Electrolux Professional to Acquire Unified Brands

Electrolux Professional has entered into an agreement to acquire Unified Brands Inc and related assets, a leading US-based manufacturer of foodservice equipment. The acquisition will significantly strengthen Electrolux Professional’s presence in the US and supports Electrolux Professional’s focus on growth with the foodservice chains. Electrolux Professional will acquire Unified Brands for approximately SEK 2,140m (USD 244m), on a cash and debt-free basis including certain tax benefits, subject to customary post-closing adjustments, from Dover Corporation, a US-based diversified global manufacturer and solutions provider. “We are very excited to announce this transaction, which is in line with our strategy to grow our presence in the US market as well as our focus on foodservice chains. Unified Brands has a very attractive portfolio of products and brands. With its strong local market recognition, customer relations, presence in chains, and local manufacturing capabilities, this acquisition will significantly strengthen our position in the US. I am also pleased that the management team of Unified Brands has agreed to stay in their roles,” says Alberto Zanata, President and CEO of Electrolux Professional. Unified Brands, founded in 1907, has approximately 600 employees and is based in Conyers, Georgia. Unified Brands is expected to generate approximately SEK 1,150m (USD 135m) in revenue in 2021. It operates two manufacturing and R&D facilities, one in Weidman, Michigan, and one in Vicksburg, Mississippi. The company and its Groen, Randell, Avtec, Power Soak, and CapKold brands offer cooking equipment, refrigeration, cleaning systems, ventilation, and meal distribution systems. Closing is expected to take place during the fourth quarter of 2021, subject to customary regulatory approvals. Following the acquisition, Unified Brands is expected to operate as it does today and will be reported as part of Electrolux Professional’s Food & Beverage segment. The acquisition is financed by internal funds and existing bank and credit lines. The net debt/EBITDA ratio after the acquisition is not expected to be above the company target of 2.5x. This information is information that Electrolux Professional AB (publ) is obliged to make public pursuant to the EU Market Abuse Regulation. The information was submitted for publication, through the agency of the contact person detailed below, at 03.15 a.m. CET on October 12, 2021. For further information, please contact Jacob Broberg, Senior Vice President Investor Relations and Communications +46 70 190 00 33. Source: Electrolux Professional’s Food & Beverage.

Caribou Coffee Adds Franchising to its US System for the First Time

Caribou Coffee on Monday introduced a domestic franchise program for the first time in the U.S. The 718-unit brand has previously franchised internationally and includes 314 company-owned locations, primarily in the Midwest. The program includes the chain’s “Caribou Cabin” prototype, which launched in 2019 with a drive-thru focus and smaller footprint, as well as Caribou’s traditional coffeehouse store model. In August, Caribou formed the fast-casual restaurant platform Panera Brands with Panera Bread and Einstein Bros. This collaboration gives Caribou access to Panera’s technology suite and its franchise owners, which could help it deploy its U.S. franchise program.

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Get the Daily Dive newsletter from Banking Dive, the free newsletter that keeps industry leaders in the know on the latest news and analysis. Franchising could drive a more rapid expansion for Caribou, especially since the chain will be pursuing smaller (and likely less expensive) retail space for its Cabin store model. The prototype yields strong sales and traffic, the company said in a press release, which could help attract operators. Dozens of these locations are currently open, and more are in development. The domestic franchising program’s launch also comes amid strong franchisee interest in restaurant franchisors with drive-thrus — a trend that could rake in a solid contingent of potential partners. According to the International Franchise Association, more than 26,000 franchised locations are expected to be added this year, with employment in the franchise industry to grow by more than 10%. “Recognizing Caribou Cabins’ immense expansion potential, we’ve optimized this business model through our corporate-owned locations and are focused on replicating the success we’ve experienced in new markets in partnership with the franchise owners,” Caribou CEO John Butcher said in the press release. Caribou is seeking multi-unit operators who have “extensive franchising experience” in the food and beverage space. This may reflect Panera’s franchising strategy since the fast-casual giant doesn’t sell single-unit franchises. Caribou is targeting markets throughout the U.S., including Michigan, Ohio, Illinois, Colorado, and the Southeast. The U.S. coffee market looks poised for a strong recovery, even though the pandemic wiped out nearly a quarter of the segment’s market value in 2020. Revenue in the coffee market is expected to grow annually by over 6% through 2025, according to Statista, while Allegra forecasts the growth to reach a 7% annual growth rate. The anticipated recovery may be why Caribou rival Dutch Bros Coffee’s IPO exceeded expectations in September. There are still risks in the coffee category, however. Although some workers are returning to offices, many companies are shifting entirely to remote work or maintaining a hybrid workplace, which could constrain the coffee segment’s sales by taking morning commuters off the road. – Source: Restaurant Dive.

