To Our Valued Subscribers:
Here it is the middle of August and the summer is almost coming to a close. How fast has it gone? My Cubs are hanging onto first place in the Central Division by a thread and the Mets have been resurrected; what a season! Pro and college football seasons are around the corner and most organizations (including American Recruiters) are well into our Long Range Planning Process. As you and your organization are engaged in the process, here is a tip from noted author journalist and consultant Josh Levs. I hope the tip is as helpful to you as it is to us. Josh states “If you really want to create fans of your business who will become advocates for you, you have to use a narrative.” People connect with the story behind a business. Any company that evokes strong brand loyalty, the connection with consumers rests largely in the story line. (Think Starbucks and Coca- Cola). So how do you begin? According to Levs the best way to initiate your story is to ask questions not just of people from the top but at all levels of the organization. Questions such as: What drove you to be part of the company? And What do you want to see the company become? You will find that the different stories of people inside an organization overlap in some important ways. Every company’s story ultimately involves bringing people together to achieve a common goal. Customers don’t need to share those same goals for a company’s story to resonate. They like knowing that a business is run by people who care deeply about an issue that matters. (Like Customer Service Quality etc.) . I hope this tip helps in your planning process. What will also help is keeping abreast of the current news in our industry; so, enjoy the latest edition of American Recruiters Global Foodservice News.
Brinker to Buy 116 Chili’s from 14-Year Franchisee
Dallas-based Brinker International Inc. plans to buy 116 Chili’s Grill & Bar restaurants from franchisee ERJ Dining, according to a regulatory document filed Wednesday afternoon. The parent of Chili’s did not disclose the value of the deal, only stating that the restaurants generate revenue of about $300 million a year. Most of the casual-dining restaurants are in the Midwest. EJR is based in Louisville, Ky., and has been a Chili’s franchisee for 14 years. The transaction, funded by an existing line of credit, is expected to close in the first quarter of 2020, Brinker said. “This acquisition is a compelling opportunity to further invest in our brand, broaden our scale and create growth in earnings and cash flow,” said Joe Taylor, Brinker’s chief financial officer, in a statement. “We appreciate the relationship we developed with ERJ over the years and view these well-established restaurants as a solid foundation for further growth in these markets.” Other restaurant brands have been buying back franchised units. In December, for example, Applebee’s, a division of Glendale, Calif.-based Dine Brands, took a step back into restaurant ownership with the purchase of 69 locations from Raleigh, N.C.-based franchisee Apple Gold Group. For the third quarter ended March 27, Brinker’s net income was up 6.2% to $49.8 million, or $1.31 a share, from $46.9 million, or $1.02 a share, in the prior-year period. Revenues increased 3.3% to $839.3 million from $812.5 million in the same quarter last year. Same-store sales at Chili’s company-owned restaurants increased 2.9% in the quarter. Same-store sales at U.S. franchised restaurant sales increased 2%. For the recent Nation’s Restaurant News Top 200 census, ERJ reported U.S. sales of $325 million for the fiscal year ended in December 2018 from 123 franchised Chili’s locations. Those fiscal-year 2018 sales were up 3.2% from $315 million in 2017, when EJR ended the year with 125 Chili’s restaurants. Brinker, the parent of Chili’s and Maggiano’s Little Italy, has about 1,700 restaurants. – Source: NRN.
Staying Power: Antoine’s Restaurant
As one of the oldest continuously family-owned and operated restaurants in the country, French-Creole restaurant Antoine’s of New Orleans has a rich history that goes back almost two centuries. Today, the restaurant is known for its 15 themed dining rooms including Mardi Gras themes and the Mystery room that dates back to a Prohibition-era speakeasy. Antoine’s was also the birthplace of numerous famous culinary dishes, including Oysters Rockefeller, Pompano en Papillote (filet of fish baked in sealed parchment), Eggs Sardou (a poached eggs with artichokes, spinach, and Hollandaise sauce), and Pigeonneaux Paradis (roast pigeon or cornish hen). Original owner Antoine Alciatore, a French chef from Marseilles, immigrated to America in 1839 and eventually made his way from New York to New Orleans. He opened up the original location of Antoine’s in 1840 as a bed and breakfast. After a couple of decades in the business he moved Antoine’s a block away and it became a more contemporary idea of a restaurant in 1857. “The original dining room today is very similar to what it was then — many of the chandeliers and lights are the originals, although they became electric instead of gas,” said Lisa Blount, publicist for Antoine’s and wife of the current owner. After Alciatore contracted tuberculosis and died in the late 19th century, his son Jules took over the family business. This is the era of Antoine’s history when culinary innovation really shined.
When Jules invented Oysters Rockefeller — so named because the dish was so rich (the original recipe called for 40 pounds of butter) — it was a nod to the then-wealthiest man in America. “Jules was really talented at attracting famous people who came to town,” Blount said. “We knew that Jules was a real promoting personality; he had a booming business.” After Jules stepped down, his son Roy — who was known as a marketing genius — took over and introduced the concept of the themed dining rooms, including the now-defunct Japanese room, which was closed after World War II. Following his death and the end of the “Roy era,” other family members came in and attempted to run the restaurant exactly the way he had, but the seemingly infallible dynasty began to falter. “In the transition from Roy to his sister’s children, there was a struggle,” Blount said. “Nothing lasts forever. It had started to diminish in luster somewhat. […] Nobody was here anymore.” The fifth generation of Antoine’s restaurant is now owned and operated by Antoine’s descendent, Rick Blount, who took over the restaurant in 2002. Although the latest generation of Antoine’s has gone through some challenges — including surviving the destruction wrought by Hurricane Katrina in 2004 — Lisa Blount said their success now comes from the right mix of tradition and keeping up with the times. “Our dining room is different these days,” she said. “We have evolved our service style and menus. People are not going to sit around and wait for an item to be cooked for 45 minutes anymore. […] And there’s more diversity on the menu now. Some things became obsolete but now we have gumbo and crawfish. All of these classic dishes are really our heart and soul, so let’s adapt and add things from there.” The Blount family even had to relent on Antoine’s well-known strict dress code to appeal to the modern diner that is not so buttoned up. “There was some soul searching with what is our mission is now,” Blount said. “We had a great legacy, reputation and wonderful traditions. [….] We were like, ‘how do we adapt to cargo shorts and flip flops?’ So we decided on a middle ground of collared shirts, but in the evenings we still prefer the men to wear jackets.” Dinner at Antoine’s ranges from $70-$80 per person for dinner or $35 for lunch. The restaurant itself is 35,000-square feet. – Source: Restaurant Hospitality.
