Congress unveiled new legislation . . . .

Congress introduces a $60 billion replenishment of the Restaurant Revitalization Fund

Congress unveiled new legislation — the Restaurant Revitalization Fund Replenishment Act of 2021 — to replenish the depleted first round of restaurant relief. Congress introduced legislation to replenish the Restaurant Revitalization Fund with a $60 billion second round of restaurant relief after the U.S. Small Business Administration received requests for more than triple the allocated funds the first time around. The Restaurant Revitalization Fund Replenishment Act of 2021 would more than double the original $28.6 billion of relief for restaurants and was introduced as a bipartisan effort again by Sens. Kyrsten Sinema (D-AZ) and Roger Wicker (R-MS) and Reps. Earl Blumenauer (D-PA) and Brian Fitzpatrick (R-PA). “While it appears that our work to prioritize restaurants most in need was successful in the first round, the extraordinary demand for the Restaurant Revitalization Fund shows that many more businesses still desperately need help,” Blumenauer said in a statement. “We must work quickly to replenish this critical relief program and ensure all local restaurants get the support needed to keep their doors open, pay their staff, and support the industry’s trillion-dollar supply chain that impacts every sector of our economy.” When funds were distributed to restaurants in the first round of the Restaurant Revitalization Fund in May, women, veterans, and people of economically and socially disadvantaged groups were prioritized for the first 21 days. Although this was later challenged in court, the funds had already mostly been distributed. Initially, President Biden estimated that about

100,000 businesses would be able to be helped in this first wave of funding, but 147,000 applicants from the prioritization group requested funds for more than the initial $28.6 billion in the Restaurant Revitalization Fund. In total, more than 372,000 businesses applied during the first three weeks that the initial RRF application portal was open, requesting more than $76 billion in funds. “My restaurant will not survive the year if Congress does not refill the Restaurant Revitalization Fund,” Antwan Smalls, co-owner of My Three Sons in Charleston, S.C. told the Independent Restaurant Coalition. “Even though customers are starting to dine out once more, a few weeks of business as usual does not make up for 15 months of lost revenue. I can’t pay my bills with the money I don’t have. The Restaurant Revitalization Fund provided me a ray of hope, but now that all funds have been exhausted, I fear that I will not receive the relief I need to keep my small business open.” The National Restaurant Association will be starting a grassroots campaign to help drum up bipartisan support for the second iteration of the bill, and the bill is also endorsed by the Independent Restaurant Coalition and the James Beard Foundation. “When the RRF portal closed in May, small business restaurant owners all wanted to know ‘what’s next’ for their pending applications,” Sean Kennedy, executive vice president of public affairs for the National Restaurant Association said in a statement. “The introduction of this additional $60 billion in funding not only answers that question but proves once again that Congress understands and supports the foodservice industry.” Since the pandemic began, more than 90,000 restaurants have permanently closed, and the industry suffered one-quarter of the total job losses in the nation. At least 20 states still have COVID-era restrictions in place for restaurants.  – Source: NRN.

No reason for departure disclosed, but officials have launched the search for a replacement . . . .

Jack in the Box CIO Carlson Choi Departs after about one Month

After only a little more than a month Jack in the Box Inc. chief information officer Carlson Choi has exited the company, officials said Friday. No reason for his departure was given. Darin Harris, Jack in the Box’s CEO, said in a statement that Choi and the company mutually decided to part ways.  “We wish Carlson the best and have already started our search for a long-term CIO that will help Jack in the Box reach its full digital potential as we take this brand into its next growth chapter,” said Harris. Choi joined the San Diego-based quick-service chain on May 3 to replace Andrew Martin, who left the position in April. Choi served previously as a global chief digital officer and chief information officer for Jollibee. Since joining Jack in the Box last year, Harris has been restructuring the executive team bringing in a new chief financial officer and chief marketing officer. Most recently, the company hired former Mooyah president Tony Darden as chief operating officer. Jack in the Box operates and franchises about 2,228 restaurants in 21 states and Guam. –Source: NRN.

McDonald’s making move in the mornings

New baked foods and faster drive-thrus boosted the breakfast business at McDonald’s during 2020 and the first part of 2021, helping the quick-service restaurant chain turn the corner on an important daypart. In a June 2 presentation at the virtual Sanford C. Bernstein Strategic Decisions Conference, Christopher J. Kempczinski, president and chief executive officer of Chicago-based McDonald’s Corp., described breakfast as “probably the most time-sensitive, convenient-oriented daypart.” Being faster in the drive-thru helps the breakfast business, and to that end, Mr. Kempczinski said drive-thrus in the United States “are cranking.” “One of the things that have been, I think, really helpful for us is the fact that we have 95% of our restaurants with the drive-thru,” he said. “It’s proven to be a very safe sales channel that customers have been able to go through. And I’ve been proud about how the US team and our franchisees there have actually been able, despite a lot of volume going through the drive-thrus, to get service … to be improved. So that, for us, has been, I think, a very pleasant surprise. We’ve discovered capacity that, frankly, we didn’t realize that we had.” Mr. Kempczinski also attributed the growth in breakfast to new menu items, including baked foods. Last fall, McDonald’s added apple fritters, blueberry muffins, and cinnamon rolls to its all-day menu in the United States. The introductions marked the first addition of bakery items to the fast-food restaurant’s core menu in over eight years, according to the company. Baked foods already on the menu include cookies and pies. Finally, Mr. Kempczinski said McDonald’s is paying more attention to the breakfast daypart, making it part of the company’s marketing mix and putting weight against it. Growth in the daypart will be critical as lingering trends leftover from the COVID-19 pandemic shake out.

