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Krispy Kreme Doughnuts, Inc. has proposed an initial public offering of its common stock . . . .

For a Second Time, Krispy Kreme could go Public

Krispy Kreme Doughnuts, Inc., a privately held company since 2016, has proposed an initial public offering of its common stock. The company on May 4 reported it confidentially had submitted a draft registration statement on Form S-1 to the Securities and Exchange Commission. An IPO should take place after the SEC completes its review process, subject to market and other conditions. Krispy Kreme has yet to determine the number of shares it will offer and the price range. Krispy Kreme, founded in 1937 and based in Winston-Salem, went public before in 2000. The stock price rose as high as $49.74 per share in August of 2003, but then the SEC launched an investigation of the company over allegedly inflated quarterly and annual earnings. The share price fell as low as $11.48 in 2004. The SEC in March of 2009 approved settlements with Krispy Kreme Doughnuts and former executives. Krispy Kreme Doughnuts went private in July 2016 when JAB Holding Co. acquired it for $21 per share in cash or a total equity value of about $1.35 billion. At that time more than 1,100 Krispy Kreme shops were in more than 26 countries.  – Source: Food Business News.

New menu items at KFC, Pizza Hut, and Taco Bell drove more consumers to the Yum! Brands, Inc. subsidiaries in the second quarter  . . . .

Yum! Brands Gets a Boost from New Menu Additions

KFC saw strength in its new chicken sandwich, while Pizza Hut benefited from its Detroit-style pizza, Edge Pizza, and two new offerings featuring plant – base sausage from Beyond Meat, said David Gibbs, chief executive officer, during a July 29 conference call with analysts. Taco Bell kicked off the quarter with the return of the Quesalupa as part of its $5 Cravings Box, followed by the relaunch of the Naked Chicken Chalupa. The new additions, along with continued investments in digital capabilities, boosted earnings at Yum! above pre-pandemic levels. Net income for the second quarter ended June 30 was $391 million, equal to $1.29 per share on the common stock, up 86% from $206 million, or 67¢ per share, in the same period a year ago. On a two-year basis, net income was up 26%. Total revenues were $1.6 billion, up 34% from $1.2 billion a year ago and 18% from $1.3 billion two years ago. Worldwide system sales excluding foreign currency translation grew 26%, with KFC at 35%, Taco Bell at 24%, and Pizza Hut at 10%. Worldwide same-store sales grew 23% year-over-year and 4% on a two-year basis. In the United States, comparable sales at KFC and Pizza Hut were above pre-pandemic levels, growing 19% and 9%, respectively. Comparable sales in international markets declined on a two-year basis, due to renewed COVID-19 restrictions in certain markets. “Looking across the more than 150 countries in which we operate, we’ve seen that while the overall is positive, the recovery will neither be consistent from country-to-country nor linear within a country,” Mr. Gibbs said. “We’ve seen that increased customer mobility driven by reopening trends and vaccinations contributed to strong performance in many of our markets.” Even as economies continue to reopen, the importance of the off-premises occasion remains a top priority for the company, he added. Yum! delivered more than $5 billion in digital sales in the second quarter, up 35% from a former all-time high of $3.5 billion in the same period a year ago. Recent digital investments include an in-house intelligent coaching app for Pizza Hut stores and an internally built KFC e-commerce platform. The company also has agreed to acquire Dragontail Technologies, a food preparation optimization company that automates kitchen flow, driver dispatch, and customer order tracking. “It’s really hard to single out which part of the business is going to benefit most from digital because all of our brands are very rapidly becoming digital brands,” said Chris Turner, chief financial officer. “You’re seeing that in the numbers.” The company is moderately increasing its product pricing across the United States to offset higher commodity costs and wages, he said. “When we have commodity inflation, we have greater purchasing at scale than most players in the industry,” Mr. Turner said. “We are also seeing some wage inflation… but when we think about dealing with both of those, the next lever that our franchisees and our brands pull is pricing.  We are confident that our brands have strong pricing power and our franchisees, who are the ones who actually make those decisions in their restaurants, are being very thoughtful about how to do that. They use analytics. They tend to layer these in over time so that they don’t get too far ahead of the consumer, and our brands are very smart about how they create a mix in the menu.”  — Source: Food Business News.

 

Carl’s Jr. is expanding its partnership with Beyond Meat to launch the Beyond BBQ Cheeseburger . . . .

Carl’s Jr. Adds Another Beyond Burger Option

Inspired by the flavors of Carl’s Jr.’s Western Bacon Cheeseburger, the Beyond BBQ was “developed to complement the Beyond Burger patty” and is an “indulgent flexitarian option that turns barbecue on its head with a plant-based spin,” Carl’s Jr. said. The burger features a Beyond Burger patty topped with Carl’s Jr. original barbecue sauce, American cheese and crispy onion rings. The launch of the Beyond BBQ Cheeseburger follows the December 2018 debut of the Beyond Famous Star on Carl’s Jr. menus, marking the chain’s first plant-based option. The burger includes a Beyond Burger patty, cheese, lettuce, tomato, sliced onion, dill pickle, special sauce and mayonnaise. Since its introduction, the Beyond Famous Star has become the most successful burger launch for the brand in the past two years with more than 4.5 million sold, said CKE Restaurants Holdings, Inc., the parent company of Carl’s Jr. and Hardee’s. “After seeing the overwhelming demand for our Beyond Famous Star, in true Carl’s Jr. fashion we knew it was time to give customers even more plant-based innovations to delight their taste buds,” said Patty Trevino, senior vice-president of Carl’s Jr. brand marketing. “With one Western Bacon Cheeseburger sold every second, we saw this as the perfect flavor inspiration — and so the new Carl’s Jr. Beyond BBQ Cheeseburger was born. We’re always looking for the next great way to innovate and deliver the most craveable burgers, and we’re thrilled to continue our partnership with industry leader Beyond Meat to bring new and exciting flavors to our customers.” The new Beyond BBQ Cheeseburger will be available beginning this month with a suggested price of $6.29. – Source: Food Business News.

 

The creator of design-forward restaurants Wabi Sabi and Hiyakawa sees room to grow . . . .

Alvaro Perez Miranda Plots Two new Concepts to Bring a True Taste of Japan to Miami

The Miami restaurant scene is on fire and Japanese cuisine, in particular, is in high demand. The time is right for Alvaro Perez Miranda, who is building a small group of beautifully designed restaurants that offer a true taste of Tokyo. The restaurateur with Venezuelan roots spent 15 years living in Tokyo, where he first moved to help open an Il Forno Trattoria. He later opened or developed some 70 more restaurants in Japan with Royal Host, a food-and-beverage company, and as a consultant. Perez Miranda returned to the U.S. in 2006 and eventually settled in Miami in 2015, where he first revived The Vagabond Hotel’s restaurant and bar with chef Alex Chang. In 2019, Perez Miranda launched the sushi concept Wabi Sabi. And a year later, he also launched Hiyakawa, which has been described as an “architectural stunner,” where Perez Miranda’s love for art and authentic Japanese cuisine meet. Perez Miranda, who is president and owner of Japan Authentic Food Systems LLC, said his goal primarily was to bring to Miami the dining experience he knew and loved from Japan. “Miami was lacking authentic Japanese food and every time I went to eat sushi — the sushi was good, I’m not putting anybody down — but it was not really what I wanted after spending 15 years in Japan.” And Perez Miranda sees more room for growth, with two more Japanese concepts coming in 2021 and 2022. Later this year, Perez Miranda plans to launch the more-casual Midorie, a concept that he plans to multiply. He envisions 20 or so units, with growth first in the Miami area and later to other markets. Next up is Ogawa, which means Little River, an omakase-only concept Perez Miranda will design himself. The restaurant will have a Japanese garden to deepen the cultural experience. Listen to Perez Miranda outline his plans and why he feels Japanese cuisine is ripe for growth across the U.S.  – Source: Restaurant Hospitality.