Perkins Franchisee Files for Chapter 11 Bankruptcy
A franchisee of 27 Perkins Restaurant & Bakery locations filed for Chapter 11 bankruptcy protection after losing the right to use the parent company’s name. The franchisee, 5171 Campbells Land Co., based in Rankin, Pa., said in the U.S. District Court for the Western District of Pennsylvania filing that it had assets of between $1 million and $10 million and liabilities in range of $10 million to $50 million. According to local reports, 5171 Campbells operates restaurants in Ohio, Pennsylvania and New York. Earlier this month, a federal judge in Memphis, Tenn., granted franchisor Perkins & Marie Callender’s Inc. a restraining order that kept the franchisee from operating under the Perkins name and ordered it to stop using signs, flags, menus and anything else displaying any Perkins trademarks, and also to change the restaurants’ phone numbers. A June lawsuit said that 5171 Campbells had been in default of marketing contributions, royalty fees and transfer fees since April 2018 and had also failed to “uphold the standards set forth in the license agreements,” including carrying out required restaurant upgrades. The lawsuit said those fees amounted to $2.2 million. According to a report in the Pittsburgh Post-Gazette, Campbells had itself bought the 27 locations out of bankruptcy in January 2018 for $7.8 million and promised to spend $12 million in upgrades over the next two years. WKBN-TV of Youngstown, Ohio, reported that the bankruptcy filing occurred hours before a hearing in Tennessee on the permanent closure of the 27 locations. Perkins & Marie Callender’s is itself up for sale and is considering filing for bankruptcy protection. In June 2011, the company filed for Chapter 11 bankruptcy protection and emerged from it six months later. According to Nation’s Restaurant News Top 200 data, Perkins had 356 locations at the end of 2018, with 239 of those franchised. – Source: NRN.
Mimi’s Café is Now Mimi’s Bistro + Bakery
After 41 years in business, Mimi’s kick-started a refresh project Monday it believes will strengthen the chain’s connection to France, and help accentuate differentiating traits amid a growing fast-casual category. The modernization also includes a new name: Mimi’s Café is now Mimi’s Bistro + Bakery. Philippe Jean, chief operating officer for Le Duff America, Inc., which bought the brand from Bob Evans in 2013 for $50 million, said creating a new name and face for Mimi’s was long overdue. While pushing the French positioning, it will also maintain the “heritage that made our guests fall in love with our brand in the first place,” he said. To get the change started, Mimi’s introduced a Bites + Beverages menu with Mimi’s House Wine developed specifically for the brand in Bordeaux, France. There are also new cocktails and appetizers. The House Red and House White Wine run $6 per glass and $22 per bottle. Some cocktail options include: the French 75, a twist on the classic, the French Mule, and a martini selection. Appetizers on the menu feature Hummus & Crudités, Brochette Trio, and Flatbreads. Mimi’s, founded in 1978, has 77 U.S. locations across 16 states. It plans to complete 10 renovations by fall, with new interiors, furniture, bar areas, and innovations in technology.
Le Duff runs Brioche Dorée, Ristorante Del Arte, Fournil Pierre, and La Madeline, among others. Last February, the company sold Timothy’s World Coffee and muffins to focus on launching Brioche Dorée in the U.S. The company also previously dealt Bruegger’s Bagels to Caribou Coffee to spur growth of its French-heritage brands, including La Madeleine, Brioche Dorée and Mimi’s. At the time, Le Duff said, “The sale of Timothy’s and muffins is another important step in sharpening our focus as a French company.” The Mimi’s refresh will do just that on the brand level. Tiffany McClain, Mimi’s head of marketing, took some time to chat with FSR about the changes, what it means for the brand, and what’s still to come. What was the driving force behind the name change? And how do you think it better aligns Mimi’s message with its guest experience? After 40 years it was clear that we needed to reinstate the culture, vision and North Star of the brand. As a French-inspired concept we wanted to strengthen the connection to our heritage and where it all begin—our cuisine. We felt it was of the upmost importance that our namesake should reflect that connection and our commitment to great food, a welcoming atmosphere and the best of bakery. Talk about the connection with France and how that sets Mimi’s apart, and why it was so important to emphasize with this change. At Mimi’s we’re focused on our heritage and strengthening our connection with France. We have the privilege as a French-inspired brand, to be owned by a renowned French restaurant company, Groupe LeDuff and we are led by president who began his restaurant success in France and now lives in the United States. With these connections to France and the authenticity it rewards us, it was important to that we have integrity in the food we were presenting, the beverage options and the environment our guests enjoy.
How does the new Bites + Beverages menu fit into the strategy? And how does it really reinforce the family and social gathering strength of the brand. The core of our brand’s value is celebration of life around friends, food and family. This new menu allows us a vehicle to communicate those celebrations year-round in a way that can refresh seasonally, satisfy guest cravings and bring them the best of French-inspired shareable appetizers, desserts and beverages. Something that will really bring people together to encourage laughter and making memories around the table. What are some design changes guests can expect to see? You’ll begin to notice right away a ‘refinement’ of our menu and décor. Our heritage and connection to France was weakened and left a lot of guests wondering what kind of restaurant we were. Our goal in this refinement is to create something that truly points our guest toward the embodiment of what French-inspired means. Whether that is in a fine wine from our own Mimi’s collection from Bordeaux, our craveable French Pot-Roast, or the always comforting Croissant and Muffin collection along with our specialty coffees in a cozy atmosphere liken to a bistro in Paris. In the 10 locations that will receive an update before years end, you will see a cohesive art collection of photographs from the streets and shops of Paris, the rolling vineyards in France and the beautiful gardens throughout the countryside. Additionally, we aim to bring the process of patisserie and our cooking techniques to the forefront. Holistically, our goal is to open up the floor plans to allow for larger seating in the bar area, an easily accessible to-go area with a showcase bakery and patisserie and an open, theatrical kitchen showing our team members artistry with your selections. You’ll also note that our environment and design changes will include comfortable seating, in both the waiting, bar and dining areas – encouraging guests to invest their time and relax in their destination for dining. What are some technology innovations on deck?
For the past two years, we have invested in vendor partnerships that allow us the ability to rebuild our technical stack the ground up. With that, we know a strong digital strategy is a must as we focus on our guest experience. We have discovered that even the latest and greatest tools and platforms lack the basic necessities for a multi-unit brand such as managing pricing tiers, varied hours of operation and data backups. Our marketing and IT teams worked together seamlessly with hand-selected vendors to cohesively generate a plan that has worked for Mimi’s. To date, our IT teams have successfully updated all locations with a SD-WAN platform network that includes dual auto-failover Internet connections, dual switches with 24-7 monitoring and security management. Our team has also strengthened our tech stack with MetTel’s platform to eliminate points of failure in Internet, network and WiFi services as well as a POS update to Aloha’s newest platform. These mandatory tech updates allow our teams a runway to achieve full integrations in reservation platforms, third-party, more functionality and better experiences with our off-premises programs. – Source: fsrmagazine.