“I do think breakfast is going to continue to have more pressure as a daypart because McDonald’s, like every other company, is talking more about hybrid work,” Mr. Kempczinski said. “And perhaps you might see people now only working in the office three days as opposed to five days. I think that may be something that does exist as a permanent post-pandemic sort of new way of working, which will have perhaps a ripple effect on the breakfast business. But our mentality is we do think we’ve got a great breakfast business, and we want to be gaining share there.”  Source: Food Business News.

Food away from home prices rose 0.6% month-over-month in May, and 4% over the past year, as inflation at full-service restaurants hit a 13-year high . . . .

Restaurant Menu Prices Continue to Rise as Labor Costs Soar

Consumers going out to restaurants are finding higher prices these days as operators charge more for their menu items in a bid to make up for rising labor costs. Menu prices, or food away from home prices, rose 0.6% between April and May, according to the latest consumer price index data from the U.S. Dept. of Labor. Prices at restaurants are up 4% on an annual basis. The rate of menu price inflation was lower than the overall rate of inflation, which was 5% last month on an annual basis. That was the largest 12-month increase since August 2008. Menu prices have been rising since last summer when consumers began flocking to fast-food drive-thrus and ordering delivery and operators paid higher prices for labor and charged consumers accordingly. But for most of that time, it was the limited-service sector leading the charge, as demand for those meals and consumers’ willingness to pay them led to higher charges. Yet prices at full-service restaurants rose 4.1% annually in May, according to the Labor Dept., which said that it was the highest rate of annual growth for that sector since October 2018. The numbers suggest that full-service restaurants are taking their charges higher as operators face higher labor costs as they fill open positions to meet rising demand. Sales at full-service restaurants have largely recovered in the past three months as consumers, with cash to spend, have filled seats at independent eateries and casual dining concepts. All that said, fast-food restaurants continue to push prices higher. Limited-service restaurants have raised their prices 6.1% over the past year. – Source: Restaurant Business.

Michelin Star Chef Michael Mina is bringing his world-class Bourbon Steak restaurant to downtown Seattle this fall . . . .

Michelin Star Chef Michael Mina is Opening a New Restaurant in Seattle this Fall

The modern American steakhouse will use seasonal and regional ingredients, and all-natural, organic, hormone-free beef. Much like the other seven locations across the country, Bourbon Steak promises to bring its award-winning, creative interpretations of classic steakhouse dishes to the Emerald City. ​“Growing up outside of Seattle, this project is very close to home for me,” says Mina in a press release. “I wanted to strengthen downtown in a big way and found Bourbon Steak to be the perfect fit for the next iteration of the area.” The restaurant will import fresh seafood and shellfish daily, and feature the PNW in signature dishes like lobster pot pie, ahi tuna tartare, and of course, hand-cut beef mains. Mina hasn’t forgotten about the beverages, either. An extensive bar will sling out hand-crafted signature cocktails with spirits from local distilleries, a selection of local and domestic beers, and a wine list featuring over 450 various bottles. Bourbon Steak is set to open in the Joshua Green Building at 1433 4th Avenue and will be open Tuesday to Thursday, and Sunday from 5 to 9 pm, and Friday and Saturday from 5 to 9:30 pm.  – Source: Dished Seattle.

5 Food & Beverage Trends Accelerated, Altered or Accentuated by the Pandemic

We are living through an unprecedented time in which the pandemic has accelerated, altered or accentuated trends in many spheres of food and beverage culture. As we move forward into the summer of 2021 — in the context of promising trends in vaccinations and states opening fully for business — many of these behavioral changes will be in transition as consumers adapt to changing perceptions of safety and risk and explore access to a wider array of food experiences outside the home.

Accelerated and altered: In-store and online grocery shopping

How we shop for groceries underwent huge changes during the pandemic. Online grocery shopping showed significant acceleration while in-person shopping within food retailers became altered as a “journey of safety” as shoppers, fraught with worries about the virus, planned well in advance, masked up, stocked up, and got in and out of grocery stores as quickly as they could. We examined the meteoric rise of online shopping in our Food Sourcing in America report and found that in summer 2020, more than half (56%) of consumers said they had bought groceries online in the past 30 days. About a quarter (27%) of consumers said they shopped online for groceries more than before COVID-19, and 14% said they had shopped online for groceries for the very first time.

Accelerated, altered and accentuated: The rise and fall of our enthusiasm for cooking

One of the most volatile trends within food culture during the pandemic has been the rise and fall in enthusiasm for cooking at home, hence our observation that the cooking trend was both altered and accelerated by national events (including “stay at home” orders and restaurant closures). Cooking as an activity of discovery has also been accentuated by the pandemic, driving more consumers to online resources for instruction, ingredients and inspiration as well as encouraging improvisation in recipes and heightened engagement between family members. And yet, our Eating Occasions 2020 report finds that despite our initial shift to cooking, our enthusiasm did not last throughout 2020 as cooking fatigue quickly set in. Heading into the fall of 2020, we found that heavy levels of food preparation declined, and consumers became more comfortable with sourcing from restaurants.

Accelerated and altered: Snacking out of distraction

Even prior to the pandemic, we were already a nation of snackaholics, and with all the couch time at home during the pandemic, our snacking tendencies soared. The Hartman Group’s Snacking: Emerging, Evolving, and Disrupted report found 35% of consumers saying they snacked more often in 2020 compared to the previous year.

