To Our Valued Subscribers:

Here it is the beginning of February and we have a new Superbowl Champion. Congratulations to the Kansas City Chiefs and all of you who wagered and won. (Approximately $6.8 Billion over 26 million Americans placing bets!!) We also have a robust economy and no Fed rate changes. A great time and a difficult time to be in in our industry. The difficult part is finding the talent to help you grow. According to a recent study conducted by Silkroad and Career Builder, 60% of employers say it is taking them much longer than last year to fill openings. The study does offer a few tips so you can speed up the process, and I’ll share a few of them with you; however, if you want immediate results contact me or my colleagues at American Recruiters and we will do everything to find you that stealth candidate who could be your game changer. All it takes is a phone call or an email to give you and your organization a competitive advantage and it cost you $0 if we don’t deliver. (Better odds than your Superbowl wager.) So, pick up your phone or send that e-mail, Now here are a few tips:

• Separate your wants from your needs: Consider the role for which you’re hiring, and then look at your requirements. Are these truly “must-have” qualifications, or is there wiggle room? Does a candidate need every single one of these skills coming into the job, or can you train them once hired? If you can cut back on some of your job requirements (and are willing to train on the job), you will significantly widen your pool of potential applicants.
• Think outside the ZIP code With a remote workforce, you can recruit talent from anywhere in the world, while saving your company the costs of office space, turnover and absenteeism, etc.

Enjoy the latest edition of American Recruiters Global Foodservice News, while I pay off my wager.

Craig Wilson

President

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Impossible Burger Ingredient Keeps F.D.A. Safety Status 

The Food and Drug Administration continues to assert that soy leghemoglobin remains safe for use as a color additive in ground beef analogue products, which includes plant-based Impossible Burgers. The F.D.A. on Dec. 17 said it concluded objections raised by the Center for Food Safety did not justify a hearing or provide a basis for revoking the safety assessment. Impossible Foods, Inc., Redwood City, Calif., in 2018 filed a color additive petition for the safe use of soy leghemoglobin as a color additive in ground beef analogue products such that the amount does not exceed 0.8% by weight of the uncooked product. The F.D.A. in the Aug. 1 issue of the Federal Register published a final rule that added soy leghemoglobin to the list of color additives exempt from certification. Impossible Burgers are sold in more than 17,000 restaurants nationwide and are found in grocery stores, too, according to Impossible Foods. Burger King worked with the company to offer the Impossible Whopper. The Center for Food Safety, a national non-profit public interest and environmental advocacy organization based in Washington, raised six objections to the final rule. After a thorough review of the objections submitted in response to the final rule, we have concluded that they do not provide any substantive evidence to cause us to change our determination of safety for the use of soy leghemoglobin as a color additive in ground beef analogue products,” said Dennis Keefe, Ph.D., the F.D.A.’s director of the office of food additive safety, on Dec. 17.

The F.D.A. responded to all six objections. First, the F.D.A. should have sought additional safety testing and public comment before approving the color additive for ground beef analogues that are not plant-based, according to the Center for Food Safety. The F.D.A. responded that Impossible Foods addressed the safety of soy leghemoglobin, including any potential allergenicity, by using the weight-of-evidence approach, which is based on several elements such as the known function of the protein and its history of exposure, whether the protein is from a toxigenic or allergenic source, and the digestibility of the protein. “Furthermore, we are not aware of any scientific evidence that suggests a food matrix, whether plant-based or animal-based, would modify the structure, function, or safety of soy leghemoglobin under the conditions of its intended use,” the F.D.A. said. Second, the Center for Food Safety said the F.D.A. should require labeling the color as soy leghemoglobin/P[ichia] pastoris yeast protein, saying that such information would be vital for consumers who have allergies to soy products or yeast products. The F.D.A. said foods that contain soy leghemoglobin must be labeled accordingly since soybeans are a major allergen. Yeast protein, however, has not been identified as a major allergen. Third, the F.D.A. should have required additional testing of the raw product. The F.D.A. in response noted submitted safety studies were conducted using raw soy leghemoglobin preparations. Fourth, the F.D.A. independently should have verified the safety of soy leghemoglobin. The F.D.A. said it disagreed that the F.D.A. should conduct its own safety studies. Manufacturers or their paid contract laboratories mostly conduct studies that demonstrate the safety of food ingredients. Fifth, the F.D.A. should have required separate testing of P. pastoris since it is genetically engineered. The genetic engineering of P. pastoris produces soy leghemoglobin. The F.D.A. responded that all the safety studies contained both the soy leghemoglobin protein and the P. pastoris proteins. Thus, no additional testing of a P. pastoris strain was needed. Finally, the F.D.A. violated the National Environmental Policy Act by failing to prepare an environmental assessment or environmental impact statement, according to the Center for Food Safety. The F.D.A. responded that the Center for Food Safety provided no data or information to support the contention that approving soy leghemoglobin as a color additive would lead to an increase in the cultivation of genetically engineered soybeans, that such cultivation would result in an increase in pesticide use such as dicamba, or that cultivation would result in significant adverse impacts to threatened or endangered species or their habitat. – Source: Food Safety Monitor.

Bar Louie Shutters 38 Restaurants as it Files for Bankruptcy 

Over the past few years, Bar Louie primarily drove sales and profit through new-unit expansion. But a problem emerged along the way. It funded growth partially through new debt, yet also with cash flow from operations. And, eventually,  didn’t have enough cash on hand to fix underperforming units when they started to drag the system. The result, it said Monday, was an “inconsistent brand experience,” resulting from restricted liquidity otherwise needed for store refreshes, equipment maintenance, and modernization. Couple that with “increased competition and the general decline in customer traffic visiting traditional shopping locations and malls,” and Bar Louie filed for Chapter 11 bankruptcy protection following the closure of 38 of its 134 restaurants.

