KFC restaurants nationwide will add Beyond Meats’ plant-based chicken to its menus . . . .

KFC to Launch Plant-Based Fried Chicken Made with Beyond Meat Nationwide

The launch comes after years of testing from the Yum Brands chain and Beyond Meat to create a meat substitute that mimicked the taste and texture of whole muscle chicken, like chicken breast, rather than the ground-up consistency of nuggets. The two companies first tested plant-based chicken at an Atlanta restaurant in August 2019 — and sold out their limited supply in less than five hours. KFC then tested the new item in Nashville, Charlotte, N.C., and southern California two years ago. The popular fried chicken chain is counting on customers making healthier choices to fulfill typical New Year’s resolutions. “This is really about where the customer is going; they want to eat more plant-based proteins,” said Kevin Hochman, U.S. president of KFC. “It’s January, so it’s a time of New Year’s resolutions and wanting to do something different in your diet.” More Americans are embracing a so-called flexitarian diet in which consumers cut down on their meat consumption for health and environmental reasons. That has driven the growing popularity of plant-based substitutes. “From a supply perspective, we feel really good about it, and it’s something we have experience within initial trials,” said Beyond Meat CEO Ethan Brown. Hochman and Brown are so bullish on the product that they’re not deterred by the current nationwide surge in the Covid omicron variant. The partnership hits at the time of a national labor crunch, with many eateries running short-staffed. To run smoothly even with fewer workers, some chains have been reluctant to add new items or even scaled back their menus. Surges in new Covid-19 cases exacerbate those issues as workers call in sick due to positive tests or exposure to infection. Nearly a year ago, Beyond Meat announced a formal partnership with Yum to make exclusive plant-based substitutes for Pizza Hut, Taco Bell, and KFC. Chipotle Mexican Grill rolled out plant-based chorizo Monday at its restaurants nationwide. It also is targeting customers who are trying to eat less meat in 2022.

Ramping up for Launches

In preparing for launches to come in the new year, Beyond Meat poached industry veterans from Tyson Foods for its C-suite in December, adding Doug Ramsey as chief operating officer and Bernie Adcock in the new role of chief supply chain officer. Ramsey spent three decades at Tyson, overseeing its poultry and McDonald’s businesses. Adcock also spent 30 years at Tyson with a focus on operations and supply chain management. “We’re continuing to grow the operations team; they did a lot of work to help the team get ready in these final days,” Brown said, adding the Yum tie-up has been years in the making. “They’ve helped us prepare for this and we brought in, I think, some of the top executives in the industry.” Beyond Meat is looking to get its stock back on track. In the last 12 months, shares have lost half their value, dragging the company’s market value down to $3.9 billion. The stock closed Tuesday down 5% at $61.62 and short-sellers betting against the stock represent 37.2% of available shares, according to Factset. On the other hand, shares of Yum have climbed 30% in the last year, bringing its market value to $40.3 billion. Strong demand for KFC’s fried chicken has helped lift the price. The chain’s U.S. same-store sales jumped 13% on a two-year basis during its third quarter.

Synergies with Retail

The partnership does provide an opportunity, however, for “Beyond” restaurant sales. The company is hoping to attract more customers to its grocery store products, which sold briskly early in the pandemic, but then saw declines in subsequent quarters. “It has great synergies with what we are trying to do in retail,” Brown said. To promote the new menu item, YouTube star Liza Koshy will star in the plant-based chicken’s ad campaign, in the latest partnership between fast-food chains and influencers. However, KFC will not be targeting vegans and vegetarians directly with its marketing because the Beyond Fried Chicken is made using the same equipment as KFC’s traditional fried chicken. Customers can buy KFC’s Beyond Fried Chicken in six- or 12-piece orders, with dipping sauce included. Prices start at $6.99, excluding tax. – Source KFC.

They see a new interest in mushrooms, a rethinking of chicken and coffee, a resurgence of 1980s cocktails — and, believe it or not, a return to civility . . . .

 How Will Americans Eat in 2022? The Food Forecasters Speak

Trend forecasters say that laksa, a slurpable noodle soup served across parts of Southeast Asia, may rise in prominence in the United States in 2022.

Last year at this time, optimistic trend forecasters predicted that the cork would burst from the bottle by summer. With vaccines in arms, food culture would vibrate in a robust economy. American menus would be full of innovation driven by waves of international travel, and a new generation of digital-native cooks would rewrite the rules.