The increase in snacking (an eating behavior that is highly vulnerable to lifestyle changes) reflected the chaotic pandemic times and the diversity of changes occurring in consumer lifestyles. While some level of “aimless” snacking had always taken place in recent decades, the tumultuous events of 2020 elevated “distracted” snacking to the status of its own pillar. Our analysis uncovered that that 40% of all snacking reflects some need for distraction.

Accelerated search for functional foods and beverages

In terms of changing behaviors that link to diet and nutrition, the COVID-19 pandemic intensified consumers’ ever-evolving interest in how functional foods and beverages could boost their immunity and overall health and wellness. Our report Functional Food & Beverage and Supplements finds that at least half (55%) of adult consumers claim to use functional food/beverage solutions to treat or prevent a specific condition, including general prevention efforts.

An accentuated focus on social justice, racial equality, and community, and employee welfare

The COVID-19 pandemic has shed light on long-existing inequities throughout society and the food system and exposed them as more acute, particularly among people of color. In addition, the pandemic has revealed the extent to which food and farmworkers are both essential and vulnerable — and made them even more so, bringing labor and safety issues to the attention of consumers more than ever before. Increased attention on social justice issues has brought long-standing labor concerns in the food industry — which have been exacerbated by the pandemic — to the fore. As the pandemic cast a shadow over everyday life, consumers and community organizations banded together in 2020 to lift up their communities. The growth of grassroots aid over the past year exemplifies the rise of community-mindedness among consumers and, consequently, the importance of incorporating aspects of community welfare into how food businesses operate. As issues of social justice become more and more visible, companies must closely evaluate their values and priorities and ensure that all aspects of their business — from sourcing and production all the way down to corporate communication — are in alignment. It is becoming ever more difficult for companies to remain neutral on such issues, and so companies must aim for consistency and authenticity in communication in order to maintain consumer trust and loyalty.  – Source: Restaurant Smart Brief.

Senate Bill Aims to Clear Path for CBD in Interstate Commerce

Bipartisan legislation introduced in the US Senate on May 19 would ensure hemp-derived CBD (cannabidiol) products are regulated by the Food and Drug Administration like other legal products used in dietary supplements, foods, and beverages. The bill, the Hemp Access and Consumer Safety Act, was sponsored by Senator Ron Wyden of Oregon, Senator Rand Paul of Kentucky, and Senator Jeff Merkley of Oregon. “CBD products are legally being used and produced across the nation,” Mr. Wyden said. “Yet because the FDA has failed to update its regulations, consumers and producers remain in a regulatory gray zone. It’s been more than two years since I worked with colleagues to have Congress legalize hemp and hemp-derived products. It’s long past time for the FDA to get with the program, for the sake of American consumers and farmers.” In 2018, Congress passed the Agriculture Improvement Act, the current farm bill, a provision of which removed hemp from Schedule I of the Controlled Substances Act. This legalized the production and sale of industrial hemp and hemp derivatives, including CBD. But the FDA prohibits any new dietary ingredient, food or beverage from entering interstate commerce if it has been studied or approved as a drug, as was the case of CBD. The FDA earlier approved one drug, Epidolex, which contains a highly purified form of CBD, for the treatment of seizures associated with Lennox-Gastaut syndrome. The FDA has the authority to exempt substances from this prohibition, but the agency has asserted it still has only a limited understanding of the safety profile of CBD and other cannabis-derived compounds. The FDA has sought information and comments on CBD safety and regulation from stakeholders, and hopes were the agency eventually would define legal ways to use CBD in foods, beverages and dietary supplements. But progress has been slow, in good part because of demands placed on agency resources by the COVID-19 pandemic.

Recent FDA actions with regard to CBD largely have been limited to dispatching warning letters to companies making therapeutic claims for the substance. For instance, products using CBD as an ingredient have been promoted for treating pain for arthritis, alleviating cancer pain, improving functioning for consumers with Alzheimer’s, and even treating or preventing COVID-19. It took one act of Congress to legalize the farming of hemp, and sponsors of the Hemp Access and Consumer Safety Act suggested it may take another act of Congress to clear the path for legal CBD use in food, dietary supplements, and beverages. “Hemp-derived CBD products and businesses have earned their recognition in the marketplace, but the FDA, unfortunately, hasn’t treated them like any other food additive or dietary supplement,” Dr. Paul said. “The Hemp Access and Consumer Safety Act directs the FDA to regulate hemp products properly and provides a huge relief to hemp farmers, processors, and merchants.” Mr. Merkley said, “Every day that the FDA drags its feet to update its CBD regulations, hemp farmers are left guessing about how their products will be regulated, and real economic gains for workers and business owners in Oregon and across the country are left on the table. Hemp-derived CBD products are already widely available, and we all need FDA to issue clear regulations for them just like they do for other foods, drinks, and dietary supplements.”

The Hemp Access and Consumer Safety Act would allow hemp-derived CBD products to be lawfully used in dietary supplements, food, and beverages under the Federal Food, Drug, and Cosmetic Act. Sponsors said the bill would give priority to consumer safety, requiring manufacturers to comply with all existing federal regulations for products that contain CBD. The bill also would ensure the products will be properly labeled. To that end, the bill said the Secretary of Health and Human Services may “establish labeling requirements for dietary supplements and food that contain hemp, hemp-derived cannabidiol, or a substance containing any other ingredient derived from hemp.” Jeff Daulby, senior vice president of government affairs, Consumer Brands Association, said, “The CBA commends Senators Wyden, Paul, and Merkley for shining a spotlight on a product that has been a catalyst for a conflicting patchwork of states laws and regulations. Consumer Brands has long advocated for a national regulatory framework for CBD that empowers FDA to establish smart, consistent regulations and gives them the resources they need. Today’s action is a first step in delivering these much-needed regulations for American consumers.” Patrick Atagi, board chair of, National Industrial Hemp Council, said, “Last year, nearly $15 billion in economic benefits were left out of the economy because CBD wasn’t regulated appropriately. If the FDA can’t act, Congress should fulfill its oversight role and pass this legislation.”  — Source: Food Business News.