The Rest of the Best
Brands ranked below the category average in alphabetical order: Applebee’s, Bahama Breeze, Benihana, BJ’s Restaurant & Brewhouse, Bonefish Grill, Carrabba’s Italian Grill, Chili’s Grill & Bar, Dave & Buster’s, Denny’s, P.F. Chang’s China Bistro, Romano’s Macaroni Grill and Italian Restaurant, Ruby Tuesday, Shoney’s, TGI Fridays. TEXAS ROADHOUSE: Casual dining: The heartbeat of the American consumer. If there’s one thing the micro-chain movement taught us about casual dining, it’s that restaurants can’t bank checks entirely on brand equity. This generation of customers is less forgiving and sticky. They’re not as much brand loyal as product and lifestyle loyal. They hold chains accountable across the marketing and operational spectrum, everything from sourcing to mission statements, community involvement, seamless ordering, design, and pretty much every other element inside and outside a brand’s personality. But what these legacy chains can do, however, is put that scale behind disruptive industry trends. While you could tap delivery, off-premises in general, mobile access, and technology advancements as opportunity fire starters, they’re also headwinds. All restaurants want to drive frequency, of course, yet how many can invest significant marketing spend in a value campaign?
And it’s not just about competing on price. Casual players with strong guest affinity have an opportunity to court guests via loyalty. They have the data wealth and segmentation tools to target customers with comeback deals and other incentives independents typically don’t. The ability to go well beyond the email list and Facebook updates, if leveraged smartly. Does this help cover some of the ground chains lose to local spots in regards to younger consumers? Brinker International CEO Wyman Roberts said of Chili’s in May, “there’s a consistent pattern of over performance by larger concepts versus smaller concepts. So the independents and the smaller concepts really now, for a while, have been losing share to the larger concepts, and we continue to see that as probably something that will play itself out into the future.” What he was referring to was Chili’s ability to lean into its marketing spend and promote a value construct in ways regional or single-unit concepts couldn’t. Chili’s moved away from traditional marketing—bringing new news to consumers—to a more guest-centric model that focuses on embedded traits that don’t change by the promotional calendar. There’s also the rise of at-home dining to consider (according to industry data, 28 percent of consumers stay at home more versus two years ago) and how equity-heavy brands can compete.
Dining out of home represents an $870 billion slice of the restaurant industry. Casual-dining amounts to roughly $86 billion of that competitive set, according to NPD. How does this affect the big brands? Firstly, there’s the ability to strike massive deals with aggregators, as Chili’s just did with DoorDash. There’s also the notion of restaurant models themselves. Just glancing at some legacy players, like IHOP, Buffalo Wild Wings, Denny’s, and Outback, you see innovation in the footprint. Most chain restaurateurs would agree, if they could rewind time with a crystal ball in the desk drawer, they would take another look at how restaurants were thought out from a functional perspective. A dedicated pick-up element. The ability to integrate POS technology with third-party delivery, etc. Bloomin’ Brands, in one example, has a relocation strategy that moved 50 Outbacks since 2012 (14 last year). Those units are witnessing a 30 percent sales lift. Before relocation, they averaged $2.9 million AUVs. After: $4.1 million. Bloomin’ said there’s potential for at least 50 more relocations (11 in 2019). Outback is currently testing multiple design prototypes that modernize the brand and expand the off-premises room to handle higher order volumes. Buffalo Wild Wings’ restaurant of the future showcases a takeout area enclosed separately with its own dedicated entrance. The space features a sauce bottle wall and TVs for guests. Outside there are designated parking spots for off-premises orders. However you look at it, these coming months will be interesting for all sit-down restaurants. Casual dining, like fast food, has often represented the heartbeat of the American consumer. It’s why the segment struggled mightily a few years back when its innovation lagged a shifting guest preference. And it’s why some brands have managed to climb back into positive territory while others still search for fresh ways to grab share. So how do they all stack up: The Harris Poll, in its 31st edition, released its 2019 EquiTrend Brands of Year. It’s based on a sample of 45,541 US consumers ages 15 and over surveyed online, in English, in the month of January. A brand’s Equity is determined by a calculation of Familiarity, Quality and Purchase Consideration. Brand of the Year is determined by a simple ranking of brands. Each respondent was asked to rate a total of 40 randomly selected brands. Each brand received approximately 1,000 ratings. Data was weighted to be representative of the entire U.S. population of consumers ages 15 and over based on age by sex, education, race/ethnicity, region, income, and data from respondents ages 18 and over were also weighted for their propensity to be online. – Source: fsrmagazine.
E-Commerce Turns the Tables on Restaurant Space
Startups offer shared industrial kitchens and warehouses to lure restaurateurs. Honest Burger at work in Deliveroo’s shared industrial-kitchen space in Swiss Cottage, London. The British food-delivery company operates about 30 shared kitchens in several countries. As food delivery expands across major U.S. cities, a handful of startup companies are trying to use the latest e-commerce technology to liberate restaurants and grocery stores from pricey, street-facing retail space. The new breed of startups are opening shared kitchens in industrial buildings, hoping to persuade restaurants to quit their storefronts, move to the new spaces and switch entirely to delivery. Although these companies are still small, some observers say they could leave their mark on the restaurant business and retail real estate. “There’s no doubt the dynamics of the industry have changed significantly,” said Michael Kaufman, a managing director at investment-banking and advisory firm Astor Group and former chairman of the board of the National Restaurant Association. E-commerce already has set off tidal waves in the bricks-and-mortar world. Storefront rents are down, and some mall owners are under financial pressure. Meanwhile, the value of industrial space has been soaring. Now, as e-commerce expands into food delivery, new bets are being made on real estate, and winners and losers are beginning to emerge. In another sign of the shift, some investors are building cold-storage facilities, figuring more people will order their groceries online and demand will increase for places to store perishable food close to big cities. Until recently, restaurants and grocery stores have been among the few sources of strength at shopping centers and malls. But the new startups are trying to change that.