Former Kulture executive chef Dawn Burrell joins the group to open the concept Late August . . . .

Houston chef Chris Williams Launches Lucille’s Hospitality Group with Plans for Four New Concepts by 2022

Last year, when then Presidential contender Joe Biden came to Houston to pay respects to the family of George Floyd — whose death at the hands of police sparked a national social justice movement — they shared a meal at the beloved restaurant Lucille’s. Founded in 2012 by chef Chris Williams with his brother Ben Williams and named for their great-grandmother Lucille B. Smith, who was a pioneering African American entrepreneur, educator, and chef, Lucille’s is known for refined Southern cuisine, but also for its cultural backstory. Smith had owned the businesses Smith’s BBQ and Lucille’s Fine Foods General Store in Forth Worth. She was a home economist who created one of the first college-level commercial food and technology departments at Prairie View A&M University. She published recipes and created a biscuit mix sold in grocery stores. She cooked for Dr. Martin Luther King Jr. and Eleanor Roosevelt. Her chili biscuits were served on American Airlines flights. Williams also created the nonprofit Lucille’s 1913, which has carried on Smith’s mission through the COVID crisis by serving more than 150,000 meals to vulnerable communities. Now Williams is ready for the next step: The chef and restaurateur have launched Lucille’s Hospitality Group, which plans to launch four new concepts by 2022. The group has brought in James Beard Award semifinalist Dawn Burrell — known for her work at the Texas restaurants Kulture and Uchi, and soon to appear on a season of “Top Chef” — who will develop a new Afro-Asian concept scheduled to open in Houston in August. Lucille’s chef de cuisine Khang Hoang is also a partner. And Williams has big plans to expand Lucille’s 1913 nonprofit, to build it into a “conscious collective” that is looking to buy land to plant community gardens to bring fresh produce to food deserts, as well as building an ecosystem to provide jobs, foodservice training and more — and food waste from the restaurants will be turned into compost to nurture those gardens. More information about Lucille’s 1913 can be found here, or make a donation. Here’s Chris Williams with more on the new concepts to come.  – Restaurant Hospitality.

Grupo Bimbo SAB de CV is determined to protect profit margin improvements . . . .

Bimbo Profits Hit all-Time High

Having hit new highs in financial results during the company’s second-quarter, Grupo Bimbo SAB de CV is determined to protect profit margin improvements, said Daniel Servitje, chairman and chief executive officer. Toward that end, the company is taking a number of steps, including raising prices in North America during the current quarter, he said. Overall, Grupo Bimbo generated record profits in the second quarter ended June 30 while boosting return on equity by 280 basis points. The operating income of the company’s North America business, though, was 2.8 billion pesos ($140 million) in the second quarter, down 31% from 4.1 billion pesos in the second quarter of 2020, but up sharply from 1.3 billion in April-June 2019. Sales were 42.7 billion pesos ($2.15 billion), down 13% from 49.1 billion a year earlier. Operating income was held back, in part, by a $38 million charge related to the company’s multi-employer pension plan liabilities, to reflect current interest rates. Adjusted EBITDA, which excludes the effects of the MEPPs charge, was down 11% in North America in the second quarter, and EBITDA margin widened to 40 basis points, to 13.3%. Excluding the effects of foreign currency market moves, North American sales were up 0.9% during the second quarter compared with the same period in 2020. Bimbo said the sales gain reflected strong branded product sales, market share gains in several categories, and rebounding foodservice business. Measured against 2019, second-quarter sales were up 18% in peso terms and 12.5% in dollar terms. “(The North America) business performed very well during the quarter, led by sweet baked goods, buns and rolls and snacks,” Mr. Servitje said during a July 28 call with investment analysts. “Our front-line execution was strong, and we continue to manage trade promotions prudently to maximize return on investment.  Our top-line run rate when compared to pre-pandemic levels were very strong. The strength was driven by consumer demand, increased household penetration and the investments we have made and continue to make in our main brands. The private label run rate has remained soft, while foodservice is beginning to rebound as schools and restaurants manage reopenings.” Amid extraordinary upward pressure on costs, Mr. Servitje said Bimbo was committed to being sure the company avoids “a decline in our margins” over the course of the current inflationary cycle. “We have been very proactive on understanding the impacts that we had from our commodity costs and other inputs,” he said. “And we have been able to address them in the different markets through different levers. One, obviously, is pricing. And another lever is trade optimization or revenue growth management. And finally, in some cases also, we have complemented that with productivity initiatives.” Elaborating on actions Bimbo is taking in the face of higher costs was Fred Penny, president of Bimbo Bakeries USA. “We are going to take a price increase from a North America standpoint in Q3 because we need to,” Mr. Penny said. He said the price hike would be combined with utilization of the other levers cited by Mr. Servitje, including revenue growth management steps aimed at optimizing trade spend and “quite frankly, really significant work on productivity.” “We don’t know where the inflation is going to head,” Mr. Penny added. On the flip side, Mr. Penny expressed satisfaction with Bimbo’s second-quarter results.

He particularly noted continued sales strength in the second half of the April-June quarter. He said Bimbo lapped “huge demand spikes” in the first half of the second quarter. “Q2 has been an interesting quarter,” he said. “If you think back to the fact that the first half of the quarter, we were cycling huge demand spikes from a year ago obviously when the pandemic first hit. What’s been a very positive result for us has been that as we’ve gotten into the back half of, we’ve seen fairly impressive run rates to a year ago, frankly surprising to me that we would have been able to run positive to a year ago.” He said volume was slightly higher than a year earlier which, “given the huge demand of a year ago,” should be viewed as a major plus. Asked about strong profit margins, Mr. Penny said the significant number of premium brands in Bimbo’s portfolio has been a benefit as has been the results of capital investments aimed at lowering the company’s cost base. In response to a follow-up question about price increases, Mr. Penny declined to offer specifics but emphasized the magnitude of the challenge. “This is a complicated issue, quite frankly,” he said. “We’re in an environment where the inflation, at least from my perspective and my time in the industry — I can’t recall an environment like this where commodities, labor, etc., were as volatile as they are. There’s not much you can look at right now, whether it’s a commodity, whether it’s labor, whether it’s transportation, etc., where there isn’t a lot of volatility and pricing pressure. I’m confident that we’re dealing with that head-on, and we’re going to manage it.” Net majority income of Grupo Bimbo in the second quarter was 3.1 billion pesos ($156 million), up 19% from 2.6 billion in the second quarter last year. Sales were 83.8 billion pesos ($4.22 billion), down 2.9% from 86.3 billion. Sales were up 6.6%, excluding the effects of foreign exchange rate market movements. The company’s adjusted EBITDA reached an all-time high and EBITDA margins widened by 120 basis points, to 14.4%. Versus the second quarter of 2019, adjusted EBITDA was up 7% and net sales rose 16%. “I am more than proud that our teams reached record profits for a second quarter and net sales growth of 6.6%, excluding FX effect,” Mr. Servitje said. “We continue to see strong demand and extraordinary run rates in our core business. We held and grew market share across our key categories and saw a recovery of those channels and categories that suffered during the pandemic. As we move forward, we will continue to invest in our associates, our brands, in the entire value chain, in our sustainability strategy and in our digital transformation projects to achieve our vision.”  — Source: Food Business News.