Development chief Tabassum Zalotrawala shares insights into the fast-casual chain’s plans for growth . . . .

Staying Nimble: Chipotle Prepares for Expansion with Multiple Formats

Perhaps more than anything else, restaurants of the future will need to be flexible in format to serve guests with varying needs. That’s according to Chipotle Mexican Grill’s Chief of Development Tabassum Zalotrawala, who shared her insights during a session on “Inside Chipotle’s Recipe for Growth,” part of the ongoing Nation’s Restaurant News digital series CREATE — The Future of Foodservice. With about 200 restaurants opening per year and a push into Canada planned, Chipotle is positioning its brand for nimble growth with innovative new formats. The Newport Beach, Calif.-based chain has plans to grow locations with “Chipotlane” drive-thrus, for example, and it is testing digital-only kitchens with no dining room or front service line. The chain is also working to improve delivery and “carside,” or curbside, service. “The restaurant of the future is not just one format. It’s one that continues to evolve,” said Zalotrawala. “I think it’s more important than ever to carefully curate the type of format that fits best in a certain trade area,” whether it’s a delivery-only location, digital-only, or even one that needs a larger dining room and drive-thru. Of the 40 Chipotle units that opened during the March 31-ended first quarter, 26 had Chipotlanes, and the drive-thru units have demonstrated about 10% higher sales than traditional Chipotle restaurants, Zalotrawala said. Chipotle units are central to the chain’s growth strategy, she added. Where physically possible, existing units will add Chipotlanes, she said. Where a drive-thru may not be possible for existing properties, the company may look to relocate restaurants. The digital kitchen formats in test at a location in Highland Falls, N.Y., will be targeting guests who order ahead through third-party delivery platforms or Chipotle’s app or website. Guests have the option of picking up from a “lobby” that gives a view into the kitchen, but customers don’t walk the line, as they do in traditional restaurants. “It’s good for those in a hurry or those avoiding large crowds,” she said. This year and next, the company plans to test the format in a few more locations where digital sales are strong. About 98% of Chipotle’s nearly 3,000 restaurants have second make-lines that serve digital orders, and the company’s digital sales have grown 174% year over year, Zalotrawala said. Digital orders now account for about half of sales overall.  “Our digital business in every restaurant is almost $1 million, so it really is a restaurant within a restaurant and that’s a big change,” she said. “It’s no longer a side business. It’s a business on its own.” The chain plans to continue investing in technology to better the customer experience and make the brand more convenient and accessible, she said. The pandemic year has also been a learning experience, especially when it comes to inefficiency, and future restaurants will be designed to help the chain meet sustainability goals for diverting waste from landfills. “The ways in which the sector has become wasteful has become painfully apparent,” said Zalotrawala. “So reopening restaurants may take the opportunity to move to a more circular economy and virtually eliminating waste.” Another teaser from the session: Chipotle may soon be adding a new dessert to the menu —though Zalotrawala offered no details. — Source: Create.NRN.com

RJ Melman, son of the co-founder Rich Melman, discusses the highs and lows of 2020 as the company celebrates 50 years . . . .

Lettuce Entertain You president sees the future of restaurants as brick and mortar, not virtual

As Lettuce Entertain You Enterprises (LEYE) marks its fiftieth year in business, president RJ Melman doesn’t see any signs of slowing down. The multi-concept operator has over 150 restaurants in several states across the country ranging from fast-casual to fine-dining and, during the pandemic, brought some closed concepts back as virtual restaurants. Melman, however, does not think virtual restaurants are the future of the industry despite the Chicago-based company’s massive success with them over the past few years. LEYE is a family business for Melman. His father Rich co-founded the company back in 1971 and RJ has been with the company all his life, learning from his father. It’s one of the reasons he thinks brick-and-mortar units are still the way of the future. Earlier this week, LEYE announced it would be opening Aba, a concept already in Austin and in Chicago, and South Florida. – something Melman hints at in our podcast, which was recorded before the news broke. That expansion marks the company’s first Florida unit and is set to open in 2022.  – Source: NRN.

JAB Holding-owned Krispy Kreme went public with its initial public offering, looking to raise $100 million . . . .

Krispy Kreme goes public with IPO filing, looking to raise $100 million

The doughnut and coffee chain will be trading on the Nasdaq under the ticker symbol, “DNUT.” The news was announced a month after Krispy Kreme initially filed a draft registration for an IPO with the U.S. Securities and Exchange Commission. The IPO will take Krispy Kreme public for the first time since the acquisition by JAB Holding took the company private in 2016. According to the filing, Krispy Kreme, which also owns Insomnia Cookies, generated $1.12 million of net revenue in 2020, with a net income loss of $60.9 million. The company made $321.8 million in revenue for the first quarter of 2021, ended April 4, up 23% from $261.2 million the same quarter the year prior. The filing also noted that Krispy Kreme achieved its highest level of sales — $1.1 billion — in the company’s history in 2020 during the COVID-19 pandemic. In the first quarter of 2021, Krispy Kreme operated at a net loss of $3.1 million, down from a net loss of $11.5 million the same quarter the year prior. The company also added 17 new stores in 2020, with another 30 in the works for 2021. “In recent years, we substantially invested in our business to accelerate performance and position us for long-term, sustained growth,” Krispy Kreme said in its IPO filing. “We have invested in our omni-channel model, brand positioning, product quality, and innovation capabilities. Our strategy is built on our belief that almost all consumers desire an occasional indulgence, and that when they indulge, they want a high quality, emotionally differentiated experience.” Krispy Kreme also solidified plans for further expansion of its interactive hot light theater shops, like the company’s flagship in Times Square in New York City, as well as smaller shops and kiosks and ramping up e-commerce and delivery opportunities throughout North America. The company has not yet announced the number and value of shares in the IPO. – Source: NRN.