For example, CloudKitchens, a Los Angeles-based venture backed by Uber Technologies Inc. ’s founder Travis Kalanick, turns industrial facilities into shared kitchens, which it sublets to restaurants looking to prepare food for delivery. Entities linked to CloudKitchens have quietly bought at least 10 properties in several major U.S. cities since early 2017, financed with loans from Goldman Sachs Group Inc., property records show. CloudKitchens declined to comment. Other players include Kitchen United Inc., which said it plans to have 10 to 15 locations open by the end of this year alone, and Deliveroo, a British food-delivery company, that operates about 30 shared kitchens in several countries. Food delivery by restaurants is nothing new, of course. It has accounted for a growing part of many restaurants’ revenue as apps have proliferated. But until now, delivery has been unprofitable for many. Profit margins are thin, and the fees paid to delivery apps often eat up what little is left. Proponents of delivery-only kitchens say they can ease this problem because their industrial spaces typically are cheaper than street-facing retail. They also offer flexible lease terms with little need for upfront investments and are designed to expedite delivery, for example, by including ample parking and loading space. The operators lease the kitchens together with utilities, major equipment and in some cases delivery services as well as apps to take orders and help manage the work.
To be sure, the startup kitchen operators face obstacles, including a real-estate market that is seeing plenty of demand from more traditional tenants. When Kitchen United looked to lease its first location in Pasadena, Calif., in 2017, the landlord was initially hesitant because the company had an unproven business model, according to Scott Steuber, of brokerage firm CBRE Group Inc., who helped arrange the deal. The owner ultimately agreed to the deal in part because the space was previously occupied by a cooking school, and the new tenant required little change to the space. Kitchen United’s chief operating officer, Meredith Sandland, said that the company is frequently approached by landlords interested in leasing to them. The rise of food delivery is also increasing demand for cold-storage facilities. In the past, these buildings attracted less interest from investors than traditional warehouses because they were more expensive per square foot, said John Huguenard of brokerage firm JLL. But as prices for traditional warehouses have soared in recent years and e-commerce companies like Amazon.com Inc. have expanded their market share, some investors have seen a similar potential for growth in refrigerated storage. A 2018 study by the trade group Food Marketing Institute and data company Nielsen estimated that 70% of Americans will order groceries online between 2022 and 2024, up from 49% last year. CBRE estimates that this would create the need for an additional 70 million to 100 million square feet of cold-storage space across the U.S. over the coming five years. Real-estate investment adviser BentallGreenOak owns several cold-storage facilities and last year said it was developing a $50 million refrigerated warehouse in Savannah, Ga., in partnership with Bridge Development Partners LLC. The company’s managing director of investments, Steve Reents, said it was particularly drawn to properties close to major cities, in part because of the proximity to food-delivery customers. “We are more likely to do something, say, in urban Seattle near the port than in the central valley of California or Arizona,” he said. – Source: Copyright ©2019 Dow Jones & Company, Inc. All Rights Reserved.
U.S.D.A. Raises Ending Stocks Forecasts for this and Next Year
The U.S. Department of Agriculture, in its July 11 World Agricultural Supply and Demand Estimates report, forecast the carryover of U.S. sugar on Oct. 1, 2019, (2018-19 ending stocks) at 1,761,000 short tons, raw value, up 235,818 tons, or 15%, from its June forecast based on higher tariff rate quota imports and higher imports from Mexico. The U.S.D.A. forecast the 2018-19 ending stocks-to-use ratio at 14.3%, up sharply from 12.4% forecast in June. A bump in ending stocks and in the S.-T.-U. ratio was expected after the U.S.D.A. acted in June to increase the U.S. sugar supply by about 150,000 tons through a T.R.Q. reallocation and an increase in Mexico’s export limit. U.S. beet sugar production was forecast at 4,920,000 tons in 2018-19, unchanged from June, with cane sugar outturn forecast at 4,028,000 tons, down 1,000 tons due to a like decrease in Texas. Imports were forecast at 3,091,000 tons, up 216,138 tons, or 7.5%, from June based on T.R.Q. imports at 1,604,000 tons, up 66,138 tons, other program imports at 400,000 tons, up 50,000 tons, and imports from Mexico at 997,000 tons, up 100,000 tons.
High-tier imports were left unchanged from June at 90,000 tons. Forecast domestic deliveries were forecast at 12,250,000 tons, down 20,000 tons from June based on a like decrease in the “other” category, forecast at 125,000 tons. Deliveries for food were unchanged at 12,125,000 tons (up 0.6% from 2017-18). Exports also were unchanged at 35,000 tons. U.S. sugar ending stocks for 2019-20 were forecast at 1,663,000 tons, up 135,000 tons, or 9%, from the June forecast but down 98,000 tons, or 6%, from 2018-19. The ending S.-T.-U. ratio was projected at 13.5%, up from 12.4% as the June projection. U.S. sugar production in 2019-20 was forecast at 9,260,000 tons, up 121,080 tons from the June forecast and up 313,000 tons, or 3.5%, from 2018-19. Beet sugar production for 2019-20 (from the 2019 crop) was projected at 5,175,000 tons, up 21,000 tons from June, with cane sugar at 4,085,000 tons, up 100,000 tons due to a like increase in Louisiana’s production. Total imports in 2019-20 were forecast at 2,957,000 tons, down 261,872 tons, or 8%, from the June forecast, as a 449,263-ton reduction in imports from Mexico, forecast at 969,000 tons, more than offset a 187,393-ton increase in T.R.Q. imports, based on the announcement of the specialty sugar T.R.Q. Total T.R.Q. imports were projected at 1,568,000 tons for 2019-20. Total supply in 2019-20 was forecast at 13,978,000 tons, up 95,027 tons from June but down 68,000 tons from 2018-19. The U.S.D.A. forecast domestic deliveries of sugar in 2019-20 at 12,280,000 tons, including deliveries for food at 12,175,000 tons, unchanged from June but up 0.4% from 2018-19, and “other” at 105,000 tons, down 40,000 tons from June. Exports were unchanged at 35,000 tons. The U.S.D.A raised its Mexican sugar production forecasts for both this year and next year. Production in 2018-19 was forecast at 6,425,000 tons, actual weight, up 25,000 tonnes from June, and 2019-20 production was projected at 6,248,000 tonnes, up 65,000 tonnes from June but down 177,000 tons from the current year. – Source: Food Business News.