Clearly, the prediction game can be a losing one. But so what if things didn’t turn out like everyone thought they would? Trying to forecast food trends is still fun, and sometimes even accurate. (Kudos to those professional prognosticators who in recent years nailed the mainstream rise of quesabirria, soufflé pancakes, delivery-only restaurants, and CBD. And a special citation for those who saw early on that those ripples of veganism would become a plant-based tsunami.)

So how are things looking for 2022? Not great. The year is starting with a surge of a highly contagious variant of Covid-19 that is only adding to the economic uncertainty. Social-justice concerns remain top of mind for many, as does pressure from a fast-changing climate. All of it will affect how food is grown, cooked, and packaged.

But don’t despair. “Constraint breeds innovation,” said Anna Fabrega, a former Amazon executive who recently took over as the chief executive at the meal subscription service Freshly. She and other food industry leaders in the United States say 2022 will be another pragmatic, roll-up-your-sleeves kind of year, shaped by the needs of people working from home and by the culinarily-astute-but-fickle Gen Z, whose members want food with sustainable ingredients and a strong cultural back story, prepared without exploitation and delivered in a carbon-neutral way — within 30 minutes.

With that in mind, here are some potential developments, big and small, that could define how we eat in the new year, based on a review of dozens of trend reports and interviews with food company executives, global market researchers, and others who make it their business to scour the landscape for what’s next.

Ingredient of the Year

Cooks can expect to be using more mushrooms grown inside urban warehouses, like Smallhold’s in New York.

Mushrooms have landed on many prediction lists, in almost every form, from psilocybin mushrooms (part of the renewed interest in psychedelics) to thick coins of king oyster mushrooms as a stand-in for scallops. The number of small urban farms growing mushrooms is expected to bloom, and mushroom fibers will start to proliferate as a cheap, compostable medium for packaging.

Drink of the Year

Party like it’s 1985, with drinks such as the Long Island iced tea.

Even in the age of no-alcohol cocktails, all those 1980s drinks you can barely remember (for obvious reasons) are coming back. Look for Blue Lagoons, Tequila Sunrises, Long Island iced tea, and amaretto sours re-engineered with fresh juices, less sugar, and better spirits. “We all need things that are sweet and colorful and joyful and playful, especially now,” said Andrew Freeman, president of AF & Co., the San Francisco consulting firm that for 14 years has published a popular food and hospitality trend report. (A corollary to the cocktails: the rise of ecospirits, made with ingredients from local farms or food waste, and packaged and shipped using climate-friendly methods.)

Chicken, Re-hatched

Among the chicken trends being predicted: the continued rise of vegan substitutes. Meat grown in laboratories from animal cells is on its way to winning federal approval as soon as the end of 2022, and chicken will be one of the first products to become available. But plant-based chicken from companies like Impossible Foods and Beyond Meat have recently arrived in groceries and restaurants, and the battle is on to determine which substitute will dominate the market. And in the real-chicken world, a shortage of wings has restaurants trying to persuade the masses to love a different part of the chicken. The Wingstop chain, for instance, has expanded its brand with Thighstop.

Seaweed to the Rescue

The farming of kelp is catching on in Maine.

Kelp grows fast, has a stand-up nutritional profile, and removes carbon dioxide from the atmosphere and nitrogen from the ocean. As a result, farmed kelp will move beyond dashi and the menus at some high-end restaurants and into everyday foods like pasta and salsa.

Candy Nostalgia

The popular Netflix show “Squid Game,” from South Korea, made ppopgi — dalgona candy — a star.

Nostalgic childhood favorites from China (White Rabbit candy and haw flakes) and South Korea (the honeycomb-like treat ppopgi, a.k.a. dalgona candy, and Apollo straws) will work their way into American shopping carts and recipes for desserts and drinks. – Source: The New York Times/Kim Severson.

Full-service prices rose 6.6% as food-away-from-home inflation hit a 40-year high in December . .  .  .