Tropical Smoothie Cafe distinguished itself for 25 years based on its confluence of health, convenience, and taste . . . .

Why Tropical Smoothie Cafe is Bucking the Ghost Kitchen Trend

When it comes to one of the industry’s hottest trends, Tropical Smoothie Cafe, which recently crossed 1,000 locations, isn’t joining the herd. Ghost kitchens? CEO Charles Watson says they are not a part of the chain’s sizable growth plans. For Watson, it comes down to the brand’s roots as a franchisee-led organization. Since operators haven’t expressed overwhelming interest to jump in, it’s likely not in the company’s path forward. But the reasons go beyond that. “I see ghost kitchens, and they perform successfully for a lot of brands. But we’re just a traditional franchise model, and we think that we have a superior method of distributing our products,” Watson says. “We believe brands matter, visibility matters, and connection to the communities where we operate matters. And we think we can do that a lot better through traditional openings.” The U.S. had 1,500 ghost kitchens in July 2020, according to data from Euromonitor. And that number is only growing. Kitchen United announced it was teaming up with Kroger grocery stores and DoorDash officially launched full-service kitchens, just to name a couple of recent developments. Watson acknowledges ghost kitchens are a great, low-cost way to test markets and products. After all, the digital space has completely boomed out of the COVID trough, he says. Yet there are niche areas where it makes more sense than others. “Do I think it has legs? Absolutely,” Watson says. “However, I think it’s with specific brands and in certain geographies.” Highly populated markets like Los Angeles, New York, Chicago, and Miami present ample opportunities for ghost kitchens, but in the tertiary and secondary markets, Tropical Smoothie Cafe often targets, it’s not as clear-cut, Watson says. He believes the general population is still highly mobile with school, work, and kids’ practices all thrown into the mix, and street corner business remains vital. “What makes us different is that really big pipeline and that growth and the excitement about the brand and the excitement of communities that want Tropical Smoothie Cafe to open in their community,” Watson says. Tropical Smoothie Cafe distinguished itself for 25 years based on its confluence of health, convenience, and taste. Even though the main tenet of ghost kitchens for consumers is convenience, Tropical Smoothie Cafe long established its own strategy of offering consumers quick food, whether through ordering options or healthy customizations. Watson is clear, though: he’s not anti-ghost kitchens. He just doesn’t currently see them in the arc of Tropical Smoothie Cafe’s growth. Speaking of expansion, it has to be measured and sustainable for franchisee success, Watson says. He has watched other franchise brands explode, opening thousands of locations, and he says it doesn’t always end well. “Nobody at Tropical Smoothie Cafe gets a paycheck without the hard work that our franchisees do out in the field every day serving their guests and their communities,” Watson says. “So that partnership is so, so key. We’ve got to go ultimately at the pace that we can find great franchise partners.” Tropical Smoothie Cafe sold 270 franchises through Q3, and 70 percent were with existing franchisees. That, to Watson, is the greatest restaurant storyline—it shows his existing franchisees are enjoying work, making money in the business, and want to expand even more. Being on street corners across America helps with brand awareness, but expansion is all a “right place, right time, right franchisee” game, Watson says. When COVID hit, Tropical Smoothie Cafe wasn’t exactly a beneficiary, but it weathered the storm better than most, he adds. The brand almost reached its goal of opening 120 cafes in 2020 with 99 new units. More striking, Tropical Smoothie Cafe ended the year at 7.5 percent higher in comp sales. “It was the advent of digital, the advent of third-party apps, etc, and being able to stand up all those channels and utilize the technologies that were in the cafes or stand them up to go and capture that business,” Watson says. “Now that infrastructure is in place, that business has been captured, and now it’s about growing it.” Watson credits franchisees for ultimately powering through a stressful and difficult time, one that continues now with labor and supply chain issues. Job openings saw a high of 10.1 million in July, according to the Bureau of Labor Statistics. “They’re in there fighting the fight because at the end of the day, remember, this is their business,” Watson says. “This is their livelihood. They’re in there blocking and tackling every day. And I think that’s where a franchise model, especially like ours, can sometimes have some strategic advantage against more of a corporate-owned model.” The grit and determination exhibited by franchisees served the brand well over the past two years, Watson says. Some franchisees opened their first locations more than a decade ago on a shoestring budget and now have 5–10 units. Watson now expects Tropical Smoothie Cafe to open 150 units next year, up from its 130 goals in 2021 (of which the brand has already debuted 100). Chicago, Dallas, and Houston are prime expansion markets on deck. By 2024, Watson wants Tropical Smoothie Cafe to reach 1,500 locations with a $1.2 million average-unit volume. He sees no reason why the company can’t get average franchisee profitability well above 20 percent, either. “It’s all about balancing the growth of the brand with the profitability of the franchisees and driving the brand awareness across the country because a rising tide lifts all boats,” Watson says. “So the more people that know about and love Tropical Smoothie Cafe, from a guest perspective, the better we’ll all do.” – Source: QSR.