Government Shutdown Leads to Fewer Food Recalls
Food and beverage recalls initiated by the Food and Drug Administration during the first quarter of 2019 fell 36.5% to 99, the second lowest quarter since the third quarter of 2015 and the third lowest total since at least 2010, according to Stericycle Expert Solutions’ Recall Index. Stericycle Expert Solutions attributed the decline primarily to reduced oversight as a result of the government shutdown earlier this year, which stopped or limited many government safety inspections for food and beverages. “While it’s usually good news for consumers when recall rates decline, the Q1 2019 numbers are misleading,” said Chris Harvey, director of recall solutions at Stericycle Expert Solutions. “Fewer inspections mean more potentially dangerous products entered the market unnoticed during this period, which could also have an impact in the months ahead. Having a recall plan in place could never be more important as we track the repercussions.” During the quarter, 30.8% of F.D.A. recalls based on units were due to undeclared allergens, the second consecutive month that undeclared allergens have been the top cause of F.D.A. food recalls and recalled F.D.A. food units. Foreign material accounted for 30.8% of F.D.A. recalls, and no inspection was 17.9%. The top food categories based on recalls was prepared foods, at 24, followed by produce (12), baked foods (11) and dairy (9). The top U.S. Department of Agriculture category based on recalls was poultry, at 41%. It was followed by pork, at 23.1%; seafood, 15.4%; beef, 10.3%; and multiple, 10.3%. According to Stericycle Expert Solutions, 17.2% of the F.D.A. food recalls were of products that had been distributed nationwide, which marks the second highest percentage since the fourth quarter of 2016. – Source: FoodBusiness News.
The Benefits of Outsourcing Sanitation Services
Operators of processing facilities might encounter any number of reasons for not tackling the sanitation shift in-house. Whether the reasons stem from environmental issues, microbiological, staffing, leadership or otherwise, the benefits of outsourcing sanitation services are many. Packers Sanitation Services Inc. (PSSI) provides contract sanitation services to processing plants facing issues which keep them from using in-house staff or hiring for sanitation purposes, and a recent rebranding campaign suggests a trend in the industry that has positioned PSSI as a multi-dimensional food safety partner rather than just a sanitation contractor. PSSI employs many different teams to handle and monitor any given situation. These teams transcend simple sanitation crews tasked to clean facilities. Regarding the brand relaunch, Timm Miller, director of corporate accounts, said, “Along with that, we’ve bolstered our teams. So, we have a dedicated food safety team with microbiologists. A dedicated safety team that believes in our company culture of safety not being a trade secret.” PSSI conducts webinars and publishes thought pieces concerning safety in the workplace intended to benefit the industry as a whole, not just the company and its subsidiaries. “We also have an open safety summit every year where we bring in industry experts from outside PSSI as well as internal people and provide a very robust program around building safety programs at a facility,” Mr. Miller said. Most recently, PSSI launched Realtime Performance Metrics (RPM). The tablet-based program provides real-time data on key metrics related to sanitation. “Maybe you lose water pressure during the course of the evening,” Mr. Miller said. “We’re able to track that and send updates to the facility via tablets and say, ‘we’re having water pressure issues.’ We’re able to correlate all these metrics at the end of the shift back to the problem and suggest strategies to alleviate those problems on the next sanitation cycle or the next day or night. It’s a unique tool to the industry.” PSSI’s Field Audit Support Team (FAST) is another value-added service outside of the company’s deployment of sanitation crews. The FAST team focuses on regulatory issues, which sometimes change daily and make it difficult for processors to stay up to date on. The FAST team will micro sample and analyze around what the nature of sanitation is at any given facility and guide the sanitation crews for that facility. “And the FAST team is deployed to customer locations to help provide mitigation strategies if a problem does occur,” Mr. Miller said.
Every processing facility will differ from another in some way. Even facilities owned by the same company, processing the same products from the same species using the same equipment will vary. The age of the building, the size of the building or weather factors can potentially change from one facility to the next. “Whether it be a microbiological issue or an environmental sanitation issue, or it could be related to labor problems or leadership problems,” Mr. Miller said. “Every facility you walk into is going to be a little bit different from the last.” Additional variables dictate customized programs for each customer and situation. A plant might lack enough hot water or have no hot water at all. It might not create enough water pressure to fulfill the sanitation needs. There could also be an issue of time management within the time available to clean. Miller says so many factors go into putting together a program that customization is the only way. “There really isn’t a menu,” he said. “The program that we offer is very comprehensive in that we’re providing the labor, materials and management dedicated to each facility. So, they are there on a daily or nightly basis.”
The roadmap to a solid sanitation strategy for any processing plant starts with an understanding of the plant’s needs and goals. It’s important for plant operators to be a part of creating that roadmap. Plant operations lay out the directives they want PSSI to accomplish, such as areas to look at and areas to leave out. “We develop a plan based on how much labor we’re going to need, how much supervision we’re going to need, the type of tools and chemistry we’re going to need to get the job done safely with high integrity and correctly,” Mr. Miller said. Once plant operations and PSSI collaborate on a plan, PSSI sends in a team of experts in multiple disciplines to assess the overall cleaning/sanitation situation of potential customers’ plants. The team will spend one to three days on the assessment, maybe more depending on the size and scope of the project. The average team would consist of operations people who have experience in the implementation of programs, technical services personnel and food and worker safety experts. “These all fall under what we call our technical services management,” Mr. Miller said. All personnel are PSSI employees. The company does not use sub-contractors. “We have in-house safety experts, food safety experts, microbiologists, continuous improvement management, or continuous improvement representatives, and we also bring in chemical representatives,” Mr. Miller said. Well equipped PSSI’s ability to tackle the multitude of different problems usually occurring in processing facilities is linked to its experience-based preparedness. The company has cleaned and sanitized plants since 1972 and currently services more than 500 facilities in the U.S. and Canada with approximately 17,000 employees. Along the way, it has obtained and developed departments and teams to address issues encountered over the years. “We are pretty well equipped,” Mr. Miller said. “We have our chemical manufacturer, which is wholly owned by PSSI and we have an engineering group that designs and builds equipment to fit the needs of the facility. So, if they need additional high pressure, or we’ll just say additional water pressure, we’re able to bring in the equipment or build the equipment to solve that issue.” While an in-house chemical supply and engineering and fabrication team can’t help in situations that call for the cutting of concrete or the relocation of drains, it’s still and advantage when addressing those issues. Those types of constraints at a facility need a different type of contractor, but the resources PSSI brings to the table do allow options. “Those are the sort of things you run into,” Mr. Miller said. “To provide solutions around that, we have to get creative. If we’re having trouble with water, for example, drains taking water to the wastewater system or drains flooding or collapsed drains, the first mitigation step is reducing water use and finding ways to reduce water use. The second is trying to contain or working to contain the water so it eventually does drain and doesn’t flood a facility.” The company has pumped water from a non-functioning drain to a functioning one. There are also situations, especially in older facilities, that simply require a repair or rebuild from a specialized contractor. “We work around it,” Mr. Miller said. “We do make those recommendations, absolutely. But we do work around it. I’ve been in a number of facilities where drain work, that type of work is required. For example, when you get into some of these older facilities there might be a wall that has gaps in it that can harbor microbiological growth. We make recommendations to fix those areas, but in the interim we find novel ways of cleaning to make sure that we can keep the issues at bay or mitigate.” – Source: Food Business News.