The chain, a holding of Sun Capital Partners, has multiple buyers interested in the business, it said in a filing. Bar Louie reached an agreement with lenders to act as the “stalking horse” purchaser and to support business through a Chapter 11 bankruptcy sale. The company did not identify bidders, just noting that three suitors submitted letters of intent in December. Higher offers can still come in. “Stalking horse” bidders set the floor for the price in exchange for having their fees paid if another company swoops in. Outside of the closures, the company said it does not expect the bankruptcy filing to have a meaningful impact on day-to-day operations and that it shut down the underperforming stores to “strengthen its operational and financial position.” Bar Louie’s voluntary petitions for relief under Chapter 11 protection will aid the sales transaction. It also received commitments from lenders for debtor-in-possession financing, the company said, to continue operations and fund post-bankruptcy operating expenses, including obligations to employees and suppliers. “Bar Louie is a profitable business focused on long-term growth with new investors. The sale through Chapter 11 will help us to focus on our profitable core locations and expand in areas that have a proven track record of success,” Tom Fricke, CEO of Bar Louie, said in a statement. “Most importantly, it ensures that we can continue to provide superior service to our guests, implement an exciting range of new customer-facing initiatives, expand our marketing influence, and continue to offer the 5-star experience we are known for.” The company added it expects to emerge from the Chapter 11 process within 90 days.

According to the filing, Bar Louie reported assets between $50 million and $100 million and owes roughly $110 million to creditors. Sysco holds the biggest unsecured claim at $3,046,275.52. Bar Louie said traffic declines were more pronounced at stores near shopping locations and malls, which led to sales falling short of forecasts. “These customer declines were also driven by major changes in consumer behavior, including the general national trend away from casual dining,” it added in the filing. Same-store sales declined 4.2 percent in 2019. Bar Louie’s revenue for the 12 months ended December 31 was $252 million, down 3.7 percent, year-over-year. In 2018, it hired a new CEO (Fricke) and assembled a fresh management team. The company then outlined a turnaround strategy centered on improving guest experience through better customer service and store maintenance; improving food quality to better complement its beverage program; and redefining Bar Louie’s brand essence by developing a new advertising campaign. Some current directives include its Louie Nation Loyalty Program; the construction of private dining rooms where feasible; adding covered patios to limit the impact of weather on outdoor seating areas; the implementation of store-level party planning sales managers; and corporate gift card partnerships. Bar Louie said initiatives positively impacted performance in 72 of its 110 corporate locations. “However, despite successful execution of these programs, 38 of the locations have seen their sales and profits decline at an accelerating pace,” the brand said.

The declines forced a reduction of expenses and other investments, “with the inevitable impact being felt throughout the whole system.” And that’s where the lack of available liquidity came into play. Despite the success of the initiatives, Bar Louie said, not having investable capital on hand “resulted in delays to the broader roll out of these initiatives to other locations and curtailed the ability to implement further marketing related activities compared to others in the industry,” leading to the same-store sales drop. The 38 underperforming locations generated a loss of $4 million in 2019. “Further, the surrounding environment at these locations has seen significant declines in customer traffic and coupled with increasing rental and other store level costs, could no longer absorb the continuing decline in sales at these locations,” the company said of the closures. Those restaurants reported same-store sales declines of 10.9 percent in 2019. The rest of Bar Louie’s corporate system witnessed a 1.4 percent drop. The brand said the bulk of its sales declines occurred in Q4 2019 “when financial conditions and a lack of liquidity forced management to significantly reduce marketing spend.” Bar Louie engaged Carl Marks Advisors in September to conduct a strategic review of the business. It also brought on Configure Partners, LLC that month as its proposed investment banker to assisted in the evaluation of strategic alternatives, including the sale of the company. Bar Louie tapped Howard Meitiner of Carl Marks as its chief restructuring officer, effective January 23.

As of the filing, Bar Louie said it contacted 101 potential strategic buyers and 153 financial buyers, out of which 73 executed confidentially agreements. The company received initial indications interest from seven potential buyers and engaged in additional discussions, including management presentations, in Dallas. From that group of seven, three parties submitted letters of intent in December. However, during this process, Bar Louie “continued to suffer a drain on cash flow from its underperforming stores.” It became apparent the company’s liquidity position would require the sale process continue in a Chapter 11 setting. Bar Louie closed the 38 unprofitable locations immediately preceding the filing “after unsuccessful attempts to reduce store-level costs and drive sales.” The chain employs about 4,141 full-time and part-time hourly people, 370 full-time salaried workers, and 55 salaried employees at its corporate headquarters in Addison, Texas. The filing did not address the status of Bar Louie’s 24 franchised locations. Bar Louie was founded in 1991 in Chicago and grew to 31 stores by 2010, when it was acquired by its current owners. From 2010 through the end of 2019, it expanded to 110 company-run units and 24 franchises in 26 states. The company’s gastrobars are located in a variety of locations, including lifestyle centers, traditional shopping malls, event locations, central business districts and other stand-alone specialty sites. – Source: fsrmagazine.

Village Inn Owner Declares Bankruptcy 

American Blue Ribbon Holdings shuttered 33 locations and filed for Chapter 11 bankruptcy protection Monday, the company announced. The filing does not involve or affect the operations of O’Charley’s or 99 Restaurants, which are not part of ABRH (a company separate from American Blue Ribbon). Fidelity Newport Holdings owns ABRH, which owns American Blue Ribbon Holdings. American Blue Ribbon oversees Bakers Square and Village Inn, the two chains involved in the bankruptcy. The company said reorganization will facilitate its “Village Inn and Bakers Square restaurant brands evolution to a healthy core of restaurants and support an approach to the brands that is most beneficial for all stakeholders.” “As part of the reorganization, the company will explore a variety of strategic and structural initiatives to best position the company for success in the future,” it added. The company also noted it arranged debtor-in-possession financing of $20 million from Cannae Holdings, Inc., its majority equity owner, in support of the filing and plan of reorganization. American Blue Ribbon added that Legendary Baking will continue its current operations “in the ordinary course.” The brand sells more than 25 million pies annually and, with the financing, will be able to “conduct its business without interruption.”