The chain has Seen Figures Rise as High as 30 Percent Compared to 2019 . . . .

How World of Beer Rose from Major Layoffs to Soaring Sales

The COVID-19 pandemic was arguably the most dramatic event World of Beer CEO Paul Avery has faced in his career. The 54-unit chain decided to quickly furlough 92 percent of its staff in an attempt to allow everyone to get proper government assistance. For those who remained, salaries were reduced by 50 percent. At one point in time, the brand was forced to temporarily close more than 60 percent of its stores. “Everybody kept their chin up and figured out how we’re going to get through this,” Avery says. It was a dire and stressful environment. But all those long nights translated to double-digit sales growth and the quadrupling of off-premises sales as the industry heads into the summer, and that’s all against pre-pandemic figures. So how did World of Beer go from debilitating crisis to promising revitalization? Avery has four specific reasons. The first bullet point was an obvious one—taking care of employees and making them a priority. World of Beer didn’t know how long the pandemic would last, but it knew there would be a backside. It also knew any restoration of business would be dependent on the return of its staff, so the brand distributed bonuses gave food to employees on a weekly basis, and deployed takeout and delivery to provide a salary during bleak times. World of Beer also leveraged the Paycheck Protection Program to hold onto its people. The methods worked, as nearly everyone on the management level has returned. The second reason was communication among all stakeholders—lenders, landlords, suppliers, and staff. As the captain of the ship, Avery found it important to get ahead of things and open the dialog as opposed to the other way around. He had many virtual meetings with hourly workers and management team members just to give them a heads up on how the company was navigating the pandemic. The third part was decisive action, meaning the leadership team that remained took “bold and thoughtful” action on how to protect the company and reduce costs without cutting the commitment to quality. The fourth and final pillar was maintaining liquidity to ensure World of Beer could meet its obligations and preserve the business long enough to reach the other side. The multi-layered strategy built a bridge, and now sales are increasing more than 20 percent—and sometimes even 30 percent—compared to 2019. The average check has significantly grown while traffic is down in just the single digits. Operational acumen, good reputation in communities, convenient outdoor patio seating, and a strong value proposition are all contributing to the comeback, Avery says. “We’re enjoying a really strong rebound, and again, I attribute that to our management team who has been really stable,” Avery says. “And when you’ve got stable management, you’ve got stable hourly teams. As the industry’s been challenged with staffing, we’ve been very fortunate to have I think better than most staffing in order to capture this rebound.”

WORLD OF BEER

Off-Premises Sales have Jumped more than 300 Percent. 

Part of that rebound has been revving up an off-premises program that was essentially nonexistent prior to COVID. When the world shut down, World of Beer brought in consultants to bolster the program. The strategy was guided by Chief Brand Officer James Buell, who oversaw the integration of third-party delivery services and first-party platform Olo. The effort increased off-premises from less than 1 percent of sales to about 4 percent or more than a 300 percent increase. Avery expects off-premises to be around 6 to 8 percent of sales by the end of 2021, and he anticipates a lot of incremental revenue to come with that growth. Part of the opportunity is relaxed alcohol to-go laws instituted by governors during the pandemic. More than 30 states and Washington, D.C. lifted restrictions for restaurants and bars during COVID, according to the Wall Street Journal. Some allowed delivery, as well. Avery says World of Beer tried several alternatives when it came to this particular opportunity, but the CEO admits the chain has yet to crack the code. During the height of the pandemic, the brand served gallons of margaritas and gallons of sangria and mojitos. Like others, the company placed individual cocktails in little containers and sold crawlers and canned wine. However, he wouldn’t describe it as an exciting result. While the brand hasn’t optimized that sales channel quite yet, Avery knows there will be future chances. “I think it’s a great opportunity for World of Beer, knowing that we serve adult beverages and offer them, to have an interesting adult beverage served with your takeaway food,” Avery says. “That’s a great proposition, and one that we need to do a better job and figure out how to market that and appeal to consumers.” What World of Beer has been successful at is unit growth—something not many full-service counterparts can say. The company managed to open four stores in 2020, three of which were company-run and one that was franchise-led. Three of the four are hitting their sales projections, mostly because they opened in the latter part of the year when states were more open. The fourth location is based in Virginia, a state with tighter restrictions. But given how the other locations have performed with loose regulations, Avery is confident the Virginia unit will bust out soon. Six locations are planned for 2021. Beyond that, World of Beer plans to open about 12 restaurants per year, and 70 to 75 percent of that will be company-owned. The brand is 46 percent corporately run, and Avery expects that proportion to increase. “We’re certainly open to franchising and want to franchise to the right partners and welcome that,” Avery says. “But I think it would be good for us to end up in a 65/35ish company vs. franchise. The franchise group we have today is fantastic. We have a stronger group today than we did going into COVID. We’ve got about 15 percent attrition through COVID times in the unit level numbers. But what we’re left with today is a much healthier fleet than we were going into it. And I believe as a result of the manner in which our leadership team supported our franchise community, we have better franchise relationships today than we have ever had.”