How consumer behavior changes are dictating the restaurant recovery .  . . .

NPD Group’s David Portalatin Said Sales are Moving in the Right Direction

NPD Group’s David Portalatin said sales are moving in the right direction, but challenges persist as operators navigate a new operating environment. While the verdict is still out on how the recent surge in COVID-19 cases due to the Delta variant will affect the foodservice business, restaurant performance has shown encouraging signs of a recovery. With Americans increasingly getting out of the house, traveling, and feeling more comfortable dining at restaurants, dollar sales at restaurants were up in June compared with pre-pandemic levels. David Portalatin, the foodservice industry advisor for consumer research firm The NPD Group, said restaurant dollar sales were up 8% compared with June 2019. “We’re definitely moving in the right direction,” he said. Sales were up despite customer visits being down 7% compared with June 2019, he added. He attributes that to the fact that consumer behavior changes during the pandemic have led to more group meal occasions and higher check averages across the industry. Behavioral changes have also affected where Americans choose to eat. “We’re definitely seeing the traffic patterns improve, but over the last year or so, the American consumer has learned how to prepare more meals at home,” Portalatin said. “If you look at the grocery sales data, for example, grocery sales are still up double digits versus two years ago.” Indeed, restaurant operators still face a number of challenges in making a full recovery, not the least being the Delta variant driving another surge in COVID cases. For one, the trend toward at-home meal replacement — which had stagnated consumer restaurant visits in the five years prior to the pandemic — continues to benefit the supermarket category. Second, on-premises occasions are still down 30% compared with 2019, putting more pressure on off-premises channels. In addition, the shift to more Americans working from home continues to affect business in urban areas. Portalatin estimates that 58 million people are still working primarily at home, compared with about 5.5 million who did that pre-pandemic. NPD Group expects 15–30 million people to continue working from home on a permanent basis. “I think you will see some normalization, some return to the cities, some return to the central business districts, but we did measure a very big migration away from some of the more densely populated urban areas, and I think some of that will have some permanence to it,” he said. “I think you’re going to see a more permanent shift away from major markets into … different kinds of communities that are smaller, that offer a little more space and flexibility. And this may have an effect on where new restaurants get built in the future.” Watch the interview with Portalatin for a more detailed look at how the restaurant industry is recovering from the COVID-19 pandemic, and how operators should adjust according to consumer behavior changes that accelerated in the past year.  – Source: NRN.

Too Good to Go Reducing Food Waste one Click at a Time

Chicago is the most recent city to welcome Too Good To Go, the company behind its namesake app for reducing food waste. Founded in 2016 in Copenhagen, and now in 15 countries, Too Good To Go saves more than 200,000 meals every day. Since the B Corporation’s US launch 10 months ago, the app has amassed more than one million users and 4,300 partners in eight cities, including, New York City, Boston, Washington, San Francisco, Seattle, and Portland. “We throw away one-third of the food we produce each year,” said Lucie Basch, co-founder, at the Chicago launch party on July 14. “That’s $1.3 trillion worth of food that gets tossed. Food waste is responsible for 8% of greenhouse gas emissions. It has great consequences both on the environment and the economy. And socially speaking, it’s absurd to throw away the food we produce when we know today that 870 million people are underfed.” As a degreed engineer, Ms. Basch started her career in the food processing industry in the United Kingdom. Upon gaining a better understanding of how much food is wasted, even before it leaves the production facility, she decided to do something about it. Her light-bulb moment came when she was passing a bakery and saw the baker tossing perfectly fine products at the end of the day. “I asked if I could have them, but he said they were not allowed to donate,” Ms. Basch said. “So, I offered to purchase the product. He wound up giving me three times more than what I had paid for.” The experience is the basis of Too Good To Go. The app connects consumers to surplus food from restaurants, bakeries, cafes, and grocery stores at the end of each business day. There’s no fee to use the app on either end. “It’s really this win-win concept where the store doesn’t throw away food anymore and where people can save food while getting three times the value of what they paid for,” Ms. Basch said. “I believe the best way to fight big causes like food waste is to make everyone part of the solution.” The app allows customers to browse participating locations. They then reserve and pay for a “surprise bag” on the app and head to the store during the pick-up window, which is based on each location’s closing time. “The contents of the bag vary daily, but the consumer has an idea of what the bag will contain based on the type of food sold at the location,” Ms. Basch said. “Most stores do not want to run out of fresh food, so they overproduce and then have waste. The app allows stores to update the amount of surplus they have in real-time, based on how sales are going throughout the day.” The small volumes of food that stores have at the end cannot effectively be redistributed to food banks or homeless shelters. The food is safe and ready for eating, but not sellable the next day. Too Good To Go fills the gap in high-density, urban areas by making it easy for consumers to pick up this surplus. The financials are very straightforward. The buyer pays $4 to $6 for the bag and the store fills it with products valued at three times the price. The app takes a commission of $1.79 on every transaction, with the rest paid to the seller. Too Good To Go will launch in Austin, Texas, this week, followed by Atlanta and Los Angeles in October. Plans are to be in many of the largest US cities by the end of 2021. –Source: Food Business News.

The quick-service chain’s latest meal will debut next month . . . .

McDonald’s announces its newest celebrity meal partner: Saweetie

McDonald’s on Thursday announced that its latest celebrity meal partnership will be rapper Saweetie. The ‘My Type’ rapper’s meal will go on sale on August 9. The “Saweetie Meal” includes a Big Mac, 4-piece Chicken McNuggets, medium fries, a medium Sprite, tangy barbecue sauce, and “Saweetie and Sour Sauce” (the chain’s traditional sweet and sour sauce renamed for the performer). “McDonald’s and I run deep – from growing up back in Hayward, California, all through my college days – so I had to bring my icy gang in on my all-time favorites,” Saweetie said in a statement. “Depending on the mood I’m in, there are so many ways to enjoy my order. I like to keep things fresh – I know that’s right.” McDonald’s is marketing the meal as “customizable,” inviting customers to create new combinations and flavors with the provided items. A graphic from the campaign shows customers different ways to eat the meal, such as covering the fries in sauce and putting them between two burger patties because “anything can be a sandwich,” and “fries can be more than aside.” Other combinations include covering the McNuggets in sauce and putting them between two buns and replacing the top bun of the Big Mac with fries. “We’re thrilled to team up with Saweetie, a true brand fan who puts her own spin on everything she touches across music, fashion, beauty and culture,” said Morgan Flatley, chief marketing and digital customer experience officer, McDonald’s USA. “And now she’s brought that spark and creativity to her signature McDonald’s order by celebrating her love for our food and passion for mixing things up.” New signature packaging will also be available with the drop. Described as “icy,” the packaging looks to be inspired by diamonds. Celebrity meals have boosted the Chicago-based chain’s sales. McDonald’s latest quarterly sales were up 25.5%, partly due to the success of its BTS meal and merchandise line – the chain’s most recent signature meal.  – Source: NRN.