The pizza company’s chief experience officer Steve Seyferth sits down with NRN to discuss the brand’s epic 2020 . . . .

How Marco’s Pizza is Preparing Itself for Growth with Technology and Innovation

Marco’s Pizza is trying to be the fourth-largest pizza chain and, after a year like 2020, the quick-service restaurant is on the right path. “We’re surging ahead and looking to double operations in the next few years,” said Steve Seyferth, chief experience officer for Marco’s Pizza. Last year, the quick-service pizza chain saw same-store sales go up 24.7% year-over-year, but that wasn’t only due to the success of pizza and comfort food during the pandemic. In late 2019, Marco’s released a national ad campaign to bring awareness to the brand. The chain had also just launched an app and updated its tech suite around the same time, thanks to Seyferth’s influence as CMO at the time. Basically, the chain was ready for the pandemic. Since then, innovation and ease of experience have been top of mind for the chain following in the footsteps of Domino’s and its timely service. One program in the works is text-to-order, still in the testing phase, through which Marco’s Pizza is investing in younger consumers who no longer use online ordering. Video available with Marco’s chief experience officer for more information about the growing brand. – Source: NRN.

Dee Dee runs food from the kitchen to tables where staff then serve the food to customers . . . .

Robots Now Deliver Food, Bus Tables at Sawatdee

The Thai restaurant is using robots to run between the dining room and kitchen at its locations in Minneapolis and Maple Grove.  Sawatdee, the Upper Midwest’s first Thai restaurant that’s now in its second generation of family ownership, now appears to be the first restaurant in Minnesota to put robots in the dining room. And they’re called DeeDee. Sawatdee owners say that with the tight labor market, DeeDee provides extra help when they really need it and that staff and customers love watching the robots, which started work last week at the Minneapolis and Maple Grove location of the Thai restaurant. “I thought, why not? I’m having a really hard time getting staff. It’s not a bad idea getting extra staff,” said Cyndy Harrison, co-owner and daughter of the restaurant’s founder, Supenn Harrison. Or, in this case, robots. “Because we didn’t have enough people, we wanted to allow staff to not have so much burden,” said Harrison, “to not have them run around so much.” DeeDee is the first known robotic food runner and busser operating in a Minnesota restaurant and is designed for repetitive runs to and from the kitchen. That allows Sawatdee staff to focus on customers. It’s the latest wave of automation for the restaurant business, coming after ordering on iPads and viewing menus on cellphones became common during the pandemic. Now faced with more difficulties hiring staff, restaurants nationwide are turning to robotic food runners. The DeeDee robots are made by Bear Robotics of Redwood City, Calif., and they may lead restaurants to trim some jobs in the dining room. “It can eliminate one or two, depending on the size of a restaurant,” said Jim Livingston, a Bear Robotics vice president, “but the reality today is it’s not eliminating people because they can’t find people,” Servers could benefit by robots doing their kitchen runs by ultimately getting more tables, more time with their customers, and, therefore, more tips, he said. One thousand of the company’s robots have been rolled out. In Minnesota, the hospitality and leisure industry has been hiring but remains down 40,000 workers, or 14%, from February 2020, according to Hospitality Minnesota, a trade group. Data released earlier this month by the Minnesota Department of Employment and Economic Development (DEED) showed that the state unemployment rate last month ticked down one-tenth of a percent to 3.8%. Meanwhile, DEED noted that wages of restaurants and bars workers have been above $16 an hour for the last four months, unprecedented growth in the low-wage sector. Most restaurants lease the DeeDee robots from Bear Robotics for $33 a day, or about $4 an hour, for an eight-hour day. An equivalent staff member — if she could find them — would cost $12 an hour plus benefits and other costs, said Harrison. The California company’s field team programs each robot with a map of a restaurant’s layout. A kitchen staffer can hit a table number, press go, or even multiple tables in a row, with the robot making stops at each before returning to the kitchen. The robot is programmed to stop and wait when a customer walks in front or pulls out a chair. Two Minnesota senior living centers’ dining rooms are about to get their first robots, Livingston said. He expects robots serving food and drinks to become commonplace not only in restaurants, but also in casinos, hotels, and event receptions where they may stop for 30 seconds at a time at pre-mapped stations so attendees can pick up hors d’oeuvres. Sawatdee locations never before had a runner to help expedite food delivery, human or otherwise, Harrison said. With the DeeDees, she said servers now have more time to answer questions and take customer orders. “She’s very helpful when it’s really busy because there can be a lot of food in the kitchen that needs to get out and she can help get the food out faster,” Harrison said. – Source: Star Tribune, MN.