CEO Paul Avery says World of Beer has felt the labor crisis, but not to a significant extent. 

A thorn in those development plans could be the ongoing labor shortage. Avery says World of Beer feels the crunch, but perhaps not as significantly as others are. He has seen specific challenges with plywood, fixtures, furniture, and other equipment, so that’s why the chain is moving months ahead on purchasing and deposits to keep openings on track. The CEO also describes inflationary chicken prices as “crazy,” but he says World of Beer won’t compromise on its fresh chicken program. The brand isn’t in a position where it’s had to close any locations or delay openings because of short staff. There are a few stores that are challenged, but in general, the stability of the management team has kept labor in check. “It’s a challenge. I’m certainly not saying it’s not,” Avery says. “We have gaps, we have openings, we have people working harder than they’ve ever worked for. We have people working more overtime, which is a challenge. But we got to take care of our folks and show our appreciation and do the right things to compensate them for their efforts.” Although a challenging regulatory environment is ahead, Avery believes the unemployment issue will be short-term as people come off the enhanced benefits. Twenty-five states have announced intentions to end the weekly $300 unemployment boost a few months before it expires in early September. That obstacle aside, World of Beer is gearing up for a productive summer. “I expect traffic to turn positive in the next couple of months,” Avery says. “I expect our comp sales to remain double-digit for a considerable period of time. I expect the operating environment to remain compressed as it’s providing less seat in our communities and a greater opportunity for us.” – Source: FSR magazine.

Last Month, 10.83 Million People were on Payroll . . . .

Restaurant Industry Still Missing 1.46 Million Jobs

Restaurants gained 186,000 jobs in May, but the industry still has a long road toward reaching pre-pandemic figures. Last month, 10.83 million were on the payroll, and that’s 1.46 million fewer than February 2020, when the industry boasted 12.29 million, according to the Bureau of Labor Statistics. It also doesn’t help that quick-service and full-service brands are experiencing a large-scale labor crunch. Numerous brands such as Applebee’s, Firehouse Subs, Jimmy John’s, IHOP, Red Robin, Chipotle, and McDonald’s have announced intentions to hire thousands of workers. Brands are scrambling to hire in order to meet soaring demand and sales. Restaurants posted positive two-year comps for the 10th straight week through the week ending May 23, Black Box Intelligence reported. A resurgence is unquestionably occurring, but its sustainability comes into question considering staffing shortages, which result in reduced hours or even temporary closures. Black Box’s research shows that growth has decelerated in recent weeks compared to the period between mid-March and April, and the industry is still far off from garnering positive traffic growth. There’s certainly room for a comeback. Restaurants and bars have lost more than $280 billion in sales because of COVID, according to the U.S. Census Bureau, and the National Restaurant Association reported that roughly 90,000 locations have closed. As if that weren’t enough, the price of beef (14.5 percent), pork (9.6 percent), fresh fruits and melons (9.3 percent), processed poultry (5.4 percent), and dairy products (3.2 percent) all increased from March to April, according to the Bureau of Labor Statistics. Also, data from reservation platform OpenTable shows dining restrictions still exist in more than half of the states. “People who depend on restaurants and bars for their livelihood continue to be disproportionately impacted by this pandemic and need help,” said Erika Polmar, executive director of the Independent Restaurant Coalition, in a statement. “After 15 months of lost revenue, restaurants and bars are barely hanging on by a thread. They are struggling with rising prices, consumer hesitancy, and a pile of debt that will soon come due.” The $28.6 billion Restaurant Revitalization Fund set out to solve these lingering issues and build a strong bridge to a more enjoyable post-COVID environment. But the money appears to have already run out. More than 372,000 restaurants, bars, and other businesses applied, requesting a combined total of more than $76 billion. The bleaker reality is that restaurants and bars are eligible for at least $168 billion, the Independent Restaurant Coalition said. “To prevent these small businesses from closing permanently, and an employment crisis that will disproportionately affect young people, people of color, immigrants, the formerly incarcerated and single mothers, Congress must refill the Restaurant Revitalization Fund,” said Polmar. Overall, the U.S. economy added 559,000 jobs in May, and the unemployment rate declined 0.3 percentage points to 5.8 percent. There were about 9.3 million unemployed workers in May, but that could change drastically in the coming months. Half of the states are ending the enhanced $300 weekly unemployment benefit that’s scheduled to expire in September. States are ending the benefits as early as June 12 and as late as July 19. Additionally, the Department of Labor is pushing states to reinforce “work search” requirements for those unemployed workers. – Source: FSR Magazine.

The fast casual’s digital enhancements, marketing, and hiring strategies, and new design contributed to its success. And the launch of a crispy chicken sandwich didn’t hurt . . . .

