posted the day after Thanksgiving, FDA Commissioner Scott Gottlieb said the “romaine implicated in the current outbreak is likely from California.” Seattle-based food safety lawyer Bill Marler said identifying California farms as the source is not a ground-breaking revelation. California and Arizona dominate U.S. lettuce production year-round, with California being the primary source of romaine in October, he said. The victims in the known cases reported getting sick in October, according to the CDC. The CDC’s blanket nationwide advisory to remove romaine from circulation “is essentially a recall of all product grown in California,” said Marler, whose firm specializes in foodborne illness cases.

This is the second major incident tied to contaminated romaine in 2018, and the third in the last 12 months. The current advisory warns restaurants and consumers to throw out all romaine including whole heads of romaine, hearts of romaine, bags and boxes of pre-cut lettuce and salad mixes that contain romaine, baby romaine, spring mix, and Caesar salad. Marler said his firm has been contacted by several victims from Canada and New York. All of them ate romaine served in meals at restaurants. He declined to name the restaurants because the firm is still investigating the events leading up to their illnesses. Industry looks to alternate greens. In a series of Nov. 23 tweets, FDA commissioner Gottlieb said the agency is working with the produce industry to restock the market with new “romaine from different growing regions, including Florida and Arizona.” He added that the FDA is working with growers and distributors on a system for marking produce with “post purge” labels that show the location and harvest date. “We want to help unaffected growers get back into production and enable stores and consumers to re-stock,” he said in a tweet. “One goal we’re seeking is to make this type of labeling the new standard rather than a short-term fix; as a way to improve identification and traceability in the system.”

Until then, restaurant chains, especially brands where romaine is a core ingredient on salads and sandwiches, grappled with how to adapt their menus during the advisory. Culver City, Calif.-based Sweetgreen said it has pulled “all romaine and spring mx containing baby romaine” from its nearly 90 stores. The fast-casual chain’s menu features signature salads as well as build-your-own offerings. “We are committed to serving safe, fresh, delicious food every day,” the company said in a statement. “We are focused on moving quickly and communicating when there is any risk to ensure we are keeping our guests safe.” Panera Bread and Habit Burger Grill are reworking menu items that call for romaine. The Habit Burger said it is using iceberg and red and green leaf lettuces as substitute leafy greens on some menu items including salads. However, the Caesar salad is off the menu for the time being, the Irvine, Calif.-based company said. Panera Bread is informing customers about the romaine alert on its app. A message in the app reads: “We’re always committed to your safety and serving you the best product possible, so we have substituted other fresh greens for romaine lettuce.” Ingardia Bros., a Santa Ana, Calif.-based produce distributor, said many of its restaurant clients have been asking for alternative leafy greens such as iceberg, Boston, green leaf, red leaf, spinach, escarole and arugula. “Because of the sudden and very high demand for these items, prices are jumping quickly,” Dave Samuels, a company representative, said. The Habit Burger, for example, said it is “challenged” by the demand for substitute leafy greens. “Since the CDC’s advisory, supplies of all types of lettuce have become challenged and The Habit is managing the menu adjustments on a day-to-day basis and will continue to do so throughout the week,” the company told NRN. Romaine alerts on the rise. This is the third E. coli outbreak tied to leafy greens and romaine over the past 12 months. The FDA said the E. coli strain in the current outbreak is similar to the one associated with the fall 2017 outbreak blamed on leafy greens in the U.S. and romaine in Canada. The current strain is not related to the E. coli “outbreak linked to romaine that occurred in the spring of 2018,” the CDC said. That multistate outbreak, announced in April, was tied to romaine grown in Yuma County in Arizona. After a months-long probe, the FDA said the romaine was likely tainted by contaminated irrigation water found near the Yuma growing area. In the spring 2018 outbreak, 210 people in 36 states reported getting sick. Five deaths were reported, and 96 people were hospitalized. Marler said his firm is representing more than 100 victims in that outbreak, including 25 who ate at Panera Bread. He said Panera got its lettuce from a supplier, who in turn, sourced its romaine from “multiple” sources — a common practice that makes traceability difficult. Until the FDA and produce suppliers can find an accurate and fast system for traceability during an outbreak, “overly broad” alerts like the romaine warning are likely to be commonplace, Marler said. In other food safety news, the FDA said Long Phung Food Products, a Houston-based company, has voluntarily recalled ready-to-eat pork products that may be adulterated with Listeria. The ready-to-eat pork patty rolls were produced from May 21 to Nov. 16 of this year and were distributed to various retailers and distributors nationwide, the FDA said last week. Food safety regulators believe the products are tied to a cluster of listeriosis illnesses reported in recent weeks. – Source: NRN.