McDonald’s Targets Net Zero Emissions by 2050, From Meat to Energy

McDonald’s Corp. set a new target to cut global greenhouse gas emissions to net-zero by 2050, from the beef in its burgers to the light bulbs in its restaurants. The burger chain also said it was working with the nonprofit Science Based Targets initiative (SBTi) to revamp its existing climate change targets. It aims to lower absolute emissions by about a third for both its suppliers and its nearly 40,000 company-run and franchised restaurants around the world by 2030. “We’re trying to send a signal to our partners, to our investors, to our suppliers, to other brands in the global community, to policymakers, that we share that vision for 2050,” McDonald’s Chief Sustainability Officer Jenny McColloch told Reuters in an interview. United Nations scientists say the world’s net emissions must fall to zero by 2050 to limit the rise in global temperatures to no more than 1.5 degrees Celsius versus pre-industrial levels. Net-zero plans require companies to decrease carbon dioxide emissions and offset any remaining emissions using projects that capture the gas. More than 1,000 companies have signed similar pledges through the UN or SBTi. On Wednesday, funds managing nearly $30 trillion in assets called for 1,600 of the world’s most polluting companies to set science-based emissions targets, like wildfires, droughts and floods make slowing climate change more urgent. McDonald’s is one of the largest beef purchasers in the world. Roughly 80% of its total emissions come from its supply chain, in particular its use of beef, chicken, dairy, and other proteins. It will use new guidelines from SBTi, with which it already works, to focus on cutting emissions in agriculture, land use, and forestry. “Beef is a big opportunity to help drive impact in the world with our farmers and rancher partners,” McColloch said. McDonald’s 2050 net-zero goal includes emissions from direct sources like corporate offices and restaurants and indirect sources, particularly franchised restaurants and suppliers’ goods and services. – Source: Reuters.

Pizza chain Lou Malnati’s brings on a new investor, replacing BDT Capital . . . .

Deep-Dish Pizza Chain Lou Malnati’s Has a New Investor.

BDT Capital Partners, the Chicago investment firm that acquired a stake in the iconic pizza chain five years ago as it was beginning to expand out of state, sold its shares to Meritage Group for an undisclosed sum. Marc Malnati, who remains active in the pizza chain his father started 50 years ago, said he and his brother, Rick, remain the two largest individual shareholders. He wouldn’t disclose the size of the stake that BDT held and that Meritage now controls, and said the shift in investors won’t result in much change. “The pizza’s still going to taste exceptionally well,” Malnati said, and the chain intends to continue expanding. Malnati said BDT, which is headed by former Goldman Sachs investment banker Byron Trott, bought the restaurant chain when BDT’s investment funds were in the early stages. “They’re doing billion-dollar deals all across the world,” he said. “We’re a small family business.” BDT and Meritage, an investment group that manages more than $11 billion with offices in San Francisco, Greenwich, Connecticut, and New York City, did not respond to requests for comment. Meritage, according to Malnati, “tends to stay involved, invested in companies for the long term.” “We want deliberate growth coming out of COVID, and we want to give ourselves an opportunity to introduce the product in other cities in the Midwest where there is a big demand,” Malnati said. “We’re going to continue our expansion.” Malnati also said the chain’s Taste of Chicago business, which ships frozen pizzas to customers around the country, tripled during the pandemic. “During COVID when people were relocating around the country, and people weren’t able to get to Chicago to get their fix, that business has grown tremendously,” he said. Lou Malnati and his wife, Jean, opened their first restaurant in 1971 in Lincolnwood. The chain has more than 70 locations, including sites in Illinois, Arizona, Indiana, and Wisconsin. Lou Malnati’s had been considering bringing in a new investor for several months. Over the summer, the chain moved is headquarters into a facility in Buffalo Grove that will also house production and shipping for its mail-order pizza business. – Source: The Chicago Tribune.