Limited-Services Menu Prices Soared 8% in December

Fast-food menu prices soared 8% in December, according to new federal data released Wednesday, as the industry continues to pass on higher costs for food and labor onto customers. Prices for full-service menu items were not far behind, according to the U.S. Bureau of Labor Statistics, rising 6.6% annually. Overall, food-away-from-home inflation rose 0.6% monthly in December and 6% annually, the largest increase for the index since 1982. That was nevertheless below the 6.5% increase in consumer prices for food-at-home and 6.3% for food overall. But that hides the true impact of menu price inflation, given that free lunch programs have sent those prices down 64%. The industry is raising prices aggressively because their own costs have taken off. Restaurants are paying considerably more for both food and labor, their two highest cost inputs. On Tuesday, for instance, the pizza delivery chain Domino’s said that its food costs this year are expected to increase 8% to 10%. That is “three to four times” the normal rate of inflation, CEO Ritch Allison said. As a result of that as well as higher labor costs, the company is planning changes to its permanent value offers. Labor likewise continues to be a problem. Companies like El Pollo Loco are losing sales because of a lack of workers. And wage rates continue to take off. More operators today believe labor challenges could be a longer-term problem. “Labor tightness will be here for some time to come,” Frances Allen, CEO of Checkers and Rally’s, said at the ICR Conference earlier this week. At the same time, consumers themselves appear to be brushing off higher prices. Total restaurant sales have been up more than double digits from where they were before the pandemic in recent months. There’s a little disincentive, in other words, to keep raising prices to recover some of the costs. “We look at what our competitors’ pricing is, and priced accordingly,” Dan Accordino, CEO of the big Burger King franchisee Carrols, said at ICR on Monday. The company raised prices 8% in the fourth quarter, on par with overall fast-food inflation. “Over time, we generally have not seen a whole lot of pushback from consumers.” – Source: Restaurant Business.

Mexican casual-dining brand plans to offset increased commodity, labor costs with expanded February offerings, executives tell ICR Conference . . . .

Chuy’s will Introduce a 3%-3.5% Price Increase with New Menu

Chuy’s Holdings Inc. expects to raise menu prices by 3% or 3%-plus with the introduction of a new menu in February, executives said Tuesday. Steve Hislop, CEO, and president of the Austin, Texas-based casual-dining Mexican brand, said inflation in commodities and labor would lead the company to evaluate menu prices later in the year. “I’m pretty stubborn in my approach that I only like to do it once a year,” Hislop told a 2020 Virtual ICR Conference on Tuesday, “but as we go through the year will continue to look at the pressures of inflation on wages and our products — and will look at it and continue to look at the value proposition in all our markets — and I’m not averse to saying that I won’t take a second one.” Jon Howie, Chuy’s chief financial officer, said that commodity inflation ran between 7% and 9% in the last half of 2021. “What we’ve heard from our people in purchasing is they think maybe those prices will come down in last half of the year [but] still stay elevated on the five-year average standpoint,” Howie said. Labor inflation was about 8% in the third quarter, he added. The planned price increases include about half a percentage point in delivery, he said. Howie added that about 70% of delivery charges are being covered now. “With our price increase, we intend to cover 100% here in February,” he said, “so moving forward we should be able to offset all of those delivery charges,” Hislop said the brand’s restaurants are about 85% staffed and he was comfortable with that level. The company has worked at retaining employees, offering bonuses during the pandemic, he said. The company attracts new workers through current-employee referral bonuses and deploying newer methods like TikTok videos and recruiting at schools, colleges, and even day-care centers, where moms can be found to work several hours, Hislop said. The omicron variant of the COVID-19 pandemic has led to some shift exclusions, closed stations, and isolated delivery-only hours, he said, but generally, it has not posed a large problem. “It’s been crazy on the front lines, making sure we’re keeping these doors open and given the hospitality that everybody is expecting,” Hislop said. Turnover, however, has remained less than in comparable periods of 2019, he said. With the upcoming new menu introduction, Hislop said the brand is expecting to bring some menu items, seven or eight, back that were trimmed during the height of the pandemic. Those will “mostly be the combination sections of our menu,” he added.  Catering had been a Chuy’s initiative before the pandemic was declared in March 2020, and the company is slowly bringing those options back, Hislop noted. “I think in 2019 we ended the year with about 13 catering markets,” he said, “and we finally got back to that now. As we end this year, we’ll have six to seven more.” Catering orders have gotten smaller, he added, with fewer parties in the hundreds and more in the range of 25-50 people. During the third quarter ended Sept. 26, Chuy’s opened one new restaurant in Brentwood, Tenn., bringing the total restaurant count to 96. Chuy’s was founded in Austin in 1982 and has full-service restaurants in 17 states. – Source: NRN.

Hispanic cuisine businesses nationwide can begin applying for a COVID relief grant of $5,000 or more . . . .