Operators are looking for ways to work with fewer or less-skilled staff while maintaining higher dining traffic . . . .

US Foods’ Answer to the Labor Shortage: Product Innovation

The restaurant industry’s recovery and labor challenges are running the same race today. According to Datassential, 62 percent of operators are concerned about finding skilled workers as they staff up to meet surging demand. While retention and recruitment solutions, from wages to benefits to referrals, and so forth, remain heart to the labor conversation, the near-term reality is operators are going to have to try to do more with less. And not let it show before customers’ patience wears thin. One answer could be prepared and the products themselves. US Foods’ Summer Scoop 2021 lineup, themed “Dining Out Is In Again” was designed to address the labor shortage head-on. Stacey Kinkaid, VP of product development and innovation at US Foods, spoke with FSR about the rollout, what to expect, and how it can help restaurants navigate the ongoing challenge.

Let’s start by talking about the labor shortage. What is US Foods hearing from its operators?

Customers are thrilled by the influx of diners coming back to their establishments. That said, the restaurant industry is facing labor challenges, and operators are looking for innovative ways to work with fewer or less-skilled staff while maintaining higher dining traffic. As their partner, we’re here to bring them solutions to these labor challenges. Product innovation is one of those options, and that’s what our latest product innovation (launched in Summer Scoop) is all about—on-trend, labor-saving, versatile, profit-driving products designed to reduce back-of-house preparation and skilled labor demands. Time-saving products help with the challenge of fewer workers available overall. Ready-to-cook and ready-to-use products also help with the lack of skilled labor available. Profit-driving products help with the challenge of rising labor costs. Easy-to-prepare innovative products help avoid the temptation to scale back the menu to simplify based on the labor challenges. In addition, we continue to bring helpful tools and resources operators can access for more expert tips for optimizing labor. In fact, we recently launched a webinar called “Labor Saving Hacks,” which features our Food Fanatics chefs showcasing how to leverage products that help cut prep time and reduce labor costs while maintaining the flavor, consistency, and integrity that diners expect. These resources are available for free on our website and available for any operator, not just US Foods customers.

What were some of the goals with the Summer Scoop in terms of addressing this, from easy preparation to versatility?

The main goal with Summer Scoop is to provide operators with on-trend products that deliver on taste and quality and can be easily integrated into the operator’s menu. At the same time, these products have also been developed to provide easier and faster preparation. We’re trying to make it as easy as possible for back-of-house staff to bring exciting and flavorful dishes to their diners so they can continue to attract and retain them. We all know there are hours of preparation that go into creating dishes—from chopping greens to preparing meats and more. For restaurant operators who are already dealing with less staff, these items can save hours of work so operators can ultimately save time and money while driving a profitable menu. We’ve also designed these items to be very versatile so operators can use them across a variety of dishes. Take the Cross Valley Farms Apple Pineapple Pico De Gallo, for instance. This is a simple yet exciting substitution that we have seen operators use across a variety of applications such as tacos, salsas, nachos, or even as a burger topping. In addition to loving the flavor, they love the ease of not having to create a fresh pico from scratch.

What are some product highlights, and how do they help operators combat labor issues?

We received a lot of positive feedback the Chef’s Line Crispy Italian Tomato and Mozzarella Arancini. This product is made in Italy with Italian Carnaroli rice and then filled with tomato, mozzarella, and an authentic vegetable blend. Not many diners are familiar with arancini, and these offer a new global experience in a nice bite-sized option that operators can menu as an app or side dish. They also travel well for operators who are maintaining a robust off-premise operation. The Patuxent Farms Biscuit Breaded Chicken Breast Chunks is one of my favorites. We made these with whole muscle breast chicken chunks and then coated them with a crunchy, biscuit-like breading for an upscale version of popcorn chicken. It’s simple to prep back-of-house and saves approximately three hours of labor compared to creating something similar from scratch. The biscuit breading is unexpected and brings a product like this to the next level. Operators can also customize the product with a wide variety of dips and sauces such as our Chef’s Line Nashville Hot Sauce. Some of the more popular items that can be used across various applications are the Chef’s Line Alabama White Barbeque Sauce, the Cross Valley Farms Apple Pineapple Pico De Gallo, and the Chef’s Line Roasted Garlic & Herb Compound Butter. Sauces, salsa, and specialty butters are very labor-intensive items to make from scratch, so operators are really gravitating toward these items because they offer a little twist on the traditional and stand out on a menu but are also delicious and ready to go with little to no prep.

 

Just broadly, what are some menu trends you’re seeing at US Foods? Looks like the grill is taking center stage this summer.

Yes, items off the grill are always a popular staple for summer menus, and operators are always looking for unique flavors, again—something that will stand out on the menu and offer ease of prep and profitability. We’ve brought several exciting options to Summer Scoop. We have two exciting burger options, and both are all-natural, which means they don’t contain artificial ingredients and are minimally processed. One product, the Chef’s Line All Natural Seasoned Beef Brisket Steak Burger is made with USDA choice grade brisket and a bit of sirloin and then seasoned with coarse ground black pepper and naturally hickory-smoked sea salt. An operator can cook them from frozen—savings two hours of labor compared to creating them from scratch. We also have the Chef’s Line All Natural Italian Sausage Burger. This item is made from whole boneless pork shoulder and seasoned with herbs and spices authentic to Italian sausage. Again, this is cooked from frozen so it’s very easy to prep and plate. Another exciting item launched in Summer Scoop is our Tender by Design steaks. As your readers know well, unpredictability is a challenge in the beef industry, especially in today’s market. There is variance in the quality of beef driven by the time of year, and pricing fluctuations can create unwanted financial pressures as operators aim to deliver consistent, high-quality steak offerings. We recently launched Tender by Design nationally to help solve this pain point. Tender by Design is a proprietary process that brings tender, high-quality, and competitively priced steaks to operators across the country year-round. The process starts with sourcing the beef when the climate and feed conditions are best. Then, the product is aged to standards that ensure optimum texture, tenderness, and overall quality. The items are individually vacuum-packed to allow operators to use only as much as they need when they need it. Through a proprietary freezing technology, the beef is then frozen, locking in tenderness and freshness. Operators then temper as needed to align with their customer traffic, resulting in better inventory control. We’ve had amazing feedback on the steaks and we’re thrilled by the response so far.

Did COVID trends influence Scoop this time around? Is there still demand for things like portability and comfort food?