In a release, the company said financial trends have tracked negative 2017 as restaurant operations struggled with declining sales and acceptable margins. It called out “higher wage rates,” as a main culprit. In filings, the company said rising labor costs counted for a $2 million impact in the past two years. “Dramatic increases” were seen in 67 of American Blue Ribbon’s then-130 restaurants, located in Minnesota, Colorado, Illinois, and Arizona. Additionally, American Blue Ribbon had an increasing number of unprofitable restaurants due to, among other things, “unfavorable trade area locations and above-market rents or otherwise high occupancy costs.” The company credited “an increase in convenience via takeout and delivery” for declining dine-in traffic as well. During 2018, a potential transaction to separate American Blue Ribbon Holdings’ business from existing equity ownership was proposed but ultimately did not occur. At that point—Q3 of 2018—both brands had new leadership. In that year, ABRH and other non-debtor affiliates assisted the company in funding its operations. Last year, in order to support operating losses, American Blue Ribbon closed and sold its support facility in Denver, shuttered and dealt three fee simple restaurant properties, and accelerated collections of Legendary Baking’s receivables, which were all one-time sources of cash flow. American Blue Ribbon sustained operating losses of $11 million in 2018 and $7 million in 2019.

Projections for fiscal year 2020 indicted losses at $5 million “if American Blue Ribbon continued to operate according to status quo,” the company said. “The company and ABRH, LLC leadership have worked diligently and strategically to improve the efficiency of the businesses, including substantial reductions in G&A expenses, while maintaining effective operational protocols with focus on improving the customer experience,” it said. And although new leadership “substantially improved the performance” of its business with a reduction of losses by more than a third (most improvement coming from Legendary Baking), “the expectations for 2020 were continued losses for the company.” Notably, ABRH and other non-debtor affiliate companies said they were no longer willing to fund American Blue Ribbon’s operations. Per filings, American Blue Ribbon does not have any secured debt, but ABRH not being involved moving forward led to the filing. It said it does not have the “contracts, infrastructure or human resources,” to independently maintain operations without services and staffing provided by ABRH. “In the absence of continued funding by ABRH, the debtors projected that they would face a liquidity crisis on or about the petition date,” it said. The company has $14 million in unsecured claims. American Blue Ribbon also said “there been increased competition in the restaurant business and particularly in the segment thereof in which the family dining business competes” in recent years. The company pointed to “growth from existing larger family dining companies,” like IHOP and Denny’s, “that have substantial advertising expenditures to message consumers,” as well as increasing competition from grocers “as the gap between consumers’ cost of food away from home remains elevated from cost of dining at home, including grocery stores’ expanded prepared meal offerings.” American Blue Ribbon directs 75 company-run Village Inn restaurants and 84 franchises. Bakers Square has 22 company stores. Legendary Baking has two manufacturing facilities, with more than 75 percent of sales to third-party customers. American Blue Ribbon goes back to a 2009 deal. Then known as Vicorp by Fidelity National Financial, the company filed for bankruptcy in 2008. Village Inn and Bakers Square counted roughly 400 locations at the time. – Source: fsrmagazine.

Zuul Kitchens Acquires Food-Ordering System Ontray 

New York-based ghost kitchen operator Zuul Kitchens on Monday said it has acquired the online restaurant ordering system Ontray. Terms were not disclosed for the deal, but Zuul CEO Corey Manicone said acquisition of the Philadelphia-based startup and its strategic assets will allow the growing ghost kitchen concept to expand its services to restaurant partners to help them drive revenue.  “We have acquired key technical assets and talent from Ontray to better support our restaurant members and set them up for success,” said Manicone. “Together with Ontray’s technology, Zuul can innovate a ‘whole product delivery solution’ that includes affordable online ordering for our members.” Ontray — which has processed $3 million in sales for restaurants since it launched in 2016 — targets small and independent restaurant companies, offering an opportunity for them to create a customized online or mobile ordering system for a small commission fee per order, making it more accessible than services offered by the larger platforms like Grubhub and DoorDash. Manicone said Ontray’s CEO Tyler Wiest will join Zuul as chief technology officer. “Joining Ontray and Zuul Kitchens is a natural move,” said Wiest in a statement. “Both companies share a similar goal: returning the power and purse back to individual restaurants. We both believe that restaurants’ full-time focus should be on running a restaurant — not burdensome, expensive tasks like online ordering or delivery operations.” Down the road, Zuul also plans to create a platform for ordering food, enabling guests to order from multiple brands cooking out of the ghost kitchen facilities in one order, Manicone said. Making its debut in New York City last year, Zuul is among a growing number of ghost kitchen operators offering shared commissary kitchens for restaurants looking to expand their delivery reach without a brick-and-mortar investment. Zuul’s first facility opened with nine kitchens optimized for delivery. Among the chains dispatching delivery orders out of the facility are Sweetgreen, Junzi, Sarge’s deli and Stone Bridge Pizza & Salad. Manicone said “a handful” of additional Zuul locations are scheduled open this year in Manhattan, Brooklyn and Queens. – Source: NRN.