Packaging: A Control Point for Food Safety

While product recalls in the bakery and snack industries are most often due to undeclared allergens or the detection of pathogens like Salmonella or E. coli, there have been food safety issues related to packaging. For example, a package that is not secure in some way can lead to food safety hazards ranging from spoilage to sabotage. Dan Inman, director of quality, research and development for the Long Co., said many manufacturers have focused on packaging integrity to prevent safety-related problems but vulnerabilities remain. “You still have bread and buns out there in packages that are closed with a wire tie or click lock and that have the potential of being opened and resealed without the consumer ever knowing the package had been opened,” he said. Some bakeries have added a literal extra layer of package security. Mr. Inman cited Pepperidge Farm bread loaves that are wrapped within another bag. “Having a double seal makes it more secure,” he noted.

In addition to package integrity, proper labeling is important in ensuring product safety for consumers. In an era of increasing food allergies, bakery and snack packages must have accurate information on the label that provides details on ingredients, claims and allergens. That may get more complex, cautioned Mr. Inman. “Right now, the F.D.A. is looking at adding sesame seeds to the list of allergens, and that would have a huge impact on baking because there are a lot of items that that would suddenly require a complete allergen cleanup and label,” he said. “Part of food safety is having alerts of allergens.” In addition to allergen alerts, visible “buy by” and “sell by” on-package information is pivotal for any perishable bakery or snack item. To reduce risk in the critical control point of packaging, suppliers and manufacturers are using materials and formats that enhance accurate labeling and package security. Getting buzz in recent times is the use of intelligent and active packaging, which may be achieved through technologies embedded in the package that provide information on allergens, nutrition details and expiration dates. According to Research and Markets, the market for active packaging in the United States is expected to reach a market size of $8.11 billion in 2022. On the active packaging side, next-generation flexible packaging with nanoparticles, for example, can provide barriers to moisture or light that can cause spoilage.  The Active and Intelligent Packaging Industry Association and other partners are working on such nano-packaging technology, including the incorporation of natural antimicrobial agents into packaging films. Those films have been shown to slow mold growth on breads without food additives. Other R.&D. work is taking place in intelligent packaging, including packages with time and temperature indicators that alert consumers to possible spoilage. – Source: Food Service News.