The impact of the changing restaurant landscape caused by the pandemic is certainly a driving force behind the development of the line-up. Labor savings and portability is key right now because operators are struggling to balance the resurgence of on-site diners, and the existing take-out and delivery operations ramped up during the pandemic. So, we’ve talked about labor-savings products already, but I’m just as excited about the new offerings that are ideal for off-premise.

Elaborate on the grab and go line, especially with the beverage items. 

Let’s start with the beverages. Two of the prominent on-the-go beverage items featured in Summer Scoop are the Thirster Organic Kombuchas and the Thirster Organic Oatmilk.

The kombuchas are made from a blend of tea, fruit juice, and ginger, and live cultures, and tap into the current probiotic trend. What I like about these teas is that they come in an on-trend slim can and can easily pop into a to-go bag or be served as a cocktail base behind the bar. The Thirster Organic Oatmilk aligns well with the growing demand for plant-based proteins and operators are using this product in lattes, mochas, and smoothies, making it quite versatile and on-trend. As part of consumers’ desire to enjoy their favorite foods and beverages in any setting, during the coronavirus pandemic there was an exponential increase in the number of restaurants offering to-go beverages and cocktails—a trend that is here to stay as life returns to normal. To help restaurant operators capitalize on this trend, US Foods introduced the Monogram Tamper-Evident Beverage Pouch, allowing operators to deliver their signature cocktails in a to-go format, and that is great for cold smoothies, juices, and teas.

How do you think these pandemic trends might change now that dine-in is returning? Will there be a rush back toward more adventurous dining, or being able to order what guests can’t make at home?

I think many of the pre-pandemic trends will continue. Diners are certainly looking for new and unfamiliar ingredients that provide an unexpected twist on their favorite dishes and dishes that they couldn’t easily make at home. What we’re also seeing is that the younger generations are very adventurous and always looking for new flavors, new combinations, and new food experiences, so operators need to keep that in mind as they seek to cater to that segment.

What are some other ways US Foods is helping operators, especially independent restaurants, navigate challenges at this point in the pandemic recovery journey?

We offer operators a wealth of tools and resources for free on our website, all designed to help operators navigate the ever-evolving challenges and adjust their businesses accordingly. For instance, some of our upcoming webinars include: Avoiding Potential PPP Forgiveness Pitfalls, Preparing Your Restaurant for the Summer Business Boom, Satisfy Summer Cravings: What Consumers Want, and How to Service With No Staff. I would also encourage restaurant operators to set up a free one-on-one consultation with one of our Food Fanatics Chefs or Restaurant Operations Consultants, who can help with anything from menu planning to P&L strategy.  – Source: fsr magazine.

Smokey Bones’ virtual brand The Wing Experience is throwing its hat into the chicken sandwich ring . . . .

Smokey Bones’ Virtual Concept Introduces Crispy Chicken Sandwich

Smokey Bones’ virtual brand The Wing Experience is throwing its hat into the chicken sandwich ring and is about to put the other chicken sandwiches to shame. Starting now, its new Crispy Chicken Sandwich is golden fried to perfection and available in 50 different flavors – more than any other brand. While other chicken sandwiches are only offered in traditional or spicy versions, The Wing Experience is taking its 50 wing flavors and making them available for the Crispy Chicken Sandwich. Guests can opt to have their chicken tossed in flavors like Sticky Honey Garlic sauce, Bourbon Blackberry BBQ, Honey Sriracha, and so many more. To see all 50 available flavors – everything from savory to sweet to a spicy slow burn or punch of heat – visit the saucy menu here. The Crispy Chicken Sandwich can be ordered a la carte for $7.99 or as a combo meal for $11.99 and includes a choice of a side and fountain drink. “Chicken sandwiches are one of the hottest items hitting menus right now, and as Masters of Meat, we knew we could make ours more craveable than anyone else’s,” says CEO James O’Reilly. “By offering our Crispy Chicken Sandwich in 50 different flavors, we are offering our guests more flavor variety and customization potential than any other brand.” Smokey Bones’ other virtual brand, Burger Experience will offer a version of the Crispy Chicken Sandwich topped with mayo and pickles for $8 a la carte or $12 for a combo meal, available as a traditional style or spicy. Burger Experience has also added a Good Seed veggie burger for $9 for guests seeking a meat-free option. The Good Seed veggie burger is packed with superfoods like chia and hemp seeds, sprouted grains and spices, and served Falafel style with lettuce, tomato, red onion, pickles and topped with a garlic mayo and a touch of sriracha. In addition to the Crispy Chicken Sandwich, both delivery-only brands are expanding their menus by adding onion rings and sweet potato fries for $5 for a regular ($4.99 The Wing Experience) or $7 for a large ($6.99 The Wing Experience).  – Source: fsr magazine.

The fast-growing wing chain plans to open 25 company-owned restaurants and ghost kitchens in the heart of New York City “as fast as we can,” its CEO said . . . .

Wingstop is Ready to Take on Manhattan

The fast-casual, whose sales exploded during the pandemic, is planning to open 25 company-owned restaurants—a mix of ghost kitchens and traditional stores—in the heart of New York City, the company announced during a call with analysts Wednesday detailing its second-quarter earnings. “The New York market is one with a lot of white space for our brand,” Wingstop CEO Charlie Morrison said. Wingstop will open its first ghost kitchen in Manhattan in a few weeks, with many more restaurants to come. Morrison said the chain has long held back this area for expansion of company-owned restaurants. “It’s well-suited to be a company-owned market,” he said, calling in with other Wingstop executives from New York City. “We wanted to make sure we had access to real estate that is reasonably priced, which we believe exists in this market. We wanted a good partnership for ghost kitchen expansion. A delivery-focused market makes sense for us.” Wingstop on Wednesday said it had surpassed its record same-store sales of a year ago, with a 2.1% increase for the quarter ended June 26, or 34% same-store sales growth on a two-year, stacked basis.  Systemwide sales increased 15.8% to $589.7 million. Wingstop currently has 15 ghost kitchen stores worldwide, all of which have similar average unit volumes to traditional restaurants. With ghost kitchens, the wing chain can open a new unit in about six weeks, Morrison said. And, what’s more, the sales-to-investment ratio can be more than three times higher for a ghost kitchen Wingstop than a typical store, he added. “You can invest in these things for a fraction of the cost of a streetside location and generate the same, if not more, volume,” he said. The expansion in Manhattan fits with Wingstop’s broader unit-growth mission. The Dallas-based chain opened 45 net new stores in Q2, an increase of 13.1%, and has upgraded its full-year forecast to overall unit growth of 12% or more. The chain, which ended the quarter with 1,449 U.S. locations, reported it had opened more than 200 new restaurants over the last 12 months. Of those U.S. units, just 34 are company-owned. The chain has 175 international franchise stores.

As for Manhattan’s new Wingstop locations, Morrison said: “We’ll get them open as fast as we can.” – Source: Restaurant business.

The business landscape has changed dramatically sine the pandemic began . . . .