FoodFirst Global Restaurants Names Steve Layt CEO 

FoodFirst Global Restaurants, the parent company of Brio Tuscan Grille and Bravo Cucina Italiana, has named Steve Layt as the company’s new chief executive officer. The change is effective immediately, as former CEO and FoodFirst founder Brad Blum has stepped down from his role as chairman and chief executive, the Columbus, Ohio-based company said in a statement released Tuesday morning. The company said Blum will remain an owner-partner as the company plans to reposition both casual dining brands. “I would like to personally thank Brad for his outstanding leadership and contribution in setting up the foundation for FoodFirst’s success,” Antonio Bonchristiano, CEO of GP Investments, FoodFirst’s main investor, said in a statement. Layt is a 30-year restaurant veteran who previously worked as president and CEO NPC International, the nation’s largest Pizza Hut franchisee, FoodFirst said. Prior to that, he was president of Applebee’s. “We’re excited to have an operator and executive of Steve’s caliber join our team and we look forward to all we will achieve under his leadership,” Bonchristiano said in a statement. “The Board and I are confident Steve is the right leader to build on current momentum and continue to drive our operations towards industry-leading excellence.” FoodFirst, which formed in 2018 after the brands went private earlier that year, said Layt’s “first priorities will be to deliver outstanding operational excellence” and customer service to guests. The company said it is repositioning Brio Tuscan Grille in the polished, upscale segment of casual dining. It will be called Brio Italian Mediterranean. Casual dining brand Bravo Cucina Italiana will also be repositioned and renamed Bravo Italian Mediterranean, the company said. The company provided no other details on the rebranding. – Source: NRN.
Fresh Bowl Introduces Chef-Made Vending Machine Food in “Closed Loop” Reusable Container Program 

Fresh Bowl, the New York City-based food technology company that has introduced chef-created vending machines using a “closed loop” reusable container program — has received $2.1 million in a round of seed funding led by venture capital companies, Betaworks and Ground Ventures, with participation from Tuesday and Mana Capital. Venture fund Bling Capital led the company’s first pre-seed round of funding in November 2018. Launched in July 2019, Fresh Bowl owns a small but growing fleet of vending machines in a mixture of public and private spaces, like transit centers and restaurants, filled with freshly made breakfast, lunch, and dinner menu items like pastas, salads, and warm bowls. They are leading the growing trend of sustainably focused, closed loop reusable container systems. Calling them the “Red Box of on-the-go meals,” Fresh Bowl founder and CEO Zachary Lawless, said that customers can purchase a menu item from one of four vending machines in Manhattan. Then when they are done with their food, they can return their glass bowl to any Fresh Bowl location and receive a $2 credit toward their next purchase. “On the surface, it’s a loyalty program geared toward sustainability,” Lawless said.  “We can build a direct relationship to the consumer. Every time they purchase or return as product, they’re identifying themselves and we’re able to engage with them and ask questions. It allows us to create a smarter product that has better insight into their consumers.”

Although Fresh Bowl is certainly not the first company to tap into this idea of closed loop container recycling (Blue Bottle Coffee and Dig — formerly Dig Inn – also have reusable bowl programs), unlike their competitors, they have figured out a way to give customers incentive, rather than push any cost onto the consumer. “The return program does not require a deposit or for you to pay more than the [on average] $8 item you paid for at checkout,” Lawless said. “By building in that cost and making it fun and rewarding, we were able to increase returns by up to 50%. But customers can keep the bowls if they want to.”  According to Lawless, container returns hover around 85% on average. He said that as long as they can get their returns above 50% at every location, then they can beat out the costs of packaging (and having to replace containers that are not returned). With this round of funding, Fresh Bowl will be building their team and bringing on marketing and sales teams to spread the word. Their goal is to have 50 kiosks open in New York City by the end of the funding period and have 100 locations open in 18 months. Although they’re focused on building the New York City market, Lawless said that future rounds of funding will target kiosk programs for other cities. So, what’s next for Fresh Bowl? Lawless said that they have restaurant partnerships in the works and would love to partner with and place kiosks in similar minded restaurant brands like Dig. “We see Fresh Bowl as a network throughout New York City and other urban markets,” Lawless said. “Fingers crossed, you’ll know us more as a product than just Fresh Bowl itself, whether that’s our farm fresh salads or shelf-stable items like trail mix.” – Source: Restaurant Hospitality

Protocols in the Region as the Deadly Coronavirus Continues

McDonald’s has closed restaurants in five Chinese cities and is implementing new health protocols in the region as the deadly coronavirus continues to spread. On Friday, the company shuttered locations in Wuhan, Ezhou, Huanggang, Qianjiang and Xiantao — all cities that have been impacted by the Chinese government’s travel restrictions, company spokesperson Barry Sum told CNN Business in an email. At least 10 cities in central Hubei province are facing travel restrictions, including Wuhan, where this strain of coronavirus originated. “McDonald’s restaurant operation in Hubei province runs normally in cities where public transportation is available,” Sum said. “Staff and customers’ safety is our first priority and we have comprehensive, precautious measures being implemented to all restaurant operations and office staff.” It’s not clear when the affected restaurants will reopen. At least 800 people have been infected with the virus, which has killed dozens. The respiratory infection has spread to Japan, Thailand and the United States, among other countries. Major cities including Beijing have canceled some or all major Lunar New Year celebrations in an attempt to prevent more illness and death. McDonald’s” will maintain close communication with local health and other relevant authorities, actively implement any guidance by medical authorities for containment of the virus, and continue to work together to fight this epidemic,” Sum said. In addition to suspending service, McDonald’s is also enacting strict new standards to monitor employees for signs of the infection. The company shared on its Chinese social media platforms that “all restaurants are required to commence a system of measuring body temperatures of all crews upon arrival at work,” adding that it has “established a reporting, recording and observation mechanism for employees traveling to and from Wuhan during the New Year Spring Festival.” Employees with fevers or cold symptoms are to be sent home. Additionally, workers will start wearing masks and are being instructed to wash their hands and use disinfectants more frequently. The chain is also placing hand sanitizers in stores for customer use, increasing the frequency of cleanings in stores and instructing suppliers to take safety precautions, as well. McDonald’s is betting big on China as a growth market. During an October call discussing the company’s third-quarter earnings, former CEO Steve East erbrook pointed to China as one of the best-performing international markets.During the quarter, he said, more customers went to Chinese restaurants and spent more compared to the year before. Chinese customers responded especially well to McDonald’s digital initiatives, he added. Other global businesses are responding to the outbreak, as well. Shanghai Disney Resort is closing its doorsduring the holiday ”in response to the prevention and control of the disease outbreak.” It’s not clear when the park will reopen. – Source: CNN Business.