Fifty/50 Group to Debut Restaurant at Chicago’s Willis Tower

EQ Office announced that Chicago’s Fifty/50 Group will debut the first full-service restaurant at Willis Tower. Kindling, a char-house-style culinary experience, will offer an urban oasis and convivial atmosphere in the heart of Downtown Chicago. Slated for 2022, Fifty/50 Group’s latest concept will occupy a two-story space and outdoor terrace at the corner of Franklin St. and Adams St., as part of Willis Tower’s Catalog, Willis Tower’s expansive and immersive dining, retail, and entertainment experience. The concept will present an engaging style of cooking with a large wood-burning grill that will serve as the hearth and heart of the main floor. Executed by Simeone Deary Design group, patrons will be surrounded by elements of nature and will enjoy curated artwork, lawn games, and craft cocktails. On level 2, overlooking Adams Street, guests can take in an unbeatable outdoor dining experience in the Loop. “Willis Tower is the perfect location for our group’s newest concept as we seek to infuse the sights, sounds, and aromas of the city to bring back warm memories of family and community—something our guests have missed most during the pandemic,” says Scott Weiner, co-owner of the Fifty/50 Group. “Whether you’re a professional looking to entertain, a visitor of the Tower’s world-renowned Skydeck, or resident seeking to rediscover the vibrance of the Loop, we want our guests to be invigorated by our bold flavors and the awe-inspiring views you get from an oasis hidden in between skyscrapers.” At the core of its menu, the restaurant will emulate Midwestern favorites and thoughtful ingredients at an approachable price point. Guests can expect fare like rotisserie chicken, brisket, and halibut. The cocktail program will reflect the business-friendly yet the playful atmosphere of the concept, focusing on classics and patio favorites. “For our first full-service restaurant, we sought out prominent restaurant operators in Chicago that reflect Willis’ ethos and would complement our vision. We met and quickly fell in love with Fifty/50’s concept. The name of the restaurant, Kindling, refers to our shared purpose – to kindle new connections and inspire new relationships,” adds David Moore, Senior Vice President and Portfolio Director at EQ Office. “With a live-fire cookout and park-like experience, Kindling will be serving one-of-a-kind dishes while pulsating with spontaneous energy and lively social interaction that you can’t get through Zoom. This is the perfect extension to the kind of experience that we’re creating at Willis for our customers and guests.” Willis Tower is completing a more than $500 million renovation project, the biggest restorative transformation in the building’s 48-year history. The concept is Catalog’s first full-service restaurant and joins the Tower’s impressive line-up of culinary offerings, including Rick Bayless’ Tortazo, Lettuce Entertain You’s Sushi-san, Sweetgreen, Shake Shack, Do-Rite Donuts & Chicken, and Brown Bag Seafood Co. Visit www.WillisTower.com for more information. The Fifty/50 Group is one of Chicago’s fastest-growing hospitality groups and owns and operates 14 dynamic restaurants and bars across the city, including the Berkshire Room, West Town Bakery, Utopian Tailgate, and Steadfast. – Source: FSR.

The Focus Brands-owned concept is focusing on a new rewards app, as well as first- and third-party delivery . . . .

How Cinnabon is Expanding From the Food Court to the Front Porch

Focus Brands-owned Cinnabon doesn’t want to just be known as the snack you grab at the mall food court: they want you to pick up an order of cinnamon buns from your doorstep or down the street from a food truck. During the pandemic, Cinnabon has been working on spreading its wings, from introducing the brand’s first-ever rewards app, to opening ghost kitchens so more people can have access to Cinnabon treats, even when they’re not in a shopping center. “It’s a huge focus point for us to take Cinnabon street side,” Kendall Ware, chief brand officer for Cinnabon said. “We know we’re strong in malls and there are plenty more malls we can get into and continue to grow in, but we want to grow in non-traditional venues, food trucks, ghost kitchens, and whatever we can get our hands-on. We want to open the doors to experience the brand in a way that has not been done before.” For Cinnabon, that means looking at co-branding opportunities with their sister brands like Auntie Anne’s and Carvel, along with offering both third and first-party delivery and creating awareness for their customized rewards app. “Luckily our product travels well,” Ware said. – Source: NRN.

Friendly’s is implementing a turnaround strategy featuring menu, technology, and unit development innovation . . . .