How Restaurants Can Strategically Capitalize on the Restaurants Act of 2021

The COVID-19 pandemic has negatively impacted virtually every industry since it began back in March of 2020, especially the retail restaurant industry. The combined effects of America’s pandemic response, such as increased savings and social distancing measures, have forced many businesses to close some of their locations throughout the country, and others to shut down completely. Thankfully for companies in this industry, the $120 billion Restaurants Act of 2021 was introduced to Congress back in February of 2021. This bill was seen as pertinent to the recovery of the industry, intended to help companies weather the financial storms brought about by the pandemic. This reintroduction came not long after the Senate unanimously voted to pass the amendment to create a restaurant relief fund. The bill pertained to businesses in the food service industry with less than 20 units. The operators of these businesses were eligible to apply for up to $10 million in grants that could be utilized to cover expenses incurred throughout the pandemic. The bill had a timeline of eight months once it went into effect and would be retroactive to February 15, 2020. This means that any expenses incurred after this date will be considered in determining how much each business will receive. However, any funds that weren’t spent within this time period would convert to a loan with an interest rate of 1 percent and a maturity date of 10 years. Executive director of the Independent Restaurant Coalition, Erika Polmar, previously stated, “Ensuring the 11 million people employed by restaurants and bars can continue to earn a living is vital to rebuilding our economy after this pandemic.” The passing of the bill would not only help save current jobs in the industry but would also help reemploy those who have been furloughed or laid off due to the pandemic. The bill essentially combined the bills from both the House and the Senate into one with language that both parts of Congress could agree upon. The Restaurants Act is not to be confused with the restaurant relief fund, a separate fund that was part of the budget resolution amendment. After hearing the news regarding the Act, restaurant operators were sure to be eager to receive the funds. However, it was essential that owners use these funds appropriately. Once restaurants received the grants, they should have first used the funds to get out of debt. They should have covered any employee or operating expenses incurred during the pandemic that has yet to be paid off.

This would have allowed them to keep their doors open and continue operating. After paying off any debt associated with their company, restaurants should have aligned themselves with an expert who could guide and help them pivot during these unprecedented times. Pivoting is key to keeping up with changing consumer demand and to ensure your business’s products and services do not become antiquated. They can advise different methods to innovate and advise strategies to operate differently to ensure restaurant owners don’t end up in this same situation should an event like this ever occur again. Examples of pivoting that many restaurants (who otherwise did not offer these services before) have already begun implementing include services such as online ordering, curbside pickup, and delivery. While many establishments have these services built into their existing business model, restaurants far and wide began implementing them once the pandemic began, choosing to shift with changing demand. After getting out of debt and pivoting their company, the next step for restaurants would have been to set up additional profit centers to create congruent revenue streams. An example of this would be to create personalized, branded products that could be sold via an e-commerce platform. Other avenues include cooking shows and live music performances. Multiple profit centers help to diversify the company, minimizing operational risks. Optimization of the aforementioned strategies could also result in increased sales numbers, which was the case for Cousins Subs. The company worked extensively with their online ordering vendor, Olo, to integrate features into their operations to increase the efficiency of the food ordering and pickup process. For instance, Cousins Subs implemented automated alerts to inform their staff when a curbside customer arrives. Increased focus on curbside pickup and online orders led to a 17 percent sales growth for the company year-over-year as of September 2020. The Restaurants Act of 2021 proved to be just the boost this industry needed to get through the pandemic. Employees were able to stay on payroll and restaurants on top of their liabilities. The business landscape has changed dramatically since the pandemic began. Consumer demands have shifted, and financial hardships have set in. The Restaurants Act of 2021, coupled with the strategies above, was essential to the survival of many companies in the industry. If implemented correctly, these companies would have been able to continue building a sustainable, scalable, and sellable business and, if they want, to exit rich.  – Source: fsr magazine.

Mayor de Blasio says proof of vaccination or a negative COVID test should be “seriously considered” as a requirement for dining onsite. In the meantime, he’s urging restaurants to adopt a mandate voluntarily . . . .

As Vaccination Requirements Surge, NYC Eyes One for Restaurants

New York City needs to seriously consider limiting dine-in restaurant service to customers who can prove they’ve been vaccinated against COVID-19, Mayor Bill de Blasio said during a round of media appearances on his efforts to avert another spike in infections. He also issued what his office termed “an official call” for restaurants and other businesses with direct consumer contact to voluntarily require proof of vaccination or negative COVID tests from guests as a condition of entry. “Any private sector entity, go ahead and do a full mandate,” de Blasio said Tuesday on the MSNBC show Morning Joe. “If that’s something you feel you can do and works for you, do it now. Everyone’s in a different situation but go as far as you can go right now because we have to stop the Delta variant.” The mayor was referring to the more contagious form of the coronavirus that now accounts for most new infections. Its rapid spread has triggered a sudden wave of governmental requirements that certain workers be vaccinated or provide proof on a weekly basis that they are not carrying the coronavirus. Mandates have not yet been issued for restaurant workers and customers. But 500 bars in San Francisco agreed Monday to limit entrance to customers who can prove they’ve been vaccinated or recently tested negative for coronavirus. Patrons lacking the proof can still be served in outside areas. The voluntary measure, coordinated by the SF Bar Owner Alliance, was endorsed by San Francisco Mayor London Breed and the Golden Gate Restaurant Association. De Blasio has already imposed a requirement that all individuals employed by New York City either provide proof of being vaccinated or test negative for the coronavirus on a weekly basis, starting Sept. 13. The requirement goes into effect for healthcare workers on Aug. 2. The Democrat aired the possibility of a proof-of-vaccine requirement for dine-in restaurant patrons during an appearance over the weekend on The Brian Lehrer Show, a popular public radio talk show. Lehrer asked de Blasio what he thought of the vaccine mandate that French President Emmanuel Macron proposed as a condition of entry to his nation’s restaurants, cafes and bars. The mayor replied, “I’m not always the biggest Marcon fan, but in this case, I think that’s a direction we need to seriously consider…the delta variant is changing this game rapidly.” Macron’s proposal was approved by the French parliament a few days later, triggering riots by protestors who see a vaccine requirement as a limitation of their freedom. Among the objections raised in the U.S. to proof-of-vaccination requirements has been the difficulty of determining who’s received the shots and who hasn’t. Persons who’ve received the shots are provided with a card bearing hand-written information. Opponents note that the cards are not very durable and would be easy to counterfeit. But the state of New York has a proof mechanism called the NYS Excelsior Pass, a state-sanctioned smartphone app that indicates the bearer’s vaccination status. It is the only state to have what’s known as a vaccine passport. France and a number of other nations have similar passports—in the case of France, something known as a health pass. California is creating a state-run portal that allows residents to upload their vaccination records. Gov. Gavin Newsom pledged Monday to make it the “strongest vaccine verification system in the U.S.” He also announced that he intends all state employees to provide either proof of being vaccinated or proof that they tested negative for coronavirus during the prior week. Texas, Florida and other states have prohibited counties and municipalities from issuing vaccine passports. In the instance of Florida, passports are even outlawed for private businesses. – Source: Restaurant Business.

The sports bar hopes to triple in size by 2027 . . . .