Strong Year Nets Starbucks CEO a Bigger Paycheck 

Starbucks had a good 2019 and so did its CEO. Kevin Johnson’s pay package totaled $19.2 million in the Seattle-based coffee giant’s 2019 fiscal year, according to federal securities filings. That’s up 36% over the prior year. The higher pay follows a strong year for Starbucks, which regained momentum in both the U.S. and China. Global same-store sales rose 5%, including a 1% increase in transactions, in the company’s 2019 fiscal year, which ended Sept. 29.  That included 5% same-store sales growth in its vital U.S. market, where it’s the second-largest restaurant chain. In China, same-store sales rose 4% despite a sudden incursion from fast-growing Luckin Coffee. Investors have rewarded the chain for its performance: Starbucks’ stock rose more than 50% during the past fiscal year. Johnson was named CEO in 2017. The increase in his pay package included a $4.3 million incentive plan payment. He also received $5 million in option awards and $8.3 million in stock awards. Johnson’s base salary was $1.5 million. Under Johnson and Chief Operating Officer Roz Brewer, Starbucks has used its loyalty program to lure more customers more often. It has also started using technology to eliminate tasks inside its restaurants and improve operations. Both efforts have been cited as catalysts for the chain’s improving sales. Both Johnson and Brewer can earn substantial retention bonuses over the next three years based on the company’s shareholder return performance. – Source: Restaurant Business.

Looking for “Hot Dog Drivers” 

Hmm, maybe this is why they’re looking for new drivers. A Waukesha County, Wis., sheriff’s officer pulled over the Oscar Mayer Wienemobile on Sunday for violating the state’s Move Over law. The rule requires drivers to either change lanes or slow down while passing a stopped vehicle with its emergency lights on. Technically, it wasn’t THE Oscar Meyer Wienermobile, as the company has a fleet of six crisscrossing the country to promotional events. The police department tweeted that the driver of the orange and yellow vehicle was let off with a verbal warning, suggesting there’s no ill will against the company for moving its headquarters from Madison to Chicago in 2015. Had the driver been ticketed, they would’ve been on the hook for a $249 fine and three points on their license. Oscar Mayer is currently taking applications for its next class of a dozen drivers, or Hotdoggers, or Hotdoggers, who will begin training behind the wheel of the 27-foot vehicles in June. The deadline to put your name in the bun is Jan 31. In fact, an Oscar Mayer spokeswoman tells Fox News that the Wienermobile that got pulled over was on its way to The University of Wisconsin-Madison for a recruiting event. She added that the company reiterated the importance of always driving within the law to the current drivers following the infraction. Oscar Meyer does have a need for speed, however. The company sponsors NASCAR driver Ryan Newman and recently held a poll to pick the design his Roush Fenway Ford Mustang will feature at the upcoming race in Phoenix. Source: Fox News.

Romano’s Macaroni Grill Could Buy Another Brand 

Dividend Restaurant Group—the owner of Macaroni Grill and Sullivan’s Steakhouse—could add another brand to its ranks before the end of 2020’s first quarter. If the deal comes to pass, the new acquisition would become the largest brand in the group’s portfolio. “This is a meaningful brand, it will be the largest part of our portfolio if we get it done, and a lot of its characteristics are exactly in line with Sullivan’s and Macaroni Grill,” Dividend’s CEO and president Nishant Machado says. In 2017, Machado was brought on board to bring Macaroni Grill back from the edge of bankruptcy, (the brand filed Chapter 11 in October of that year). One year later, in the last quarter of 2018, the group purchased Sullivan’s Steakhouse from Del Frisco’s for $32 million. The past year was spent carving the steakhouse brand out of financial peril, and, now, Dividend is looking around again for new acquisitions. Machado says seeking brands to add onto Dividend’s platform is the primary focus for 2020, starting, but not ending, with Q1’s planned deal. Full-service concepts with positive brand equity, an established position in their respective markets, and strong brand culture are potential targets. “People go to restaurants either for a logical reason—quick ticket times, low prices, etc.—or for an emotional reason. When it’s a logical connection, it’s a rat race; it’s not focused as much on the experience as the transaction. So our focus is adding brands to our portfolio that emotionally connect with customers,” Machado says. He says the concept in acquisition talks right now fits those criteria for new concepts, combining elements of both existing brands—Macaroni Grill’s emphasis on traditional, storied ingredients (i.e. pasta, sauce, and olive oil sourced from families in Italy) and Sullivan’s combined offering of quality and value—to be a perfect contender for a place in Dividend’s holdings. Macaroni Grill is the muscle.