Grubhub and the U.S. Hispanic Chamber of Commerce Launch $2 Million Grant Program for Latino Restaurants

Hispanic-owned restaurants, starting today through Jan. 26, can submit an application for a COVID relief grant provided by the USHCC Education Fund and Grubhub. The USHCC & Grubhub Restaurant Small Business Grant Program plans to distribute about 300 restaurant grants ranging from $5,000 to $10,000. Businesses from both urban and rural areas across the country are eligible to apply. Grants for COVID relief are provided by Grubhub’s Donate the Change Program. “Small businesses have faced a disproportionately difficult 18 months, and it’s crucial that we support them to ensure they remain part of the fabric in our communities,” said Kevin Kearns, senior vice president of restaurants at Grubhub. Grubhub says in order for restaurants to qualify, they must be Latino-owned, have been operating for at least nine months before applying, have a verified employer identification number (EIN), and have 20 full-time employees or less. Restaurant owners can find the grant program application here. USHCC became a partner of Grubhub’s Donate the Change Program during Hispanic Heritage Month in September 2021. The donations were distributed as grants and scholarships to Latinos who sought financial assistance. Ramiro A. Cavazos, president, and CEO of USHCC, said he sees the grant program helping to keep small local restaurants open longer. “As our restaurant industries work to re-open their doors and look towards recovering, they’ll need access to the resources and tools offered by the USHCC national network, now more than ever before,” said Cavazos. Restaurants in the U.S. have shown steady recovery coming into 2022, but Grubhub and USHCC agree that many are still fighting to avoid short or long-term closures. According to the National Restaurant Association, a study from Stanford University in 2020 found that “Hispanic-owned restaurants struggled to get economic relief from the government” during the pandemic. The most affected by a lack of COVID relief was Latina businesses, which closed twice as often compared to one owned by a Latino. – Source: Al Dia.

The Veganuary campaign launched as a nonprofit organization in the UK in 2014 . . . .

Restaurants, Food Brands Find a Partner in Veganuary

Veganuary turned nine this month with a record of inspiring a growing number of consumers to go vegan for the month. Last year, 582,000 people from 209 countries signed up for the 31-day pledge to leave animal products off their plates. The Veganuary campaign launched as a nonprofit organization in the UK in 2014 to educate consumers on the benefits of a plant-based lifestyle, encourage them to try it for a month, and support them on the journey. Forty percent of participants surveyed finished the 31-day challenge last year with a commitment to stick with a plant-based lifestyle long-term, a trend that’s helping fuel a bigger market for plant-based food brands, according to Veganuary’s organizers. This year’s signups signaled a new milestone – more than 2 million people have taken the pledge since 2014, and the group estimates that about 10 times as many people have actually participated. And, as the program has taken off, more food makers, restaurants, and grocers have found ways to partner with the campaign to promote their plant-based brands and products. Signups are highest in the UK, with the US, India, Germany, and Argentina rounding out the top five. Participation in the US has grown so much that the organization launched a US branch in 2019, and last year about 80,000 Americans took the pledge. Veganuary has assembled a star-studded list of vegan ambassadors to spread the message including Paul McCartney, Joaquin Phoenix, Alicia Silverstone, Peter Egan, and newly inaugurated New York City Mayor Eric Adams.  The effort has also attracted partners eager to highlight their plant-based offerings while so many consumers are paying attention. Last year marked the first time Veganuary had official corporate sponsors, and plant-based food makers Beyond Meat, Violife, and Good Catch signed on. Additionally, about 100 restaurants and food companies joined as partners in the US, which allowed them to use Veganuary’s materials for free to promote the campaign and market their plant-based offerings. That’s up from 35 in 2020. And it’s not just food brands that are taking the chance to promote their vegan efforts. Plant-based beauty and hair care brands Aveda and Pacifica are on the list of official Veganuary sponsors.

Why Veganuary?

People have different reasons for trying plant-based eating and vegan lifestyles, and the balance shifted last year. In a survey of 2021 participants, 46% reported taking the pledge for the animals, while 22% cited health reasons and 21% cited the environment. That’s compared to 2020 when health was the top reason with 38%, followed by animals and the environment with 37% and 18%, respectively. There’s some indication that health concerns became a bigger factor in the early months of the pandemic. US sales of plant-based meat alternatives grew 35% between April 12 and May 9, 2020, according to Nielsen, and they have continued to rise. Social media channels have helped spread the word and entice more people to take the pledge. Signups aren’t limited to January — consumers can take the pledge to go vegan for 31 days any time of the year — but this time of year typically brings the biggest number of participants, US Director Wendy Matthews said last year. Forty percent of 2021 participants surveyed said they planned to stay vegan, compared to 72% the previous year, and 75% of the respondents who didn’t plan to stay vegan said they would be cutting 50% or more of the animal products out of their diets. Half of the participants surveyed reported improvements in their health during their month of plant-based eating and 93% said they would be at least somewhat likely to try it again. As consumer participation in the program has grown and year-round demand for plant-based options continues to rise, restaurants and food makers have launched and promoted new menu items and products around Veganuary. The pandemic has also put financial pressure on consumers, giving Veganuary another talking point. A study released last year by Kantar found that plant-based meals prepared at home can cost as much as 40% less than meat- or fish-based meals. The survey found that vegan households spend an average of 8% less on groceries than non-vegan families. Veganuary embraced that message and created a budget-friendly meal planner. A big part of Veganuary’s effort is focused on supporting participants to make it easier for them to make the switch, which includes a mix of practical information on diet and nutrition, as well as recipes and meal ideas to keep things interesting. Serious issues of animal welfare and the environment can be part of the discussion as well, but there’s also the fun factor and the reminder that we don’t have to be perfect to make positive changes. Vegan TikTok influencer Tabitha Brown made that point last year with whimsy in a video spot that both counts down the month with a variety of colorful and indulgent vegan meals and also illustrates the need to forgive ourselves and move on when we make mistakes. All of the resources are free for participants who sign on to take the challenge, including a celebrity e-cookbook and access to a private Facebook group where they can ask questions and share information, Matthews said. Brands can still partner throughout this month to promote their vegan products and add to the growing conversation about all the reasons to consider going vegan — and staying — vegan, she said in an interview last year. “We at Veganuary feel it’s important to educate people on all the reasons to go vegan because different things resonate with different people. We also need to make it fun and easy, so the community is very important to make sure that people are feeling supported and like they have allies.” – Source: Smart Brief.