How MOD Pizza Built the Nation’s Fastest-Growing Brand
Scott and Ally Svenson knew what they were getting into when they created MOD Pizza. The Seattle natives had found their knack for the food business when they started London-based Seattle Coffee Company (eventually acquired by Starbucks) and honed it while helping to build the Italian brand Carluccio’s. Their itch to create MOD Pizza back home in Seattle came just as the fast-casual industry started to gain traction. And now, with more than 400 locations across 28 states and the U.K., Scott and Ally are the leaders behind the nation’s fastest-growing fast-casual brand. The Svensons imparted the crucial business skills they learned along the way on the latest episode of QSR’s podcast, “Fast Forward.” Something’s brewing. When Ally moved to join Scott in London in the early ’90s, she was less than impressed with the U.K. She started a list of things that she missed from the U.S., and on the top of the list was high-quality, Seattle-style coffee. The Svensons spent four years debating what to do with their dilemma, including reaching out to Starbucks about helping it open in the U.K. “We just wanted to get a great cup of coffee, and we called them. They ended up going to Japan first,” Ally says. Starting a business in a well-established market like London was intimidating. But the Svensons took the leap after a friend proposed an ultimatum to either start a business or leave London. So the pair opened the Seattle Coffee Company in 1995. Even then, they had trouble finding the proper supplies for high-quality coffee—not to mention an audience. A line scribbled on a sticky note helped to keep the business centered as it grew. “It simply said, ‘Our goal is to create a Seattle-style coffee bar that would fool a Seattleite,’” Ally says. Keeping a brand message has been a staple for their business practices ever since.
Pizza with purpose. The Seattle Coffee Company grew to 70 locations in the U.K., along with several international locations, by the time the Svensons sold to Starbucks. They’d looked up to Starbucks as a role model for their own business and were excited to see the inner workings of an established machine. But after working alongside the Starbucks team for a short period, the Svensons opted to leave the coffee business behind. “After being inside a Starbucks for a while managing a bigger business, we realized we wanted to get back to building,” Scott says. The Svensons then spent 11 years building a U.K.-based Italian concept called Carluccio’s alongside its founders. Along the way they learned Italian food trends, and realized it was one of the largest restaurant categories in the U.S. but had virtually no innovation in a generation. “Meanwhile, you’ve had the rise of the fast-casual service model that has really brought different food categories to consumers in a new, accessible, more relevant way for today’s lifestyles,” Scott says. “We started this exploration of what it would look like to bring the fast-casual model to pizza.” Like their first business, the Svensons developed MOD when they realized there was a hole in the market that could be filled. “Sometimes, like coffee in the U.K., it’s the simple insights that matter,” Scott says.
Outside the box: Ally and Scott pride themselves on MOD’s dedication to great service and quality. When the first restaurant opened in downtown Seattle during the recession, in 2008, great service and quality were desperately needed. “It needed to be a welcoming, friendly, affordable place. And we needed to be giving people secured, reliable jobs at a time when people are job insecure and financially insecure,” Ally says. Part of that mission includes hiring individuals who typically have barriers to employment, particularly second-chance hires. The Svensons also strive to guarantee that customers will enjoy their pizza by whatever means necessary. In fact, in its first five years, MOD only grew to 12 locations because the team was busy tweaking the concept to prepare it for expansion. The Svensons say their drive to grow MOD is rooted in a desire to have a social impact. The brand’s unusual aim to use pizza as a means rather than an end signals the company’s commitment to its mission. “The importance of authenticity cannot be understated,” Ally says. “Because if things are being created and done from an authentic place, there’s just more of a conviction—it’s something that’s meant to be.” – Source: QSR magazine.
Subway Plans to Remodel 10,500 Locations
Subway and its vendors are expected to provide franchisees with more than $100 million in grants to help fund remodels to about 40% of the chain’s units over the next year and a half, the company said. The Milford, Conn.-based sandwich giant, along with its vendors, is providing operators with $10,000 grants to help spur remodels. The grants fund about 25% of the cost of the remodel, the company said. Subway said that 10,500 of its nearly 25,000 U.S. locations expect to take advantage of the program and get a new look by the end of 2020. The company has remodeled 1,400 locations worldwide, with another 900 underway, the company said. Add it all up, and Subway, its vendors and its franchisees are investing a total of $400 million into remodels over the next 18 months. “By signing up for the remodel program, the franchise owners are making an investment, and showing their trust in the brand,” Chief Development Officer Don Fertman said in a statement. Subway is undertaking a significant effort to transform its image and its stores as the company looks to recover from a six-year sales slump. System sales declined 3.6% in the U.S. last year to $10.4 billion, according to data from Technomic’s Top 500 Chain Restaurant Report. Unit count declined by 4.3%. The chain has shed more than 2,300 locations domestically since it hit a peak of 27,103 locations in 2015. The company is also fending off controversies inside its franchise operations. The New York Post detailed how Subway will put operators out of business over small violations of the franchise agreement, and the New York Times revealed that development agents will determine operators and take over their stores themselves. Subway is investing heavily behind its improvement efforts, however. In addition to the grant program, the company spent $800 million last year to enable operators to add new beverage stations and sauce options. The company has also made numerous innovations on its menu, adding new wrap sandwiches and Cheesy Garlic Bread. It is also testing sandwiches made with King’s Hawaiian bread and milkshakes made with Halo Top ice cream. The company is also aggressively adding delivery at its U.S. restaurants as it works to compete with smaller sandwich shops Jimmy John’s, Jersey Mike’s and Firehouse Subs, all of which have taken market share in recent years. Source: Restaurant Business on-line.
Bonchon Names Flynn Dekker CEO
Bonchon has appointed Wingstop veteran Flynn Dekker as its CEO, the Korean fried chicken chain’s board said. Dekker replaces Bonchon founder Jinduk Seo, who remains a shareholder and will continue to be a member of the board of directors. VIG Partners, a private-equity firm based in Seoul, South Korea, acquired majority control of the company in December 2018. “The board and I are confident that Flynn is the right person to build on the growth and momentum Bonchon has built in the United States and worldwide,” said BM Park, a managing partner at VIG. “He is a seasoned leader with significant experience working with multi-unit restaurant concepts on operational efficiencies, revenue generation and delivering value to franchisees and equity holders,” Park said. “We are thrilled to have him as our new CEO.” Dekker most recently was chief marketing officer of Dallas-based Wingstop Inc., a position he’d held from 2014 until his departure in 2018. He also worked at Rave Restaurant Group, Metromedia Restaurant Group, Fogo de Chão, FedEx Office, EMI Music, Pizza Hut and Blockbuster. He owned an upscale restaurant, Horne & Dekker, in Dallas from 2010 to 2012. Dekker in a statement said he had long been a fan of the fried chicken chain, which now operates 345 locations worldwide, including 92 restaurants in the United States. “My passion for Bonchon began many years ago when I discovered the brand on a trip to New York City,” he said. “Bonchon’s commitment to serving a unique, quality product combined with its loyal, worldwide fan base and talented team are just some of the reasons I am excited to be leading the brand.” Dekker added that he sees a lot of room for the chain to expand. “There is a lot of white space for Bonchon to grow as we introduce our signature fried chicken to more franchisees and consumers in markets across the world,” he said. “Our goal is to have one of the best investment ratios in the business driven by our continued commitment to our passionate base of fans.” Bonchon opened its first U.S. restaurant in 2006, featuring Korean-style fried chicken, which is dusted in cornstarch and double-fried. – Source: NRN.