While Dividend is making new acquisitions the priority in 2020, there’s some growth on tap for the group’s now-stable golden goose, too. Macaroni Grill’s turnaround was pulled off by an initial shuttering of 37 units in 2017, the assembly of a new executive team capable of putting together a carve-out strategy, and some fresh revenue streams—catering, special events, and off-premises orders, in particular. These efforts helped dig the Italian chain out of its hole. Machado says the brand outperformed industry average same-store sales by more than 300 basis points in both 2018 and 2019. “We don’t focus on trying to change who we are, just doing what we do better and trying to add to it. And it’s worked. We’ve seen continuous growth from new revenue streams like catering and third-party delivery,” he says. This year, asset-light growth is top-of-mind for Macaroni Grill, mainly through licensing for grocery items and international franchising. The chain’s 30-plus year history has rendered its name recognizable internationally as well as domestically, and the team plans to leverage this reputation to gain more franchisees across the globe in 2020. The chain’s new focus on delivery and catering over the last two years has led to a series of tech updates as well. Machado reports that 11 different tech systems—from third-party partners to online ordering platforms to scheduling systems—were implemented over the last 24 months. The brand will continue to hone these new systems in the months ahead. “Too many people shy away from tech in this industry. Our whole goal with tech is to use systems that give us line of sight into the restaurants across our system, because, if you don’t have that line of sight, you can’t manage effectively,” Machado says. Macaroni Grill recently invested in two of these “line-of-sight” systems with the particular objective of easing the labor challenge. The concept began using HotSchedules for activity-based forecasting and employee scheduling, and ProHabits, a leadership development and training program designed to inspire personal and professional growth through two-minute “microactions.” While ProHabits is often used at the C-Suite level, Macaroni Grill rolled the platform out into restaurants, allowing team members in various stores to communicate all the way up the chain of command. “We are trying to be creative and thoughtful with how we address labor,” Machado says. “In 2019, our turnover dropped 50 percent versus 2018, which is something I don’t think a lot of operators can say. We invested in ProHabits because it reinforces culture, and people are loving it because it gives them a platform to talk.” In October 2017, Romano’s MacaRoni Grill declared bankruptcy and went into chapter 11. But fueled by the $13.5 million that restructuring and turnaround-owner Mac Acquisitions raised to fund the revival, it extricated itself from chapter 11 just four months later.

Philip Romano launched Romano’s Macaroni Grill in 1988 in Leon Springs, Texas, leading to Brinker International acquiring its franchise rights in 1989. It expanded to 230 outlets before being dealt to Golden Gate Capital in 2008. Sullivan’s is growing slowly after emerging from a turnaround In 2020, Sullivan’s Steakhouse, founded in 1996, will continue on the road to brand health, coupled with some careful growth. After experiencing multiple years of same-store sales declines, Machado says that, in the first year after Dividend bought the steakhouse concept, sales went up 4–5 percent. He also reports margin growth across every line item—from labor and ingredient costs to operational expenses—since the acquisition. In the fourth quarter of fiscal 2017, Sullivan’s same-store sales plummeted 10.8 percent year-over-year, driven down mainly by a 15.5 percent decrease in customer counts. In the period before the deal—Q2 of 2018—Sullivan’s reported comps declines of 6 percent with an 11.1 drop in customer counts. Those positive numbers were achieved by adding in catering and off-premises programs, and by leaning into Sullivan’s neighborhood steakhouse brand identity. Specialized menus were added in that tailored signature items for catering and delivery, and a lunch menu was put into place as well. Personalized wine lockers and table name plaques were added to locations, allowing loyal customers to come in and easily locate their favorite wine or seating option. “We focused on amplifying the core attributes of the brand—the neighborhood steakhouse,” Machado says. As for growth, 2020 could bring a couple of new steakhouses in the U.S. The chain has historically built in less-saturated markets instead of top areas like New York or Chicago, and this will more than likely stay the same in the near future. Del Frisco’s shuttered two Sullivan’s in Q4 of fiscal 2017, including units in Seattle and Houston. An Austin, Texas, location closed that Q1 as well, with another shut down in fiscal 2018 before the acquisition was made. Machado says he sees significant whitespace for the chain in “A locations in B markets;” for example, he says, if Sullivan’s was looking to build in Dallas, the restaurant wouldn’t be built in downtown Dallas, but in a suburb of the city that has a space for a steakhouse with a local, homey feel. And, much like Macaroni Grill, moving forward, Sullivan’s will also focus on growth through international franchising. The brand signed its first non-domestic franchisee in the Philippines last year, and Machado says this first franchise partner is an entry point for Sullivan’s to build out in Asia. Of course, this individual brand growth is all second to the mystery deal that Dividend could finalize by this March. “When I came on board two years ago, the focus was to stabilize Macaroni Grill and get it on the path to growth, and the second was to build a platform that we could use to bolt on additional brands. Now, we’ve positioned ourselves for that significant growth through acquisitions—we have the right capital structure, we have the right team, we have two globally iconic brands that are performing really well, so we’re ready to take on the next opportunity,” Machado says. – Source: fsrmagazine.

Paris Baguette Names Pete Bell CMO

On the heels of announcing a new CEO, Paris Baguette USA Inc. has named Pete Bell chief marketing officer. Earlier this month, Darren Tipton was promoted to CEO of American operations, replacing former CEO Jack Moran, who had been promoted to global CEO. Bell will oversee all company marketing efforts for the bakery-café as it opens new restaurants in the USA. He previously served as CMO at several other restaurant companies, including Twin Peaks Restaurants and Specialty Brands Holding Corp., owner of the Papa Gino’s and D’Angelo Grilled Sandwich chains. “We’re thrilled to have Pete join our senior leadership team as we bring the Paris Baguette brand to new markets,” said Jack Moran, Global CEO of Paris Baguette, in a news release. “He is a progressive and consumer data driven marketer who understands how to create effective and targeted campaigns that drive sales and awareness.” Paris Baguette was founded in South Korea in the 1980s and is now a global brand that operates more than 80 corporate and franchise locations throughout the U.S., and over 3,500 internationally.  – Source: NRN.