Food and Restaurant Trends for 2022 Include Robots, Sustainability

As 2021 draws to a close, food and restaurant experts are making their predictions for the trends that will shape the way we eat in the coming year. This past year was another difficult one for restaurants as the pandemic continues to stir up uncertainty around everything from safety protocols to supply chains. Some of the top trends on the horizon for next year are reactions to how the pandemic has affected foodservice and consumer habits, while others are continuations of movements that have been steadily growing since before the pandemic. Here are five of the most-talked-about trends that you can expect to see playing out in restaurants and on grocery store shelves in the year to come:

Robots in restaurants

The pandemic sparked a surge of technology investments among restaurants as they ramped up digital ordering capabilities and touchless payment options, and 2022 will see many restaurants go even more digital. “Accelerated adoption of robots and other forms of automation in the restaurant industry will be the #1 trend for 2022…and for years beyond,” food and restaurant consulting firm Baum + Whiteman said in its 2022 trend prediction report. The Takeout also included robots on its list of 2022 trends, noting that automating certain tasks can help alleviate some of the strain restaurant operators are feeling from being understaffed, as well as reduce the spread of germs by minimizing person-to-person contact. Jim Balis, managing director of CapitalSpring’s Strategic Operations Group, also noted the benefits of robots for restaurants in his recent remarks to FSR, saying that robots can allow restaurants to reduce staff hours and minimize liability when it comes to safety and sanitation. Many restaurants are already using robots to assist with flipping burgers, bussing tables, and taking orders – an area where Balis sees particular potential for growth. He predicts thousands of restaurants may add voice artificial intelligence capabilities to drive-thrus by the end of next year.

Streamlined menus

Supply chain challenges brought on by the pandemic are forcing many chefs and restaurant operators to change menus on the fly and get creative with whatever ingredients they are able to get. The new year will likely bring sweeping changes to menus to accommodate rising food costs and focus on local ingredients that are more reliably available. “2022 dining menus will see a streamlined, localized approach that will keep in line with what is locally fresh and readily available, forcing chefs to innovate their menus with ingredients and products already on hand due to the current state of industry hurdles,” RJ Cooper, owner, and chef of Nashville, Tenn., restaurant Saint Stephen told Food & Wine during the magazine’s survey of chefs. Downsized menus also showed up on Technomic’s list of 2022 trends as well as the National Restaurant Association’s What’s Hot 2022 Culinary Forecast, which put “streamlining menus” as the No. 6 trend for the coming year.

Booze-free beverages

One of the biggest food and beverage trends of the past year is alcohol-free beverages, with sober curious consumers driving demand for sophisticated soft drinks. This category is expected to continue its massive growth in the new year, with Baum + Whiteman, The Takeout, Whole Foods Market, and the Speciality Food Association all including booze-free beverages in their 2022 trend predictions. “The low- and no-alcohol trend is booming and one new area within it is dealcoholized wine,” said Kara Nielsen, a member of the Specialty Food Association’s Trendspotter Panel. Several chefs surveyed by Food & Wine mentioned the growing popularity of zero-proof cocktails with flavor profiles that can hold their own against drinks made with liquor. “These new drinks are no longer simply a mix of fruit juices but feature an elevated eye appeal with fresh, seasonal ingredients,” said Fernando Soberanis, executive chef of Laurel Brasserie & Bar in Salt Lake City, Utah. The continuing popularity of alcohol-free beverages may also spark new types of drinking occasions. Pinterest predicts that “afternoon tea will be the new happy hour” in its trend report. Marketing firm AF&Co also sees more tea parties in store for 2022, as the tea service at Thaimee Love in New York City, which features the color-changing butterfly pea flower tea.