Boston Market Shutters 10% of Stores
Boston Market said that it has closed 45 stores, or about 10% of its 454-unit system, due to store underperformance, according to a letter circulated by CEO Frances Allen to employees. The Golden, Colo.-based chain owned by Sun Capital Partners Inc., closed six restaurants on June 30, while the remaining 39 closed on July 7. “We must take steps to ensure our operational structure will support long-term sustainability,” Frances Allen said in the letter. “Part of that effort involves continuously analyzing our geographic footprint and real estate portfolio to assess the ongoing viability of locations. The dynamics of geographic areas can change dramatically over time, sometimes impacting the performance of a location.” The Boston Market system had reported U.S. sales of $557.8 million from 454 U.S. units, including 435 company restaurants, for the fiscal year ended in December 2018, which was down 1.3% from $565.3 million in system sales and 461 locations, including 443 company units, in fiscal 2017. In terms of the parent company’s estimated U.S. revenue from company-restaurant sales, initial franchise fees and franchisee sales royalties, Boston Market had fiscal 2018 revenue of $546.5 million, which was down 1.7% from fiscal 2017’s estimated U.S. revenue of $555.7 million. The news comes shortly after Boston Market announced a new menu direction in June in an effort to shake up summer sales, including four different summer rotisserie chicken sandwiches. The menu change was part of a “multi-faceted transformation plan” that was meant to improve the chain’s competitive edge in the market and improve “brand relevance through re-energized marketing efforts.” Another Sun Capital Partners division, Restaurants Unlimited Inc., a 35-unit, Seattle-based restaurant company that owns brands including Kincaid’s, Palomino and Henry’s Tavern, filed for bankruptcy protection on July 8. At Boston Market, Allen said that all displaced employees would either receive employment opportunities from other stores or would receive a severance package. “Our success is not going to be measured by the number of stores; it’s going to be driven by and measured by our ability to execute on our agenda,” Allen concluded in her letter to employees. – Source: NRN.
McDonald’s Veteran Jim Norberg Named to Position
Papa John’s International Inc. has appointed Jim Norberg as the company’s first chief restaurant operations officer, the company said. Norberg, who had served as chief operating officer at McDonald’s USA until 2015, will oversee the operations of corporate and franchise stores for the Louisville, Ky.-based quick-service pizza brand. “Jim has an impressive growth track record, as well as deep-rooted QSR industry knowledge and expertise, making him a welcome addition to our talented leadership team,” said Steve Richie, Papa John’s president and CEO, in a statement. “Jim is a seasoned expert whose depth and understanding of restaurant operations and the guest experience will help propel our brand forward and position us for continued success.” In his previous role with McDonald’s, Norberg worked to unify franchise and company store operations and helped to simplify systemwide menus and operations. Under his new role, Papa John’s said Norberg will work to deliver increases in sales, customer satisfaction and profit margins for both corporate and franchise stores. “I am thrilled to be joining such a strong and talented leadership team and the Papa John’s family,” Norberg said in a statement. Norberg will join two other notable company appointments, including Marvin Boakye, who was named as the company’s first chief people officer in January, in efforts to improve company culture following the controversy concerning former Papa John’s CEO John Schnatter. Former NBA star and entrepreneur Shaquille O’Neal also joined the company earlier in 2019 as an executive board member with a three-year product endorsement deal. – Source: NRN.
Struggling Kona Grill Sold for $20.3 Million
Struggling Kona Grill has a new owner, although it’s far from a stranger. The Scottsdale, Arizona-based brand was dealt to Williston Holding Co. Inc., the company founded by Marcus Jundt. He is one of the polished chain’s founders and served on the board from 2000–2009. Jundt also held the CEO post twice—from 2006–2009 and then for a few months last year. He resigned in March. Jundt’s Williston company, which operates out of Houston, paid $20.3 million in cash for the brand. WHC will also take on more than $5 million in liabilities. In April, Kona Grill filed for Chapter 11 bankruptcy protection in United States Bankruptcy Court for the Delaware District. The company said it had assets of $53.6 million and debts of $74 million, and just $1.2 million in cash on hand. Also per the filing, Kona Grill closed 15 more restaurants and was down to 27 units. There were 34 locations in 20 states when the company filed its annual report in April. Kona was scheduled for an auction July 23. However, only one entity—WHC—submitted a “stalking-horse” bid in May. The company isn’t quite buying the entire brand. The deal is for 24 of the 27 locations. It’s not clear yet which stores are involved. Per court proceedings July 25 in Delaware, WHC will keep Kona Grill running and plans to work with the same vendors and partners. The brand’s attorney said 2,300 employees would be transferred to WHC upon close. WHC is a restaurant operator and franchisor with 10 concepts, including fast casual Überrito, Tortuga Mexican Kitchen, and Williston Brewing Co. In addition to Jundt, former CEO Berke Bakay is involved. Bakay, who led the brand from 2012 to 2018, helped WHC in its negotiations with Kona Grill and loaned the company $2.03 million through his BBS Capital Fund L.P. He became a member of WHC’s board of directors as well. Bakay’s time with Kona Grill was one of its most lucrative. The brand’s stock more than quadrupled in the three years after he was named CEO. as the Phoenix Business Journal pointed out, little, if any, of the $20.3 million Kona gets in the deal will make it to shareholders. That’s something the company warned in the spring. KeyBank National Association, which held a large portion of Kona’s debt, will earn more than $16.5 million from the sale. The brand owed more than $74 million to a total of 13,545 creditors when it declared bankruptcy. The majority were vendors and landlords. Kona Grill’s sales slid into the chapter 11 filing. Same-store sales dropped 12.3 percent in 2018 after declining 5.9 percent in 2017. This after six consecutive years of comparable restaurant sale increases. Revenue fell 12.4 percent in the fiscal year that ended December 31, year-over-year. Kona Grill swung a net loss of $31.968 million last year compared to $23.432 million the previous year. That’s 20.4 percent of restaurant sales. Average-unit volumes dropped to $3.492 million in 2018 from $4.119 million the previous year. EBITDA was negative $15.9 million. Before its bankruptcy filing, Kona Grill named Jonathan Tibus, managing director with turnaround firm Alvarez & Marsal, CEO, effective April 17. He previously served as CEO of Real Mex Restaurants (Chevy’s, El Torito, Sinigual, and Las Brisas), and led the since dissipated Ignite Restaurant Grouo (Joe’s Crab Shack and Brickhouse Tavern) and Last Call Operating Co. (Fox & Hound, Champps). All of those companies filed for bankruptcy protection. Tibus also served as chief restructuring officer at Quiznos, a quick-service brand that emerged from bankruptcy in 2014, and chief operating officer of Max & Erma’s, which filed for chapter 11 protection in 2009 and nearly shuttered all of its restaurants. – Source: fsrmagazine.com.