McLane Foodservice Plans to Promote Susan Adzick to President

McLane Foodservice, part of the McLane Company, announced that Susan Adzick had been promoted to executive vice president and chief operating officer. In July of this year, Adzick will transition to president of McLane Foodservice, according to a company news release. Adzick has been with McLane since 2000 and most recently served as senior vice president of sales and strategic relationships. Prior to joining McLane Foodservice, Adzick worked at PepsiCo.  “Susan Adzick is an experienced supply chain industry executive who is well respected by all who know and work with her,” said Tom Zatina, current president of McLane Foodservice, in the news release. “I have the utmost confidence in knowing Susan will be a steward of the values of our business and keep our company a great place to work, a great place to trade and a great place to invest.” Adzick serves on the National Restaurant Association Board of Directors, the National Restaurant Educational Foundation Board of Directors as vice chair and the Restaurant Leadership Conference Advisory Council. She served on the Women’s Foodservice Forum (WFF) Board of Directors as chair in 2018. “McLane Foodservice is positioned to support the supply chain needs of our strategic partners today and tomorrow,” said Adzick in the news release. “I’m excited about helping to further shape the future of our business.” McLane Foodservice is a $16 billion division of McLane Company, which buys, sells and delivers more than 13 billion pounds of goods per year. Its clients include more than 35,000 restaurant locations across the U.S.  It services 29 of the top 100 national chain restaurants, including brands in the QSR, casual and fine dining segments. – Source: NRN.

Women’s Foodservice Forum Names Therese Gearhart as CEO

The Women’s Foodservice Forum has named Therese Gearhart as CEO and president, the organization said Friday. Gearhart (left) succeeds Hattie Hill, who in May announced her retirement as CEO and president of the Dallas-based organization. Denny Marie Post, the immediate past chair of the group and former head of Red Robin Gourmet Burgers Inc., had assumed the CEO role while a formal search was conducted. She will continue as a board member, the group said in a statement posted at its website Friday. “We are thrilled to have someone of Therese’s caliber join us to lead WFF,” said Salli Setta, Red Lobster’s president and chief concept officer current WFF board chair, in the statement. “Her long-standing commitment to diversity and inclusion, and her success in building diverse teams will be a great benefit to our organization,” Gearhart is a 20-year veteran of The Coca-Cola Co., leading business units in Latin America and Southern Africa.  She also served as co-chair and a member of the company’s Global Women’s Leadership Council, where she advised the CEO and executive leadership on strategies to accelerate the development and advancement of female talent. “I am truly honored to lead WFF as we carry forward the organization’s tremendous momentum and embrace fast-paced growth of our programs,” Gearhart said in the statement. “I am grateful to our partners, who continue to entrust our organization to provide guidance and be at the forefront of advancing gender diversity and equality across the foodservice industry.” Gearhart will assume her new role immediately, the organization said. The Women’s Foodservice Forum was founded in 1989 to promote the advancement of women and gender parity on executive teams in the foodservice industry. – Source: NRN.

Strega Prime Sold to Smith & Wollensky Parent Co.

Nick Varano has sold several of his restaurants, including Strega Prime in Woburn, to the Dublin-based investment group Danu, which operates the Smith & Wollensky Restaurant Group. According to the Boston Globe, Danu is looking to grow its restaurant operations, and purchased Strega Waterfront in the Seaport, Strip by Strega in the Park Plaza Hotel, Strega Prime in Woburn, and the five Caffe Strega coffee bars in Boston, along with a related catering business. “The Strega brand was built by my passion and determination to add to Boston’s outstanding culinary scene over the past 17 years,” said Nick Varano, founder of The Varano Group. “To have this opportunity to pass on the Strega experience to a company like Danu Partners is an incredible opportunity. This will be a new day for The Varano Group and I look forward to the continued success of everyone involved.” The glitzy Woburn steakhouse is a must-dine destination on the North Shore, as much for the food as for the scene. Juicy top-quality filet mignon, served with “Strega butter,” a mixture of fois gras and truffle marrow, is a popular favorite, along with classic steakhouse sides, like twice-baked potatoes and creamed spinach diners and perfectly prepared Italian specialties like fresh pasta and Parmesan polenta with mushrooms and Madeira wine. Star athletes from the Red Sox and the Bruins, who practice nearby, routinely find their way in—and when Hollywood hits the North Shore to film movies, celebrities often turn up in droves. “Through the creation of PPX Hospitality Brands and with Smith & Wollensky’s commitment to genuine hospitality and quality, we will bring additional support systems, growth strategy and a team of resources to drive the Strega brand to new heights,” said Michael Feighery, CEO & President of Smith & Wollensky Restaurant Group, who has worked with the international steakhouse brand for 35 years now.  In his new role as CEO of PPX Hospitality Brands, Feighery will oversee the entirety of PPX Hospitality Brands, including Strega, while remaining in his role with Smith & Wollensky.  “We are committed to investing in The Strega Group’s team members, brand awareness, facilities, and the customer experience throughout greater Boston.” The Strega division will be overseen by Nick Foley, who is among those joining from the Varano team, according to the Globe. Feighery told the paper that the two groups, taken together, generate roughly $100 million in annual revenue and have more than 1,000 employees, and noted he expects to save money through joint purchasing and contracting, but he has no plans to lay off employees because of the sale. The terms of the transaction were not disclosed. – Source: The Boston Globe/Northshore Magazine.