Friendly’s Triggers Turnaround with Constant Innovation

Around this time last year, the COVID-19 pandemic pushed Friendly’s to the edge. After losing money and repeatedly borrowing under its credit facilities, the 86-year-old concept declared bankruptcy in November despite efforts to reduce cash burn and restore profitability. For $2 million, the roughly 130-unit chain was placed into the hands of Amici Partners Group, which is affiliated with Smoothie Factory and RedBrick Pizza parent BRIX Holdings. Craig Erlich, who was installed as president and CEO in January, says the new era began with a great reception, whether it was franchisees, corporate employees, local restaurant teams, or customers. He and his executive team traveled to as many stores and franchises as possible to not only convey where Friendly’s was headed but to also understand the opportunities and challenges everyone faced. “It was a great opportunity for me to communicate one on one, and we have made a lot of changes since then, and we’ve increased the communication to the system so that everyone really understands the direction we’re going and also why we’re going there,” Erlich says. Those changes that Erlich refers to revolve around multiple rounds of innovation, starting with the menu. To begin 2021, Friendly’s leveraged its nostalgia by bringing back what he describes as an all-star lineup of LTOs that were popular in the past, including the Heinz 57 Burger, Vermonter Burger, Hot Honey Super-Melt, Maple Pepper Bacon SuperMelt, Buffalo Chicken Entrée Salad, and Asian Chicken Entrée Salad. The “Fan Favorite” entrees, available from March until June, were viewed as an opportunity to regain credibility and trust, according to Erlich. The same is true when Friendly’s released make-your-own sundae kits ahead of Mother’s Day, Father’s Day, and graduation season, and a summer menu filled with seafood selections like the Buffalo Shrimp Quesadilla and new ice cream flavors, Superman (swirl of red, yellow, and blue fruit punch flavored ice cream) and Summer Breeze (lemon ice cream with lemonade flavored seashells and graham cracker swirls). To cap off 2021, the chain recently rolled out another lineup of LTOs, including Aloha Stir-Fry, Cajun Jazz Pasta, Steak Tips, and the Nutty Buddy Sundae. “We have hearty comfort cuisine, fun-themed ice cream treats for the kids,” Erlich says. “And we have a robust menu launch for 2022, so it’s a sneak peek of what we’re going to be doing for next year.”

The Nutty Buddy Sundae.

After investing in product news, Friendly’s drew customers in with a new Sweet Rewards Club loyalty program in which customers earn one point for every dollar spent and a $5 reward for every 75 points. Since launching in June, the program has received more than 500,000 signups and given away more than $1 million in free sundaes and Fribbles—a notable improvement over the previous program that relied on an email-based coupon system. Further doubling down on technology, Friendly’s revamped its off-premises strategy with a curbside delivery component, something Erlich says will be an asset in the Northeast once winter arrives. And to provide greater visibility and access to customers on a local level, Friendly’s created Facebook pages and individual websites for restaurants. Each of those implementations was an effort to reach Friendly’s core consumer—anybody and everybody. “I think when you look at families and you just look at the memories that were created by the visits to Friendly’s over the years, first dates, children’s birthdays, everyday celebrations for adults—I think our customer can be anybody,” Erlich says. “When you look later in the new technologies of social media and some of the loyalty programs and some of the other components that we’ve launched this year, we’re really going to go after everyone.” With the brand transformation fully underway, Erlich believes unit development opportunities are starting to present themselves. Roughly 30 years ago, Friendly’s had 850 stores. When Sun Capital Partners purchased the chain in 2007 for $337.2 million, there were 515 locations. Then approximately two and a half years ago, the brand operated173 locations. Erlich says the development team is utilizing a two-pronged approach, with the first part focusing on stabilizing existing units and maximizing their performance. The other portion of the plan is layering in new channels of growth. Soon, Friendly’s will debut a fast-casual model in Westfield, Massachusetts, built for quicker service and a more robust curbside and third-party delivery program. Erlich says the company was able to reposition a restaurant within the community and find better use of real estate. When the restaurant opens, Friendly’s will join a growing list of brands turning to fast-casual offshoots as a form of growth, including Flip’d (IHOP), Hoots Wings (Hooters), Buffalo Wild Wings Go, and P.F. Chang’s To Go. In addition to brick-and-mortar, Friendly’s is looking to open a handful of ghost kitchens throughout the Northeast to “plug any holes” where it doesn’t make sense to build a traditional restaurant. The first one is in Philadelphia, and a second location will open in Boston. The chain is also utilizing BRIX’s portfolio of premium brands by inserting Smoothie Factory as a virtual brand inside two restaurants in Connecticut. Early tests have brought forth positive feedback, which means the ghost kitchen strategy could expand to more Friendly’s locations. “I think when you look at the way our operations are today, implementing a brand such as Smoothie Factory was an obvious fit,” Erlich says. “It’s a nice balance. If you look at certain restaurants that are in the gym, healthcare, health, and fitness markets, smoothies tend to do very well there. Smoothie Factory right now is more of a regional brand down in the Midwest, but expanding into the Northeast, it seemed like a natural fit and synergy between our restaurants and our operations. I can tell you that just out of the gate, we’ve had some success and we’re continuing to observe.” The Amici team took on a brand that declared bankruptcy twice in less than 10 years, and Erlich is mindful of that past. But he also voices the importance of using available tools that weren’t present when court restructures took place. Among these new resources are a revitalized management team, including new Chief Experience Officer Roberto De Angelis, a P.F. Chang’s veteran, and CMO David Ellis, who’s previously held leadership positions at Uncle Julio’s, KFC, and Darden Restaurants. Erlich likes the use of the phrase, “Let’s think like a rookie,” and prefers to guide the company without letting past experiences get in the way of forward progress. He believes it’s wiser to proceed with a balance of both. “I think for me, it’s really been rewarding,” Erlich says. “From the beginning to talk about some of the strategies and things that we were going to implement, and now nine months in, to see all of the things that we were able to implement in such a short time and the positive feedback we’ve received, it just feels really good. I think the feedback has been positive. We’re moving in the right direction and we’re really, really excited for what we’re anticipating for 2022.” – Source: FSR.