UPS Has Been Delivering Cargo in Self- Driving Trucks for Months and No One New
UPS announced that its venture capital arm has made a minority investment in TuSimple. The announcement also revealed that since May TuSimple autonomous trucks have been hauling UPS loads on a 115-mile route between Phoenix and Tucson. UPS confirmed to Gizmodo this is the first time UPS has announced it has been using TuSimple autonomous trucks to deliver packages in the state. Around the same time as the UPS and TuSimple program began, the Unites States Postal Service and TuSimple publicized a two-week pilot program to deliver mail between Phoenix and Dallas, a 1,000 mile trip. TuSimple claims it can cut the average cost of shipping in a tractor-trailer by 30 percent. In an announcement about the new partnership, UPS Ventures managing partner, Todd Lewis, said the venture arm “collaborates with startups to explore new technologies and tailor them to help meet our specific needs.” UPS would not share the terms of the deal with Gizmodo. TuSimple did not immediately respond to a request for comment. As the Verge reports, TuSimple puts its own autonomous tech—which relies on nine cameras and two LIDAR sensors—in Navistar vehicles. The partnership announcement states that TuSimple has been helping UPS understand how to get to Level 4 autonomous driving where a vehicle is fully autonomous and able to reach a particular location. At this point, the TuSimple trucks carrying packages for UPS still have an engineer and a safety driver riding along. When UPS reaches Level 4, it won’t need anyone behind the wheel. – Source: GIZMODO.
New York State Regulators Capping Commissions
New York state regulators have called for capping the commissions paid by full-service restaurants to third-party deliverers at 10%, a major first step in regulating the fees charged by the services. The New York State Liquor Authority (NYSLA) issued what’s called an advisory to its leadership, asking them to take up the matter during a meeting on Aug. 20. The advisory asserts that commissions paid by restaurants with a liquor license be capped at 10%, consistent with state law that demands businesses sharing in the profits of a permitted establishment be vetted by the NYSLA and added to the permit, a time-consuming and potentially costly process. The major exception are landlords, who can charge up to 10% of a full-service place’s gross profits as part of its rent. The NYSLA suggested that places serving liquor be forbidden to pay more than the same percentage to the delivery services. The threshold would hold across all orders delivered from a licensed restaurant, even if beverages are not allowed. Delivery of alcohol from restaurants is currently illegal in New York. The way the proposal is phrased, the law would prohibit the licensed establishments from paying more than 10%, instead of mandating that the delivery services not charge a higher percentage. But paying anything more than that amount would be illegal per se, suggesting a higher charge could be refused by the establishments. “The onus will be on industry members to notify companies like Grubhub-Seamless that they will have to lower their percentage rate to come into compliance with the advisory once it is adopted, if they wish to keep doing business with you,” Robert and Max Bookman of Pesetsky and Bookman, the legal counsel of the New York City Hospitality Alliance, wrote in an explanation blasted to the association’s membership this afternoon. In addition, “if your business does not sell alcohol, you will not benefit from the advisory,” they said. Nor would the fee structure likely change for places that pay a flat per-fee for deliveries made by a third party. Still, the advisory is seen as an important first step in curbing practices that have drawn fire from restaurateurs and government officials such as Mark Gjonaj, chairman of the Small Business Committee of the New York City Council. “The committee is closely watching the advancement of the New York State Liquor Authority’s proposed advisory,” Council Member Gjonaj said in a statement provided to Restaurant Business. “If adopted, the advisory will only impact restaurants that have liquor licenses.
Thus, the committee will continue its work to establish a comprehensive solution that levels the playing field for all of New York’s locally owned restaurants.” In hearings conducted in late June, Gjonaj’s committee focused on such controversial practices as cybersquatting, or setting up websites that masquerade as a restaurant’s internet page, and levying fees on restaurants when customers call a third party to seek information instead of placing a delivery order. The Hospitality Alliance’s lawyers wrote, “this would be a major and positive change for our industry, as we currently suffer from unfair demands from companies like Grubhub-Seamless to hand over exorbitant percentages of our sales. The advisory would go a long way to curbing this unfair business practice.” The NYSLA warned that action on the fees may not happen quickly. Members of the authority are expected to defer a vote on the advisory until comments can be solicited from the public and businesses with a stake in the matter. New York is the nation’s fourth-largest restaurant market, behind California, Texas and Florida. It’s Friday, a few hours from the dinner service you simultaneously love and hate. The restaurant will almost certainly be slammed. With the surge in traffic comes a slew of operational questions, not to mention a frantic, exhausting stretch. Are there enough employees on shift? Enough burger patties in stock? All the big-brand bottled beer needed to make that week’s usual sales and profits? What are those “usual” sales and profits, anyway? – Source: Restaurant Hospitality.
Will Re-Usables Replace Disposables for Takeout?
It’s going to be a big year for re-susables. As Lawmakers make it easier for restaurants to handle reusable containers brought by guests, a growing number of companies are racing to create systems where durable, washable cups and containers replace the ubiquitous single-use disposables upon which takeout now relies. These young players compare themselves to the bike-share companies that are becoming ingrained in urban culture. Essentially, these companies want re-usables to become like library books of foodware — they can be used, returned, washed and used again hundreds of times — eliminating the need for cups and containers that may or may not be recycled or composted and often end up in the trash. It can also potentially save restaurants money, reducing the need to purchase disposables and cutting trash-hauling bills. Restaurant operators are already up against mandates to reduce their packaging waste in cities like Berkeley, Calif., and such laws are expected to spread. – Source: Restaurant hospitality