Consumers’ Personal Definitions of Health Dictating Decisions at Restaurants

Forty per cent of consumers say their definition of health has changed over the past two years — and that definition is driving their choices of food and beverage, according to Technomic Inc.’s 2018 Healthy Eating Consumer Trend Report. Consumers are increasingly ordering menu items that meet that personal definition of health, such as food described as natural, organic, high in protein, sustainably sourced or functional. “The food service landscape will become more competitive when it comes to tastier, more innovative healthy menu offerings,” said Maia Chang, senior research analyst at Technomic. “This means that more brands will face additional pressure to differentiate through transparency and preparation techniques, as well as brand and sourcing stories.” Calorie counts are still a concern for some consumers. Despite abiding by their own health definitions, consumers may still reconsider their restaurant orders if the item contains too many calories, Technomic said. Sixty-six per cent look for calorie counts on restaurant menus at least some of the time. “Consumers are increasingly taking on a more personalized, holistic view of health,” Technomic said. These views have implications for restaurant operators, especially as some restaurants are now required to post calorie counts and consumers increasingly rely on food service for meals.” Restaurateurs may meet this desire for lower-calorie options with menu items featuring vegetables instead of carbohydrate-rich items, such as cauliflower pizza crust and zucchini noodles. Forty-five per cent of consumers say they would be very likely to order healthier options at restaurants if they were offered, Technomic said. In convenience stores, operators must focus on freshness and quality to meet consumers’ evolving definition of health. “To fully capitalize on food service opportunities, brands must address consumers’ lingering concerns about the quality and freshness of prepared foods and beverages at c-stores,” said Charles Winship, senior research analyst of consumer insights at Technomic. “The most reliable way for c-stores to convey quality and freshness is by utilizing real ingredients and leveraging transparency so consumers know how, when and where items are prepared.” – Source: Food Business News.

CAVA’s Purchase of Zoes Kitchen Becomes Official

Cava Group Inc. completed its acquisition Wednesday of Zoes Kitchen, creating a privately held Mediterranean fast-casual company with some 340 units and more than 8,000 employees. The $300 million deal, first announced in August, was financed by a “significant equity investment” from Act III Holdings, the emerging brand-accelerator financing group created by former Panera Bread CEO Ron Shaich. Shaich becomes chairman of the combined company and Brett Schulman becomes CEO. Kevin Miles, who became CEO of Zoes Kitchen in 2009, is no longer with the company. The combined business officially begins operations Thursday, ending Zoes Kitchen’s four-year tenure as a publicly traded company. Zoes Kitchen’s sales had been declining in recent quarters, with comps falling some 7% in the early weeks of the third quarter of this year, making a buyout offer especially attractive. Taking Zoes Kitchen public will free it from shareholder scrutiny, Shulman told Restaurant Business shortly after the deal was announced. “It’s just more challenging to do it under the public lens,” he said, citing Cava’s growth as an example. “It’s not that you can’t do it. It’s just more challenging.” The deal will fuel expansion of the Mediterranean fast-casual brands. “With this acquisition, Cava will be able to broaden our geographic footprint and meet the needs of even more guests,” Schulman said in a statement. “As part of the Cava family, Zoes Kitchen will benefit from Cava’s track record of bold culinary innovation and leveraging data and technology to drive growth and convenience.” The new company is headquartered in Washington, D.C., Cava’s home, and will keep a “meaningful presence” in Plano, Texas, where Zoes Kitchen began in 1995. “The Zoes Kitchen brand will remain intact for the foreseeable future,” the company said Wednesday. – Source: Restaurant Hospitality.

The Breakfast Wars Heat Up for Full-Service Restaurants

Breakfast used to be an after-thought at most full-service eateries, but no longer. Now a number of restaurant chains specializing in breakfast such as First Watch, Black Bear Diner, and Metro Diner are showing steady growth and intensifying the competition against long-standing rivals like IHOP and Denny’s. As more Americans work independently and crave in-person companionship away from their smartphone screens, full-service breakfast business is on the upswing. Will the long-standing chains hold off the competition from fast-growing rivals, who are expanding at a rapid pace? Moreover, a 2017 study on breakfast consumption saw dining out rise in every segment, including full-service restaurants, fast casual, and quick-service eateries. It pointed out that “younger consumers spend more at breakfast than their older counterparts,” and that average breakfast checks are $13 for breakfast at full-service eateries and almost $10 at fast-casual spots. The larger chains that offer breakfast have seen modest growth or slight slowdowns, including IHOP, which saw its domestic same-store sales increase 1 percent in the first nine months of 2018. System-wide comps lifted 1 percent during third quarter at Denny’s. For the fiscal 2018 calendar, traffic fell 1.9 percent and comps increased 0.6 percent at Cracker Barrel. Significant growth came, especially in regards to unit count, from the emerging sector. Because of their expansion and the whitespace compared to legacy chains, the upstarts have scaled at a faster pace than the more mature, established chains. Consumers are dining out at breakfast more because of their busy at-home schedules. As a culture or society, life is not getting less stressful or slower. There’s less time spent at the stove cooking,” says Matthew Britt, a chef and culinary instructor at Johnson & Wales University in Providence, Rhode Island. Since consumers can dine out at a reasonable price at IHOP, Denny’s or First Watch, they say, “It’s worth my time to dine out,” Britt adds.