Fresh Ideas Positioned Smashburger for Growth During the Pandemic

Smashburger president Carl Bachmann wants the chain to be the No. 1 fast-casual brand. And the pandemic didn’t stop him from thinking big. “We kept the doors open the whole time, so we didn’t lose as many employees as other chains,” said Bachmann. That, and developing and promoting team members from within, are helping Smashburger confront current labor challenges in a better position. The fast-casual also moved ahead with growth plans and is poised to open 40 restaurants in 2021. The chain’s portfolio currently includes 132 franchised locations and 119 corporate stores. To staff up for openings in major cities, including Chicago and New York, Smashburger “prehires” three to four months ahead. “We like to ‘sharpen the saw’—train and develop people early to get the skills in place,” said Bachmann. “Then we can blend the skilled labor with local hires.” Some of the 40 new locations will sport a new prototype with a focus on digital and menu innovation. The design features a chef-inspired open kitchen, contactless pickup through food lockers, and drive-thrus at selected units. Towards the end of 2020, Smashburger released its new app and refreshed its website, both of which offer a speedier, friction-free ordering process. A new logo also positions the concept as a hipper, more modern brand, with earth tones replacing the dated color scheme. But Bachmann gets most passionate when he talks about menu innovation—particularly the Scorchin’ Hot Crispy Chicken Sandwich introduced in April. “We’ve always been food-focused, so when the fried chicken sandwich became a ‘foodie thing’ we wanted to get in on it,” he said. Smashburger had chicken sandwiches on the menu before, but with this item, the team decided to “push the needle on bold flavor” and come out with a hot version. The result—a spicy chicken sandwich with a Nashville hot flavor profile. The chicken breast filet is dredged in a coating spiked with Nashville hot seasoning and fried, then layered on a toasted bun, topped with mayo blended with hot pepper sauce and pickles. To promote the sandwich, Smashburger tried an unconventional marketing tactic. The “tongue-in-cheek” campaign, as Bachmann refers to it, called for an end to the chicken sandwich wars by inviting quick-service restaurant employees to come into the stores during “Peace Hours” to try the new sandwich for free. “We wanted to have fun during a tough year and thank restaurant workers who had been on the front lines through the pandemic,” said Bachmann. The campaign, along with a BOGO deal on April 20, generated a lot of buzz and the sandwich became Smashburger’s No. 2 best-selling item within two weeks. The buy one, get one free offer was the brand’s best-performing promotion so far this year, contributing to a 30% traffic increase, said Bachmann. “It worked to make people aware that they could get chicken at Smashburger,” said Bachmann. Although the chain had to scramble to get supply after the sandwich sold out in some locations, parent company Jollibee has access to the largest suppliers, so it was a short-term problem, he said. Menu innovation is also happening in the burger category. Mid-pandemic in 2020, the fast-casual debuted the smoked bacon brisket burger and plans to run it again this year. “We are also looking at more vegetarian and vegan choices, but don’t want to offer one of the commercial plant-based burgers,” said Bachmann, adding that there’s already a black bean burger on the menu. In the pipeline is a lineup of milkshakes that will launch later this summer. Burgers with regional flavors are also in the R&D stage. “Burgers will always be a platform for boasting our culinary chops,” said Bachmann.  – Source: Restaurant Business.

The Game is Scheduled for Every Wednesday through August 25 . . . .

Buffalo Wild Wings Launches Trivia Series with Big Prizes on the Line

Buffalo Wild Wings knows customers are champing at the bit to go out once again. To direct that pent-up demand toward its doors, the brand is launching Blazin’ Trivia, a new weekly trivia night with $50,000 and a trip to Las Vegas on the line. The game will be hosted every Wednesday night, with teams not only competing against each other inside the location but against other players nationwide. Customers can play on their own devices on the Buffalo Wild Wings app or at playbuffalowildings.com and can follow along on the TV screens in the sports bar. Players earn 10 reward points each just for playing. Teams that place first in their individual sports bar will receive six free boneless wings for each member. The team with the most points in the state will get 1,000 rewards points for each player, and the one with the most points in the country will grab 5,000 rewards points per member. The contest began June 2 and runs through August 25. The team with the most points at the end of the period will earn the $50,000 prize and a trip to Las Vegas. The trivia night is one of the first major promotions to come under new CMO Rita Patel, who started her role in September after serving as vice president at Target. The trivia night is yet another marketing initiative Buffalo Wild Wings is utilizing to attract dine-in customers as COVID restrictions wane and consumer confidence increases. In April, the chain announced that it was offering a new Blazin’ Challenge featuring its Blazin’ Carolina Reaper sauce. The sauce is measured at more than 2 million Scoville units—the hottest level on the scale—and features the Carolina Reaper pepper, hot red pepper sauce, and roasted garlic. The Blazin’ Challenge Bundle includes 10 Blazin’ Carolina Reaper Wings, a headband, and a scoop of ice cream. In March, Buffalo Wild Wings brought back its classic NCAA Tournament overtime promotion in which the brand offers free boneless wings every time a game goes into overtime. Additionally, the chain is leveraging its partnership with BetMGM to offer curated boosted odds and promotions specifically for customers playing inside stores in New Jersey, Indiana, Colorado, West Virginia, Tennessee, and Iowa. It also launched an in-store channel OT Odds Powered by BetMGM, which delivers a plethora of sports betting content like live game odds and fantasy and betting advice. Even in September Buffalo Wild Wings attracted guests by offerings Browns fans a chance to watch games from a custom-designed Dawg Pound section inside the sports bar. The marketing strategy not only serves to bring customers back to dine-in but also to shift traffic to weekdays and relieve capacity restraints on the weekends. Fellow casual-dining brands have instituted similar measures. For example, Melting Pot is running a Thursday promotion for Thursdays and Best Fondue Friends Forever promotion on Wednesdays to give customers a reason to visit in the middle of the week. Although it’s not for weekdays, STK and Kona Grill recently introduced weekend brunch to reduce the backed-up traffic during the dinner daypart on weekends. Buffalo Wild Wings finished 2020 with $1.8 billion in total revenue, compared to $2.1 billion in 2019. It also swung a net loss of $181 million versus a net income of $91 million the previous year. The brand began the year with 1,206 units after closing a net of just two units in 2020.