An eye on the environment

Another movement that will continue growing in 2022 is a focus on foods, packaging, and business practices that minimize damage to the environment. Many experts foresee continued growth for plant-based foods, which made a strong showing in the National Restaurant Association’s What’s Hot report, with plant-based burgers, sandwiches, and breakfast sandwiches among the top trends in the dinner, lunch, and breakfast dayparts, respectively. Among the 350 professional chefs surveyed for the report, plant-based foods were predicted to be the second-hottest trend in 2022, coming in behind sustainability. Sustainable packaging ranked as the top trend for 2022, according to the report, and it’s likely that many restaurants will make efforts to offer recyclable or reusable packaging in the coming year as consumers continue to rely on off-premises dining. In addition to plant-based foods and sustainable packaging, The Takeout predicts the rise of more alternatives to products that have a large environmental impact, such as coffee, while Whole Foods sees a bigger future for “grains grown via agriculture practices and farming processes that help address soil health.”

Food with roots

While growing concern for environmental issues has consumers focusing on the future, they’ll also be looking to the past to seek out dishes with ancestral roots, some experts predict. “Questions about where our food comes from have gotten much more complex as chefs and artisan food producers of color have started to dig deep into very specific culinary traditions,” according to AF&Co, which included “food with history” on its 2022 trend forecast. The marketing firm predicts more chefs and food makers will bring back “ingredients and techniques that have been misappropriated or all-but disappeared.” Baum + Whiteman also mentioned heritage cooking as a top trend for 2022, predicting the coming year will bring “deep explorations of narratives, histories, and roots of cultures and cuisines hitherto neglected by mainstream media,” with a focus on African American foodways as well as the cuisines of Thailand, Korea, and the Philippines. Pinterest’s forecast of a growing trend around “ancestral eats” supports this theory. Searches on the social media platform for ‘authentic’ and ‘heritage’ recipes have been on the rise, with searches for “Filipino recipes authentic” up 35% and “South African recipes traditional” up 150% between October 2019 and September of this year. – Source: SmartBrief.

Starbucks will Spend With Diverse Suppliers by 2030

The company said that it would spend $1.5 billion with suppliers owned by Black, Indigenous, and People of Color. The coffee giant spent nearly $800 million last year. Starbucks said on Tuesday that it plans to double its spending with diverse-owned suppliers, to $1.5 billion, by 2030 as part of its ongoing effort to improve its track record on diversity. The company spent nearly $800 million with diverse-owned suppliers in its most recent fiscal year. The announcement comes a year after Starbucks vowed to improve its efforts on diversity by regularly reporting the makeup of its current workforce and by holding executives accountable for taking steps to improve the culture of inclusion throughout the company. Dennis Brockman, Starbucks chief global inclusion and diversity officer, told employees in a letter this week that the company has the ability to “reframe and normalize diversity.” “As a 14-year partner, I’ve prided myself in living Starbucks’ mission and values with a clear approach: real inclusion requires intent,” he wrote. “When we do that, we have the power to reframe and normalize diversity.” Starbucks’ effort follows a similar commitment being made by McDonald’s to increase spending with diverse-owned suppliers—taking the companies’ own diversity-in-hiring efforts and expanding them to include the food manufacturers and distributors with which they work. Starbucks said it has a supplier diversion and inclusion program, and that its spending supported more than 6,400 jobs last year and generated an economic impact of $1.2 billion. The company said it would work with other organizations to develop and grow supplier diversity around the world as part of its commitment to increase spending. Starbucks said it is launching along with Arizona State University an “open-source toolkit on the fundamentals of how to run a successful business” for diverse-owned entrepreneurs. The company also said it would allocate 15% of its advertising spending with media owned by historically marginalized groups or targeted at such audiences. In addition, Starbucks released some data on its workforce. The company said 71% of its U.S. partner base was female and 48% was Black, Indigenous or People of Color, including 28.5% Hispanic or Latino and 7.7% Black. The company said it wants at least 30% of employees at corporate levels, and 40% of workers in retail and manufacturing roles, to come from underrepresented groups by 2025 in the U.S. Starbucks said it is tying the building of an inclusive and diverse team to executive compensation. – Source: Restaurant business.