From a business viewpoint, chain restaurants can turn a profit because they buy eggs in volume, which brings their food costs down, and can turn a healthy profit, Britt says. In teaching breakfast to culinary students, Britt trains them to “understand classic techniques about how to make an omelet and the variety of an egg. We make pancakes and sausage as separate components, and then combine them, into your own McGriddle.” They’re also encouraged to prepare innovative items such as cauliflower dishes and porridges. Responding to consumer tastes, Denny’s, for example, offers its Grand Slam Slugger breakfast consisting of two pancakes, two eggs, two bacon strips, two sausage links, with hash browns or toast, juice and coffee. “Americans want to eat everything,” Britt says. The rise in dining out for breakfast contributed to the formation of Metro Diner, which offers comfort food at every meal and has struck a chord at breakfast time. Yelp aficionados praise its “unique pound cake French Toast” and noted the “long wait, which is worth it.” That kind of reaction has contributed to Metro Diner’s rapid growth to 60 locations (58 company-owned) in four years with 25 new outlets planned for 2019. Hugh Connerty, co-chairman of Metro Diner and founder of Hooter’s and partner in Outback Steakhouse, attributes the spike in dining out breakfast at full-service eateries to “the changing dynamics of society. People aren’t about ducking in and grabbing a McMuffin’s on the road anymore,” he says. Many breakfast customers aren’t tied to 9-to-5 jobs and are operating in creative-style freelancing jobs. Connerty says that there are shifting crowds most weekdays at a Metro Diner. The 7 a.m. crowd attracts working people like construction workers, and then starting around 9 a.m. it draws more diners with a “leisurely lifestyle or for business meetings,” who congregate in groups of four to six people, he says. On weekends, the crowds line up and mostly consist of friends and family, not business-related, he says. Connerty says they’re aiming to keep Metro Diner’s restaurants compact, accommodating about 100 to 125 guests to ensure personalized service. Hearty breakfasts prevail at Metro Diner as well. Fried chicken and waffles is the No. 1 seller, with egg dishes close behind. “You can’t eat what we put in front of you, and almost everyone takes food to go,” Connerty says. But for the health conscious, there’s avocado toast, fruit, and egg-white omelets. “There are about 1,600 IHOP’s and 1,600 Denny’s and 755 Outback’s. And we think wherever there are Outback’s, there could be at least one if not two Metro Diners,” he says. Metro Diner’s concept of strong service, healthy portions, and comfort food appeals to a wide audience, ranging from retirement communities at the Villages in Florida and with millennials and college students in Gainesville, near the University of Florida. But forthright Connerty reveals that it hasn’t clicked with one audience: kids. “You see a few kids at Metro Diner, but most parents take their kids to McDonald’s or Chick-fil-A. We consider ourselves a family restaurant, but it’s been a challenge,” he says.