US restaurants are facing shortages on everything from olive oil to chicken wings . . . .

Restaurants Have Faced Supply Chain Shortages for More than a Year

US restaurants are in the midst of an ingredient shortage. Seventy-five percent of restaurants were forced to change menu items due to supply chain issues, according to a recent National Restaurant Association survey. The association polled 4,000 US restaurants between Sept. 7 and Sept. 15. David Nayfeld, the chef and owner of Che Fico in San Francisco, has been adjusting his menu, as certain types of olive oil or cheese have been difficult to procure. That comes even when many of the items are locally sourced, he adds. “The supply chain issue seems to be so deep-rooted in every spectrum of what we’re doing,” says Nayfeld.

Why are restaurants tweaking their menus?

The need to swap out or let go of items on menus is related to the pandemic and stems from labor shortages at processing plants, higher transportation costs, and higher feed costs. Overall, prices for items like poultry, beef, eggs, and fish have been on the rise in the US—so some restaurants are turning to cheaper ingredients to soften the need of passing higher costs to customers. The supply chain issues have forced some operators to get creative with what they have on hand—for instance, grilling foods typically served raw or fermenting ingredients to extend their shelf life, according to Elizabeth Freier, director of menu research and insights at Technomic, a food service management consulting company. “Because of supply chain volatility, nimbleness will be table stakes, with operators ready to implement menu swaps that take advantage of more readily available and economic ingredients,” she wrote in an email. Big chains have also been tweaking their menus throughout the pandemic. Over the summer, Wingstop, a chicken wing restaurant chain, encouraged people to order chicken thighs, as prices for chicken wings rose. Meanwhile, McDonald’s in the UK grappled with a shortage of milkshakes. Some restaurants are pushing Congress to replenish the Restaurant Revitalization Fund, part of the American Rescue Plan, to provide grants for restaurants during the pandemic. The $28.6 billion federal relief fund ran out in Jun, fulfilling fewer than a third of the grants received. The sourcing challenges come on top of other problems restaurants have faced during the pandemic, including finding and retaining workers or turning to delivery to stay afloat. The shortages go beyond ingredients and include non-food items like plates and stemware, says Nayfeld. All of a sudden, restaurants don’t have enough glasses to serve water to guests, he says. – Source: Reuters.

A requirement was approved Wednesday by the City Council, and Mayor Eric Garcetti has already signaled his support . . . .

Los Angeles Moves Forward with a Vaccine Mandate for Restaurant Guests

Amid considerable controversy, Los Angeles’ City Council voted Wednesday to limit restaurant access to patrons who can prove they’ve been vaccinated against COVID-19. Mayor Eric Garcetti indicated last week that he favors the mandate, all but ensuring that the nation’s second-most populous city and standout restaurant market will enact the safety protocol. It would take effect on Nov. 4. Similar requirements are already in place in San Francisco, New York City, New Orleans, Philadelphia, and a number of counties nationwide. The Los Angeles measure exceeds those measures in its scope. It requires full vaccinations, not just one shot, and applies to bars, shopping malls, gyms, nail salons, and museums as well as restaurants. That breadth and the problems evident in other cities with a vaccine mandate for dine-in restaurant customers prompted city lawmakers to stress the need for amendments and additional regulations. One proposed that enforcement of the requirement is shifted to the Los Angeles Police Department and that any attack on an establishment’s employees as a result of the measure be regarded as a criminal act. Restaurants that fail to comply with the requirement would receive a warning for a first offense, a $1,000 fine for a second infraction, and up to $5,000 if it’s a repeat offender. More than half of San Francisco’s restaurants have had a run-in with customers over that city’s vaccine mandate, and 29% have experienced repeated friction, according to the Golden Gate Restaurant Association. The council member who favored public enforcement also called for the creation of a fund to compensate affected businesses for any additional training that may be needed. The Council agreed to consider that and other measures as separate proposals. Other stakeholders noted during the City Council session that more specifics need to be incorporated into the requirement. One member of the public besieged the members to include a provision expressly exempting outdoor dining areas from the mandate. Approval of the measure, technically an expansion of already existing civic codes, had been expected. It passed by a vote of 11-2. Opponents have repeatedly warned that the civic requirement is likely to create confusion on the part of consumers and businesses because it differs from the vaccine mandate that is already in place for Los Angeles’ host county. That regulation requires bar patrons but not restaurant guests to show proof of vaccination before being allowed entry. They also questioned the need for the mandate when new coronavirus infections have been declining in the city. The yea vote came as New York Gov. Katherine Hochul warned constituents that more vaccine mandates may be coming for her state. Through executive orders, proof of inoculation is already required of healthcare workers, teachers, and state employees. – Source: Restaurant Business.