Twin Peaks Uses Mountain-Sized Momentum to Create Growth Opportunities

Twin Peaks claims to have the coldest beer in the business, but its growth strategy is bringing the heat.  At the close of July, the sports bar stands at roughly 80 units, with about 55 of those owned by franchisees. By the end of 2021, Twin Peaks should expand to 90–91 restaurants, including openings in places such as Amarillo, Texas,; Kansas City, Missouri; Columbus, Georgia; Fargo, North Dakota; and Myrtle Beach, South Carolina. Internationally, it’s the same story. Twin Peaks opened its first Latin America location in Mexico City in November 2020, and two more are planned for later this year. With a goal of signing one to two international deals, the chain now has its eyes set on rapid development in regions like Eastern and Central Europe and Southeast Asia. CEO Joe Hummel projects the brand will top the 100-unit mark sometime in late summer 2022. And by the beginning of 2027, Twin Peaks should be at more than 275 stores. “We have a lot of interested franchisees,” Hummel says. “Our current franchise base is very aggressive, taking advantage of a lot of strong real estate that became available during some of the tougher times of COVID. Our brand was able to withstand that were some of the other brands weren’t able to withstand it. So our teams have been attacking that real estate, which has afforded us a lot of great abilities for growth.” A crucial part of the expansion effort has been investment in leadership. Earlier this year, Twin Peaks brought on Glenn Moon and John Brisco—industry veterans with decades of experience—to handle domestic and international franchise development, respectively. Moon came to Twin Peaks with more than 15 years of experience in hospitality investment, real estate development, and franchise sales experience. He’s spent most of his career with major hospitality brands like Hotels International, Wyndham Hotels & Resorts, and Best Western Hotels & Resorts. Brisco joined the company with over 30 years of executive international and domestic development wisdom. He’s responsible for Ruby Tuesday’s international business plan and expansion into 38 countries in five years. Brisco also worked at Sbarro, where he signed agreements for 1,000 stores to be developed over the next decade. “Well obviously they’re seasoned executives who are used to deal structure and have a lot of great context in the world of franchising,” Hummel says. “Glenn comes out of the hotel segment, so he has a lot of strong context there with people and partners that understand land development and large capital X projects. John, he’s opened in probably 75 different countries over his career in the thousands of units.” “So we’re excited,” he continues. “Both of those two have helped us really write our five-year vision plan to exceed 275 stores over the next five years. They were very instrumental in helping us see that roadmap based off of their knowledge and what they felt the depth of this brand could take out domestically and internationally.” As Brisco, Moon, and the development team sign deals, they’re offering franchisees a suite of flexible options that don’t handcuff them to a certain piece of real estate. Hummel notes the past eight openings have resulted in “tremendous” AUVs, and he attributes that to the vision of Chief Development Officer Michael Locey, Senior Director of Design and Development Paul Stevens, and Director of Construction Robert Pulley. Each collaborates to analyze what older stores provided guests, and where they missed opportunities. Twin Peaks is able to capitalize on those missed opportunities with new builds, but the chain is also flexible enough to take on many second-generation buildings that didn’t make it to market or died off because of age. “When you think about the lodge itself, no lodge is really the same wherever you go out and about in the mountains looking at different lodges,” Hummel says. “That’s our approach with our buildings. We have a prototype. We maximize space, outdoor space, indoor/outdoor bars. Obviously many, many TVs anywhere from 65-75 inches to 205 inches. Our partners down in Bryan, Texas, just put in a 205-inch TV. So always playing with the design.” Sales certainly aren’t impeding growth. The chain saw positive same-store sales in its fiscal 2020 year-over-year, and in the current quarter, comps are double-digit positive against 2019. Additionally, off-premises rose from a nominal amount pre-pandemic to 5 to 7 percent of sales. Hummel acknowledges the off-premises mix isn’t as high as other casual-dining chains, but he’s happy with the lift and knows Twin Peaks will always be an experiential on-premises brand first and foremost. That’s why onlookers shouldn’t expect future growth efforts to focus heavily on ghost kitchens or virtual brands. With Twin Peaks spending so much time on the in-store atmosphere, restaurant kitchens are busy and don’t have excess space or downtime to cook additional brands for delivery. However, that doesn’t mean the brand will completely remove itself from the discussion. Hummel says the brand has tested some virtual brands in the Dallas-Forth Worth market and the results have been pleasing. The CEO believes the delivery-only concepts could potentially result in a bump in sales, but he’s very cautious about making sure kitchens aren’t overwhelmed and that the on-premises guest comes first. “We’ll continue to explore, play with it, utilize it, where we have some opportunities,” Hummel says. “Maybe there are some gaps in the day that we can fill in, but our primary focus is Twin Peaks and that guest that comes in on a daily basis. And then supply chain is always fun to deal with, and we want to make sure the Twin Peaks brand has the proper supply chain. … The supply chain has been challenging for everybody over the last three to six months, and we want to make sure our supply chains stay focused on the Twin Peaks guest and not a one-off virtual brand that doesn’t have a huge brand affinity like ours.”

With that on-premises focus in mind, Twin Peaks is exploring how it can incorporate the budding sports betting market inside its restaurants. Fellow sports bars Buffalo Wild Wings and Hooters have already hopped on the train. In September 2019, Buffalo Wild Wings announced a partnership with MGM Resorts International and its sport betting venture, Roar Digital. In March 2020, Hooters activated sports betting in select markets through KonekTV, which displays real-time game statistics, analytics, and odds from BetRivers Sportsbook. Hummel says Twin Peaks has partnered with some consultancy groups in Las Vegas to understand the best way to move forward. The company was forced to place the venture on hold due to the pandemic, but talks are now ramping back up. The global sports betting market is expected to grow by $134 billion from 2020 to 2024, according to Technavio, a global market research firm. “It’s certainly something that we’re going to continue to peel back and look at because it’s a natural fit for our brand,” Hummel says. “We obviously are the best sports bar in the country, and why wouldn’t we complement our guests with some of those potential opportunities also when it comes to sports betting and gaming?” What’s to stop Twin Peaks momentum? The supply chain and labor shortages have definitely played a factor, Hummel says, but not to the point that it’s prevented development. Lumber and steel have escalated in costs and require longer lead times, but Twin Peaks’ construction and design team proactively purchased equipment and stored materials in warehouses. Workers are also value engineering pieces of equipment to mitigate some of the cost increases. In terms of the labor crisis, there have been shortages in the construction field, but Hummel notes that Twin Peaks has forged solid relationships with contractors, which has minimized the number of delays. At the store level, Hummel says labor has “hurt other brands more so than us.” Each day operators spend a great deal of time monitoring the size of shifts to ensure they not only accommodate guests, but also the well-being of employees. As the CEO explains, Twin Peaks and its current success are fueled by culture and the strength of employees. That’s exactly how the brand plans to continue its winning streak for the rest of 2021 and into 2022. We always say to ourselves as we look at our success or our growth, let’s make sure we govern ourselves with innovation, evolution, and build something to last,” Hummel says. “And that’s whether it’s the building, the employees, a food and beverage offering, partnerships—we want to understand our guests and be narrow and deep on what we know our demographic is.” – Source: fsr magazine.

The chain thinks it will cross 1,000 stores in the next three years. Bojangles wants to open 100 restaurants per year . . . .