Restaurant employment continued to trend higher in December, but overall staffing levels remained well below pre-pandemic readings . . . .

Most Restaurants Remained Understaffed in December

Restaurant employment continued to trend higher in December, but overall staffing levels remained well below pre-pandemic readings. Eating and drinking places* added a net 42,600 jobs in December on a seasonally-adjusted basis, according to preliminary data from the Bureau of Labor Statistics. This continued a period of relatively modest job growth, compared to the healthy gains posted early in the pandemic recovery. Restaurants added an average of 56,000 jobs during the last 5 months, which was well below the average gains of nearly 200,000 jobs during the first seven months of the year. In total during 2021, eating and drinking places restored nearly 1.7 million jobs to payrolls. While this was easily the largest calendar-year employment increase on record, it still left the industry roughly 650,000 jobs – or 5.3% – below pre-pandemic staffing levels.

Nearly 4 in 5 restaurants are understaffed

Although restaurant job growth slowed in recent months, demand for employees remained high going into December. In a November 2021 survey fielded by the Association, 77% of operators said their restaurant did not have enough employees to support existing customer demand. A strong majority of both full-service operators (80%) and limited-service operators (73%) said their restaurant did not have enough employees to meet customer demand. For most restaurants, staffing was significantly below necessary levels. Among restaurants that were understaffed in November, 75% of operators said their restaurant was more than 10% below necessary staffing levels. Thirty-one percent of understaffed operators were more than 20% below necessary staffing levels. Twenty-eight percent of understaffed full-service operators and 33% of understaffed limited-service operators said their restaurant was more than 20% below necessary staffing levels in November.

Impact of being understaffed

As a result of being understaffed, 65% of operators say their restaurant cut hours of operation on days that it is open for business. Forty-four percent of operators reduced the number of items on their menu, while 44% closed their restaurant on days that it would normally be open. Forty percent of operators say they reduced seating capacity as a result of being understaffed. Full-service operators were more likely than limited-service operators to say they cut back on menu items, closed on days that they would normally be open, and reduced seating capacity.

*Eating and drinking places are the primary component of the total restaurant and foodservice industry, which prior to the coronavirus outbreak employed 12 million out of the total restaurant and foodservice workforce of 15.6 million. Read more analysis and commentary from the Association’s chief economist Bruce Grindy. – Source: The National Restaurant Association.

TGI Fridays off-premises channels mixed 30.6 percent in 2021, up from 9.8 percent in 2019 . . . .

TGI Fridays Develops To-Go Focused ‘Fridays on the Fly’ Concept

COVID’s acceleration of off-premises has pushed several casual-dining brands to rethink development strategies, namely a shift into the quick-service segment. IHOP, Buffalo Wild Wings, Hooters, Friendly’s, P.F. Chang’s, Golden Corral, and others have either rolled out, tested, or considered leveraging smaller formats to meet the new age of convenience.

Now add 690-unit TGI Fridays to the list.

At the ICR Conference on Monday, the self-described “most recognized bar in the world,” unveiled Fridays on the Fly, a 2,500-square-foot delivery and to-go focused concept geared at penetrating markets inside and outside the U.S. “The pandemic has really become an enabler,” said CEO Ray Blanchette. “What always inhibited the growth of smaller footprints was people still want to eat on Friday and Saturday night at 7 o’clock, so if you don’t have the capacity to handle them, it’s hard to get to your average unit volume. The pandemic changed all that. Now that 30 percent of revenue comes away from restaurants, we can actually do both.” TGI Fridays U.S. off-premises mix reached 30.6 percent in 2021, compared to 37.8 percent in 2020 and 9.8 percent prior to the pandemic. Delivery accounted for 17 to 20 percent of sales in 2021, an increase from 5 to 6 percent two years ago. The chain saw $20.4 million in average monthly off-premises sales in 2021, versus $15.7 million in 2020 and $6.5 million in 2019. Forty percent of those sales come from TGI Fridays’ native web and app.  The first Fridays on the Fly is under construction, although Blanchette did not indicate in which market or how many the company planned to open. TGI Fridays estimates each location could earn $2 million in AUV and $300,000 in annualized EBITDA, with a $700,000 investment and payback period of 2.3 years. The brand’s top 25 restaurants generate an average of $1.7 million in off-premises revenue per year, so the strategy will be to look for markets with similar demographics as those performers and grow the Fridays on the Fly concept in these areas. “We know and believe strongly that the demand for off-premise is here to stay,” said President and COO John Neitzel. TGI Fridays finds itself still in the throes of a turnaround effort, which dates back to the hiring of Blanchette in October 2018. About a year later, the chain announced its intentions to go public with special purpose acquisition company Allegro Merger Corp. as part of a $380 million deal. At the time, the restaurant had roughly 840 restaurants, including 396 in the U.S. In Q4 2019, corporate and franchise same-store sales dropped 9.4 percent and 12.8 percent, respectively, and traffic declined by 5.9 percent and 11.4 percent. When COVID hit, sales dropped roughly 80 percent. Because of those challenges, the merger agreement was canceled in April 2020. In 2021, same-store sales rose 2.4 percent against two years ago, but that’s in comparison to a poor 2019, which saw systemwide comps declines of 8.2 percent, 7.9 percent, 7.8 percent, and 11.3 percent. The brand earned $73.2 million in average monthly volume in 2021, up from $50.8 million in 2020 and $72.5 million in 2019. Since the pandemic began, TGI Fridays has permanently shut down close to 150 stores systemwide.