The more the media promotes the value of breakfast. the more it can grow, says First Watch president Chris Tomasso. First Watch, which is only open for breakfast and lunch and closes at 2:30 p.m., now has 283 eateries, and will have opened 57 new stores in 2018. Its president, Chris Tomasso, who is based in University Park, Florida, says offering two meals a day enables it to be a specialist. “We’re not trying to be all things to all people,” he says, adding that it can attract better talent because they won’t have to work late. Moreover, First Watch specializes in fresh food and doesn’t use “deep fryers, heat lamps or microwaves,” and prepares pesto chicken quinoa bowls, and offer fresh avocado in many dishes, as differentiators. The number of people dining out at breakfast is still proliferating because of power breakfasts, Tomasso says. “It’s easier to meet someone for breakfast than break out of your day,” he says. Hence he sees realtors, pharmaceutical reps, and financial advisers meeting with clients over breakfast. Buoyed by private-equity money, all of its new eateries are company-owned, and it no longer franchises.”The ROI is better for us to own,” Tomasso says. Growing rapidly has its traps, and other franchises have shot themselves in the foot by expanding too rapidly. Tomasso says it has increased spending on people development and career planning and has invited 400 managers for leadership training to avoid “dilution of culture, dilution of procedures, and dilution of core values.” Tomasso expects growth for dining out breakfast to continue to spike. “The more the media promotes the value of breakfast,” the more it can grow, he cited. And many people still haven’t adopted breakfast as a meal occasion. Chef Britt expects that dining out breakfast at full-service eateries “will continue to grow. More and more people are becoming passionate about dining out breakfast, and more are finding healthier alternatives. They’ll need more places that serve people who are busy and on the go,” he says. – Source: FoodNewsfeed.

Bloomin’ Brands is Killing Discounting and Boosting Profitability

Bloomin’ Brands reinvigoration of Outback has, rightfully so, grabbed headlines in recent months. If you look back to the first quarter of fiscal 2017, the company shuttered 14 restaurants and followed by refranchising 54 corporate stores to longtime franchisee partners. In Q3 of this year—the most recent report for the legacy steakhouse—same-store sales rose 4.6 percent with traffic up 0.9 percent, marking the sixth consecutive quarter of positive traffic and seventh straight period of positive comp sales. Less in the spotlight, however, was the performance of Bloomin’s other brands—classic Italian chain Carrabba’s, Fleming’s, and Bonefish Grill. In that same Q1 2017 period, sales were negative at all three chains and 24 units closed down (14 Carrabba’s, nine Bonefish stores, and one Fleming’s). In February 2016, Bloomin’ announced it planned to close 14 Bonefish resturants. While Outback remains the top draw with 737 U.S. locations, the three chains represent a very significant footprint by any measure. As of last quarter, there were 224 Carrabba’s (three franchised), 199 Bonefish restaurants (seven franchised), and 70 company-run Fleming’s. This is partly why Barington Capital Group, L.P., which owns less than 1 percent of Bloomin’s shares and represents a group of shareholders, suggested the company spinoff or sell the three chains so Bloomin’ could enhance its strategic focus. “It is our belief that a more focused management team would perform substantially better and do a more effective job of enhancing the guest experience to improve customer loyalty and increase revenues,” it said in a letter to the company’s board of directors. Bloomin’ responded swiftly, saying, “We are making great progress in elevating the total customer experience by investing in food quality, service, and ambience.” Casual groups like Darden, Dine Brands, and Brinker—with just two brands in those latter cases—have managed success following a diversified approach. What has Bloomin’ done to improve its business across the rest of its portfolio? The discount drop.