Electrolux Professional Announces Partnership with Chef Andrea Zanin

With this new partnership, Chef Andrea Zanin will consult with the Electrolux Professional team in North America to promote innovation. We are excited to announce our partnership with Chef Andrea Zanin in North America. He will be working closely with the company to provide education and support for Electrolux Professional solutions. Chef Zanin will be attending our training seminars and consulting with our Sales team. He will also be promoting Electrolux Professional across his social media platforms. You can follow him on Instagram and LinkedIn. The culinary family business for Chef Zanin Andrea Zanin did not start out wanting to be a chef. Though he worked in the bakery with his father, mother, and brothers, he decided to study finance and economics at the University of Venice. “My father was a great baker,” Chef Zanin says. “He is still very active, continues to make cake and bread. His influence on me was to transfer passion, love for this job, to work very hard, and to be a great and respectful professional person. This is the fundamental value that gave me an amazing career.” When his father fell ill, he was asked to take over the family business – a pastry and coffee shop. “I accepted the challenge, and I started to learn and improve my profession,” Chef Zanin said. He first went to the Etoile School in Sottomarina (Venice), Italy – and then Paris, France, to develop his skills. He returned to Italy to improve his business. He also developed a catering business, as there was a big need in Venice. He fell in love with the savory part of his job. In 2004, he was named Best Chef at Cinema Festival La Biennale by the mayor of Venice. “I still create my plate, and my dish with the vision, color, texture of the pastry chef,” Chef Zanin said. “This helps me a lot to create my line and my visions.” Award-winning chef builds a relationship with Electrolux Professional The award-winning chef has provided all the culinary services to Lamborghini USA and Brunello Cucinelli since 2017. He started as a pastry chef in Italy, following in his father’s footsteps. He has also served as CEO of Queens County Bakers New York and opened a three-star Café located in New York City. In 2016 he founded AZCucina LLC which provided consulting services and high-end luxury catering. Chef Zanin’s first contact with Electrolux Professional was when he was in Paris. When he returned to Italy, a chef friend opened his mind to an Electrolux Professional kitchen. He used our equipment in one of his restaurants in 1995. “I expect to work together with Electrolux Professional to use my skill and knowledge to approach and develop this market,” Chef Zanin says. “I chose Electrolux Professional a long time ago in Italy for my company. I enjoy About Electrolux Professional: it is one of the leading global providers of foodservice, beverage, and laundry for professional users. Our innovative products and worldwide service network make our customers’ work-life easier, more profitable – and truly sustainable every day. Our solutions and products are manufactured in 12 plants in seven countries and sold in over 110 countries. In 2019, Electrolux Professional had global sales of SEK 9,3bn and approximately 3,600 employees. Electrolux Professional’s B-shares are listed at Nasdaq Stockholm.

The action challenges the legality of New York’s Just Cause legislation, which prevents certain restaurant employers from dismissing or cutting the hours of an employee at will . . . .

Lawsuit Seeks to Overturn NYC Restrictions on Fast-Food Firings and Layoffs

A first-of-its-kind law that limits fast-food chains’ ability to fire employees in New York City is being challenged in federal court by advocacy groups that blast the measure as a way for unions to promote restaurant workers’ interests without being voted into that role. The plaintiffs are also seeking to overturn a related measure that prevents local units of a quick-service chain from laying off workers or cutting any employee’s hours by at least 15% unless the employer can show a “bona fide economic reason.” “In other words, layoffs are barred until the employer suffers actual economic harm, and may not be used to avoid that harm or to increase volume production, sales, or profit,” reads the complaint. It contends that the measures would negate at-will employment, a standard in place within New York City and its host state for more than a century. In most instances, employees could only be dismissed or disciplined by having their hours cut by at least 15% if the employer can demonstrate “just cause,” and only after the employer provides “progressive discipline” to alleviate performance issues. The actions are subject to review via an administrative hearing or by an arbiter. An exception is made for “egregious behavior” on the part of an employee. The two groups bringing the action—the Restaurant Law Center, an affiliate of the National Restaurant Association, and the New York State Restaurant Association—asked the U.S. District Court for the Southern District of New York to block the measures before they take effect July 5. They note that the legislation unfairly targets just a small splinter of New York’s business community. The measures apply solely to New York City branches of limited-service restaurant chains that extend to at least 30 locations nationwide. When the legislation was passed by the New York City Council in December, industry advocates and some chains voiced fears that the law would be copied in other jurisdictions. Several controversial measures that originated in the city have spread nationwide, including no-smoking laws and menu labeling. The plaintiffs contend that the laws being challenged incorporate language that was directly provided by the Service Employees International Union (SEIU), a labor group that has been striving for years to organize restaurant chains. The union also supports Fight for $15 and a Union and a second group pushing to change restaurant workers’ compensation, One Fair Wage. The complaint alleges that the so-called Just Cause legislation was a way for unions to push their causes legislatively instead of following the organizing and voting guidelines set in federal labor law. SEIU “has instead chosen to end-run around federal labor standards by focusing on a different constituency: the New York City Legislature,” the lawsuit states. “Through the City Legislature, the SEIU seeks to evade the NLRA [National Labor Relations Act], overturn the state’s longstanding doctrine of at-will employment, and, instead, impose onerous procedural rules that go to the heart of collective bargaining agreements in unionized workforces.” The complaint adds, “the SEIU played a large part in drafting the laws.” The SEIU and City Council members who supported the Just Cause measures have yet to respond publicly to the lawsuit, which was filed against the city on Friday. – Source: Restaurant Business.

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