BBQ Holdings will focus on the five-unit Tahoe Joe’s chain it won at auction, rendering Old Country Buffet and its sister brands dead for now . . . .

Famous Dave’s Parent Won’t Revive Newly Acquired Buffet Chains

BBQ Holdings bought a handful of buffet brands this week, but what it really wanted was steak. The parent of Famous Dave’s on Tuesday won a bankruptcy auction for Fresh Acquisitions which owns the five-unit Tahoe Joe’s steakhouse chain as well as the intellectual property for several defunct buffet chains, including Old Country Buffet, HomeTown Buffet and Ryan’s. But the company doesn’t plan to do anything with the buffets, CEO Jeff Crivello said Wednesday, rendering the building blocks of a one-time 650-unit buffet empire dead, for now. “We have no immediate plans to reopen any of the buffet brands,” he said. “Those are just IP that came alongside the transaction.” In essence, the company paid $5.2 million for Tahoe Joe’s, a chain of six steakhouses in California’s Central Valley that had been struggling before the pandemic. BBQ views the concept as a potential co-branding partner with its cornerstone Famous Dave’s barbecue brand. “Some of them we may add some Famous Dave’s items too. A lot of Famous Dave’s, we will probably add the Tahoe Joe’s items too,” Crivello said. Joe’s steaks are cooked using a pellet broiler, imparting a smoky flavor that is similar to the smoked meats served at Famous Dave’s. The co-branding strategy would be a continuation of BBQ’s existing efforts to combine Famous Dave’s with other restaurants. It has such an agreement with a Texas T-Bone Steakhouse restaurant in Colorado that is owned by a Dave’s franchisee, and could also pursue a dual concept approach with the 25 Johnny Carino’s Italian restaurants that are offering Famous Dave’s for takeout and delivery only. It is one part of BBQ’s three-pronged growth strategy that also includes opening new restaurants and acquiring additional brands. The company has been extremely active in the latter category recently, buying Granite City Food & Brewery out of bankruptcy before the pandemic and then acquiring Village Inn and Bakers Square this summer for $13.5 million. It has also picked up one-unit Clark Crew BBQ and two-unit Real Urban Barbecue. – Source: Fresh Acquisitions.

Water treatment specialist Pentair has completed the acquisition of beverage equipment firm Ken’s Beverage Inc (KBI) in a deal worth $80 million . . . .

Pentair Acquires Beverage Equipment Firm Ken’s Beverage Inc. for $80m

Headquartered in Montgomery, Illinois, KBI has provided beverage equipment such as fountain dispensers, brewers, and water filters to commercial customers for over 35 years. The company also specializes in equipment services such as installation and preventive maintenance. KBI has over 30 branches and over 300 trained technicians across the US, with offices located in Michigan, Wisconsin, Minnesota, Texas, and Louisiana. Pentair claims that the purchase of KBI will significantly enhance its product offering and its service capabilities for commercial customers across the US. Mario D’Ovidio, executive vice-president at Pentair, said: “We are excited about the addition of KBI and the new growth opportunities it brings as we advance our strategy to provide a full suite of products and services for commercial customers. “This acquisition further realizes our vision to be the leading provider of residential and commercial water treatment solutions, delivering smart, sustainable solutions that empower customers to make the most of life’s essential resources.” Ken Reimer, the founder of KBI and commercial services business development leader for Pentair Water Treatment Services, added: “We are pleased to become a part of Pentair. “With our shared commitment to delivering exceptional beverage services and solutions to our customers, I am personally looking forward to continuing to grow the service capability as part of the Pentair team.” – Source: FoodBev Media, UK.

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