Bojangles Dreams of Becoming the Next Global Chicken Brand

Bojangles’ strategic roadmap is supported by a tripod of operational and cultural infrastructure, explains Chief Growth Officer Jose Costa. The first leg is the foundation, which is about running flawless operations while maintaining the speed of service, product quality, and maintenance of facilities. The next support beam is modernization—bringing relevancy to the brand, both inside the store and outside the four walls through an omnichannel strategy. The final revolves around the growth of top-line sales and unit count. That’s how Bojangles plans to expand beyond its 775 restaurants across 18 states. Right now, the chain is primarily known throughout the Southeast, with strongholds in the Carolinas, Virginia, and Georgia. But Bojangles wants to shed its status as a regional brand and promote contiguous growth to areas like Dallas, Houston, Orlando, Pennsylvania, New Jersey, and New York. Bojangles wants to become a global chain, with goals of opening 100 restaurants per year. “We have over-hired across the organization to be a national and international brand,” Costa says. “Probably 80 percent of my time is focused on domestic growth. And as we embark into the second half of the year and 2022, the other 20 percent will increase on the international front. But we will be crossing the 1,000 mark in the next three years approximately. We want to be a national brand. That’s what we’re building toward, and the team we put in place, everyone we’ve hired—our dreams are big.” The quick-service brand is in a position to accomplish those feats with three profitable dayparts and an AUV of $1.9 million. Bojangles is also in the chicken category, which Costa says is the fastest-growing protein domestically and internationally. To his point, chicken entrees at U.S. restaurants increased 4 percent in the year ending April 2021, according to The NPD Group. The brand is setting this bar for itself almost three years after being sold for 593.7 million to Durational Capital Management and The Jordan Company. Before that, the chain was public for roughly three years. At the time of the transaction, same-store sales declined 0.2 percent in the previous quarter, with a 0.8 percent drop at corporate units and a 0.1 percent slip at franchised stores. To kickstart a turnaround, the chain rolled out a “restaurant portfolio optimization program” to close underperforming stores and refranchise others. Costa says the first two years under new leadership were spent working on the foundation and fueling modernization. In year three, the pipeline is building, especially after the installation of Bojangles’ first franchise sales team. The new group covers regions, whereas in the past, everyone was responsible for the entire country. Sales team members Eric Roschel (Northeast), Mark Levis (Southwest), Tarji Carter (Midwest, Alabama, Mississippi, and Puerto Rico), and Leigh Ann Stump (Southeast, Ohio, and Indiana), have years of restaurant development experience at brands like Papa John’s, Krystal, Papa Murphy’s, Checker’s, Captain D’s, Domino’s, Dunkin’, Cinnabon, Edible, and more. “We spent two years fixing processes, tools, and becoming a lot more analytical or scientific on our approach to go-to-market and building the right tools, processes, and hiring the right team,” Costa says. “And I think right now we’re in a good place from the way we think about prospecting, screening franchisees, training franchisees. Our training program today is six months. [Before] the new team, it was a fraction of that number. We pride ourselves on identifying good operators, training them the right way, and empowering them to run great restaurants.” Bojangles searches for franchisees who work inside the restaurant each day and meet with customers and employees. It also prefers individuals/groups with capital, perseverance, and a large, diverse restaurant portfolio. Each new operator learns the ropes through a 26-week training course at the chain’s “Bo University” training facility. The first big franchising deal of 2021 came when Bojangles signed a development deal with longtime franchisee Jeff Rigbsby to open 45 stores in the next seven years. Rigsby, who has been a Bojangles franchise for 20 years, will build stores in core markets Georgia, Kentucky, North Carolina, South Carolina, and Tennessee, and construct 15 units in new market Columbus, Ohio. In addition to this agreement, Rigsby acquired 16 company-run locations to become the largest Bojangles franchisee at 92 units. He’s projected to reach 100 stores by 2022. A couple of months later, Bojangles announced a 0 and 40” deal with Chaac Foods to open 40 new stores and acquire 40 corporate locations. The new units include 20 in Georgia, five in Tennessee, and 15 in Orlando, Florida. The company-operated stores are based in Georgia, South Carolina, and Tennessee. Then in June, Bojangles signed franchise agreements with Sajib Singha and Asish Baidya of SAT Restaurant Group and Khalid Siddiqui of LASH Foods to open three stores each in Dallas and Houston markets, respectively. While the franchisees grow those stores, Bojangles will add 15 company-owned stores in the Dallas-Fort Worth area.

The first franchised stores are planned for the first half of 2022, and the first corporate location will debut as early as Q1 2022. Of the franchisees approved to grow, 100 percent are expanding right now. Costa expects future development to be split 50/50 between new and existing franchisees. Company-run stores are expected to grow, as well. Bojangles currently has more than 270 corporate locations and hopes to reach a point where it can open 30 per year. “It just brings a different level of credibility when you’re able to tell your franchise system that you are the largest franchisee,” Costa says. “It gives us the ability to understand and manage the P&L. It gives us the ability to understand the challenges of labor, of product shortages, of everything that we’re facing right now when it comes to remodeling and reinvestment and investing in new equipment and new technology.” “A lot easier to say we are doing it ourselves for 275 restaurants versus some of the franchisors out there that are asking franchisees to write a check and they are not writing a check themselves,” the executive continues. “So we want to test everything ourselves first. We want to make sure it’s the right decision for the brand. And then the conversation is a lot easier if we already have almost 35, 40 percent of the system that we can make that change.” Bojangles provides franchisees with real estate flexibility with a host of development choices including the basic freestanding building—which comes in three different sizes—drive-thru only, endcaps, in-lines, express, and mobile units. In the next few months, Bojangles will test a ghost kitchen, as well. While the chain goes after franchisees and development, it’s ensuring the brand remains relevant. In August 2020, Bojangles revealed that it was dropping the apostrophe at the end of its name and relaunching the brand with new advertising, packaging, menu boards, uniforms, in-store visuals, and a refreshed logo. CMO Jackie Woodard told QSR that Bojangles evolved its logo to “create more distinctiveness through an ownable, timeless design that leverages the colors it’s been known for over the last 40+ years. The majority of consumers, who participated in our focus groups, preferred the new logo. They said it strikes the perfect balance between incorporating Bojangles’ heritage and moving the imagery forward.” The modernization won’t stop there. Costa says the brand is preparing to release a new design called “Genesis.” The Bojangles executive says the buildings will open in the next 60 to 90 days and are “completely different” from stores of the past. The time to grow is now. Or as the chain loves to say, “It’s Bo Time.” “The short-term dream is to be a national brand,” Costa says. “It’s contiguous growth. It’s dominating the trade areas where we serve our customers with different options from drive-thru only to in-line to endcaps—becoming a national brand and eventually a global brand. At our pace right now, we’ll cross the 1,000-store mark. From there it’s growing to 2,000, 3,000, 4,000, and so on.” “And It’s thoughtful. It’s supportive,” he adds. “It’s opening regional support centers to support our franchisees. It’s owning a lot of company-owned stores, so we know what the P&L feels like and what the challenges are. And it’s creating density so you can have enough marketing dollars to promote the brand and attract consumers.” – Source: QSR

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