In the second quarter of fiscal 2018, Bloomin’ Brands said it cut discounting 19 percent systemwide. It was sliced nearly in half (44 percent) at Carrabba’s alone. Year-to-date, Carrabba’s discounting is down 37 percent, Bloomin’ CEO Liz Smith said during the company’s Q3 recap. Bloomin’s goal is to rebuild traffic based on superior food and execution, not deals. Carrabba’s shifted its marketing strategy from more complicated and disruptive LTOs to “excellent execution of the core menu and special occasions,” Smith said. “We are also targeting more proprietary programs, such as our successful wine dinners and Amore Mondays as well as growing off-premises via Family Bundles and delivery platforms to drive healthier traffic,” Smith said, adding later that an additional 200 Outback and Carrabba’s planned to add delivery by year’s end. Smith said the three brands have been in an 18-month to two-year journey to take discounting out of the base. She said, for all intents and purposes, Bloomin’ expects to complete that strategy by the end of 2018. In the near-term, however, doing so sapped traffic. Smith said the eventual return would more than make up for the dent. “And then we are going to be able to monetize the investments we put in those brands, and the portfolio has reached the point where we will, by the end of the year, have lapped the majority of the discount pullback and it will not be the traffic headwinds that it has been over the last two years.” What’s happening, Smith said, is Bloomin’ ripped out the discounting, took a traffic setback, and then watched much higher quality traffic flow into the system. Fleming’s and Bonefish, for example, are on track to report record profitability. “We continue to migrate our marketing resources away from national toward more impactful local programs.” — Bloomin’ Brands CEO LIz Smith on Bonefish Grill. Carrabba’s has been a slower grind, though. The chain’s pivot, frankly, was further away from its core proposition—authentic Italian dining at affordable prices. “I think the way we’ve managed the portfolio, with the strength of Outback, has given us the ability to put the Outback playbook in effect on all the others and getting the discounting out—that’ll be behind us as we exit Q4. So we’re looking for certainly a lot more traffic strength as we enter next year.” Simplify and know the audience. Bonefish has witnessed a nice improvement over rough lapped results recently. Smith said Bloomin’s effort to simplify execution, while investing in food and the dining experience “returned the brand to its polished casual roots, known for fresh fish, innovative drinks, and superior service.”

In October, Bonefish rolled out a new brunch menu and expanded brunch to Saturday. “We continue to migrate our marketing resources away from national toward more impactful local programs,” Smith said. “This local philosophy helped define Bonefish as the ‘unchained chain’ and it’s paying off in sales and profitability.” Fleming’s made some directional changes, too, moving away from legacy-value offerings, such as its 567 Bar Menu, $29.95 Prime Rib, and some non-holiday gift card distributions. “We anticipated the negative impact on traffic from these actions, however, they have had a positive impact on profitability,” Smith said. Smith said Fleming’s would continue differentiating the brand from the traditional high-end steakhouse to a localized menu selection and customer segmentation. The strategy appears effective across the portfolio not counting Outback, but especially these two. Chains that present like local restaurants, and carry the price tag and service promise to match. Smith added that the last five Fleming’s have “just been terrific and opened well above the system average. Rewards round out. “I think it’s another example of where you really have this benefit of having a tightly edited portfolio that serves different eating occasions,” Smith said. There are benefits to running concepts that serve multiple dayparts and price points, and Rewards is one of them. Smith said Bloomin’ has seen a traffic lift associated with introducing customers of one brand to another. “That is why you’ve seen so much success on the two-year basis associated with the program—is that when we say it’s increased frequency, it’s not just increased frequency against that customer in many cases within that brand, but it’s also introducing them to another brand.” Bloomin’s Dine Rewards program has more than 7.2 million members. Close to 600,000 came in this past quarter. The company’s CRM investment to boost engagement through customer-centric communications has been one of the main catalysts for Outback’s comeback. The shift from mass marketing to data personalization. It’s attracting a healthier consumer than the average coupon seeker and has also driven strong engagement across Bloomin’s portfolio. It’s allowed the company to reduce its advertising spend from 3.8 percent in 2016 to about 3.1 percent over the last two years, while improving return on investment. “Our CRM and our mass personalization, a lot of time and patience went into adjusting it, and into investing capital dollars ahead of growth to build our data’s infrastructure capability and now we’re monetizing it,” Smith said. She added that Bloomin is still “in the early innings of our loyalty journey.” “We are now getting the data and developing very specific data customer profiles for our Dine Rewards program, which enables us then to market directly to the customer and have enhancements that could drive frequency even further,” Smith said. – Source: fsrmagazine.

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