KFC’S beyond meat is a damn miracle

In a hip hotel in Chicago’s West Loop, nestled among more Michelin-starred restaurants than I can count, KFC has presented me with a carefully plated presentation of chubby chicken chunks on a rectangular white plate. The first is your standard, plain tan. The second, a honey BBQ. The third, drenched in buffalo sauce. And the final features an oily coating of Nashville hot spice. Sitting amid lavish bouquets of bell peppers, turnips, Brussels sprouts, and other vegetables, I take my first bite of vegan* KFC. KFC’s new Beyond Fried Chicken will be available in nearly 100 stores in Charlotte, North Carolina; Nashville; and surrounding areas from February 3 to February 23. Produced by Beyond Meat exclusively for KFC, if it sells and customers like it, a nationwide release will follow at an undisclosed date. Back in Chicago in my fancy tasting room, a 3-foot-tall cutout of the Colonel himself looks on from a green wall as I tried the undressed plant nugget for the first time. My teeth pierce the crunchy fried coating and shred through the meat. It tastes like a doggone piece of chicken—and not just any piece of chicken, but a KFC piece of chicken with hints of those 11 herbs and spices. I fork and knife my way through the honey BBQ (perfectly too sweet, and the coating still crunchy), the buffalo (a touch vinegary for my taste but offering the uncanny aftertaste of chicken), and the Nashville (the deep pepper flavor has respectable heat that hits me a delightful 10 seconds later). KFC and Beyond Meat executives are waiting to be interviewed, and I look at the four remaining pieces there on the plate, realizing this is the best faux chicken I’ve eaten in the last five years of eating mostly vegan. Would it be uncouth to keep going, to meet Ethan Brown, CEO of Beyond Meat, with BBQ sauce on my hoodie? (I opt to stop. Though I regret later that I didn’t finish.)

KFC adopting Beyond Meat is not necessarily the biggest coup for fake meats in fast food: Last year, Beyond Meat has already snuck its breakfast sausage into sandwiches and bowls at Dunkin’(the fourth most popular chain in the U.S.) while fierce competitor impossible landed the Whopper at Burger King (the sixth). But while KFC is smaller than either of these chains (at 12th place), it certainly feels like a sign of the times that a company that’s literally named “Kentucky Fried Chicken” will be selling chicken with no literal chicken in it. No wonder the alternative meat industry is projected to grow to $140 billion in a decade. As Andrea Zahumensky, CMO of KFC U.S. tells me, KFC has been eyeing meat replacements for a while, but no product in the category seemed mature enough to work. That was until last year when talks with Beyond Meat began in earnest, and the two companies struck up a deal to co-develop a product. The process has taken about six months. The target customer isn’t just vegans or vegetarians, but flexitarians—people who might eat meat but would like to cut back on how much they consume. As a recent Kroger study found, 93% of people who bought Beyond Burger had other animal proteins in their cart. And for KFC, which has been posting solid revenue and profits, though failing to have its Popeyes Chicken Sandwich moment, the product offers the opportunity to bring in a new, younger audience. The chicken is good enough that I suspect it will. But getting to this point was difficult.

Beyond Meat’s chicken product is completely custom for KFC—which is unique; the Impossible Whopper at Burger King and sliders at White Castle are the standard blend. The company went through countless iterations on the protein, ultimately opting, not for a ground, spongey protein, but something more akin to whole breast muscle tissue. As Brown demonstrates, picking apart a nugget with his fingers, Beyond Fried Chicken flakes and shreds. (It’s anything but the grill-marked homogenous slabs of Beyond Chicken I bought from the freezer aisle years ago.) The meat is marinated to improve texture and impart extra KFC flavor. Meanwhile, KFC worked on the breading, opting for a coat that was similar to the company’s popcorn chicken. It all comes together in a factory, before the product is shipped to KFC locations and deep fried to food safe temperatures, just like meat would be. This final fry is also key to denaturing the proteins, and giving the chicken the right mouthfeel, I’m told. I was surprised that KFC is opting to present its plant-based chicken so naked, as a product that could be eaten plain, dipped, or tossed in sauce. Why not release a Beyond Meat Fried Chicken Sandwich that could hide any off flavors with a bun, veggies, and extra condiments? The vegan chick’n sandwiches I’ve eaten at restaurants for years do just this, and often to a convincing effect. “Our customers expect KFC to have a certain flavor, [and] to be flavorful. Doing it in a form like this allows that flavor to shine and the texture to shine,” says Zahumensky—who implies that a bun or extra accoutrements would have just gotten in the way of this result. One other curious part of the design is the shape. McDonald’s famously uses “bell, ball, done and boot” molds in their nugget designs, to create a sensation somewhere between chicken as factory-processed food and unique, organic snowflakes. For KFC’s Beyond Fried Chicken, each chunk of chicken has a geometry that’s tougher to describe. I jot down the term “warbly square” in my notes. Some pieces look like wing flats. Others look like a sort of fried tamagotchi keychain. “It’s some kind of nugget-like boneless wing-like, more premium than a nugget [thing],” says Zahumensky. Indeed, originally this shape was even called a “boneless wing” during an early market test in Atlanta. Fans lined up around the block, but they got feedback: Plants don’t have bones so they can’t be boneless. “That’s why we test,” Zahumensky laughs at the company’s error. “We’re trying to learn.” In the future, Beyond Meat could shape this chicken however KFC wants. For now, it’s clear the company is going for something more premium than a chicken nugget—but they can’t call it a wing. Chicken cube? Chicken tesseract? Don’t be surprised to see more testing from KFC in the future, regarding both the shape of its plant chicken and its branding. Whatever shape and name Beyond Fried Chicken takes when it eventually hits stores nationwide, the product they have ready to trial today is superb. As I leave the meeting, the flavors of KFC are still left on my tongue. And I’m left with a new revelation about the future of fake meats. Some people don’t like Beyond Meat for its uncanny resemblance to real meat. Others frown upon eating plant meats when the real stuff is so delicious and plentiful. (Both of these perspectives are fair; what you put into your mouth is entirely your business.) But Beyond Fried Chicken demonstrates that KFC is more food as brand than it is food as chicken. KFC as we know it in our mind’s eye is an experience that transcends the quibbles, “Is this real meat?” to ask, “Is this authentic KFC?” And Beyond Fried Chicken certainly is as guilty, salty, chewy, herbaceous, and umami-loaded of an experience as the KFC you know. – Source: Fast Company.

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