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Is a TGI Fridays Comeback in the Cards?

‘Extraordinary’ Conditions Sink TGI Fridays’ $380M Sale

Challenged by COVID, TGI Fridays Fights its Way Back

During its comeback, TGI Fridays has focused on elevating its digital business. Amid the pandemic, the restaurant upgraded its online ordering platform and saw improvements in conversions, upsells, and average order value. Additionally, the brand has continued to invest in its rewards program, which includes members who visit four times as much and spend 12 percent more than non loyalty guests. “The majority of our invested capital is being spent in the digital arena to continue to maximize and optimize these e-commerce channels, as well as deepening the relationship that we have with our stakeholders, as well as improving some execution both in-restaurant and for our off-premise experience,” said Chief Experience Officer Sara Bittorf. To bolster its digital presence even further, TGI Fridays executed two key virtual restaurant partnerships in 2021. In September, the casual-dining chain signed an agreement with REEF Kitchens to launch 300 ghost kitchens globally in a little more than four years. From this deal, TGI Fridays expects annual royalty between $10 million and $25 million after 2025. The restaurant then announced a joint effort with digital kitchen operator C3 (Creating Culinary Communities) to insert the company’s virtual brands in 170 corporately run stores nationwide. TGI Fridays is currently testing the ghost concept Krispy Rice in 14 California and Maryland/Washington, D.C. locations, and early results show $40 in average check, $4,000 to $10,000 in sales per unit per week, and high consumer acceptance. At these pilot restaurants, Krispy Rice is also available in the dining room and through TGI Fridays web and app platforms. “They have some really sexy, some really cool brands that interestingly enough, we can run these without making them subject to our current bottleneck,” Blanchette said. “And so it truly does expand theoretical capacity.” Fridays on the Fly, which will also offer these virtual concepts, is one of five growth vehicles. The other four are U.S. franchisees, international units, company-run stores, and consumer-packaged goods. There are 154 franchised stores in the U.S. in 25 states, led by franchisees with an average tenure of 15 years. The locations earn $2.7 million in AUV and saw double-digit same-store sales growth in the back half of 2021 against 2019. Meanwhile, there are 157 company-run restaurants in 14 states with an AUV of $3 million. Internationally, TGI Fridays operates 379 stores in 53 countries, and Blanchette believes there’s an opportunity to return to 30 openings per year and more than double the footprint, with much white space in Europe and Asia. Global markets are also responsible for the chain’s growth in consumer-packaged goods. The channel’s compound annual growth rate was 7 percent in recent years but has now increased to 12 percent after the identification of new growth markets, like the U.K., which represents 10 percent of royalty streams after only one year. – Source: fsr.

Checkers is testing AI-powered voice bots in drive-thru lanes . . . .

Checkers & Rally’s is Rolling out Voice-Ordering Bots to Take Drive-thru Orders at 267 Restaurants Amid a Crippling Labor Shortage in the Industry

Drive-thru lanes generate anywhere from 60% to 70% of sales for fast-food chains.

Checkers & Rally’s is deploying voice ordering bots by tablet maker Presto at 267

Outside McDonald’s, the next burger chain betting big on drive-thru innovation is Checkers & Rally’s. The restaurant company, known for its double drive-thru lanes, announced plans Monday to launch voice ordering bots at 267 corporate stores in partnership with Presto. Checkers is now the first national restaurant concept to scale the use of AI-powered voice assistants at the drive-thru, which will be rolled out throughout 2022. The move comes as the industry faces a massive labor shortage. In November, 920,000 employees quit working at restaurants and hotels, surpassing August’s high of 867,000 in the second half of 2021, according to Labor Department data. Checkers said using automated voice bots to take orders at the drive-thru will allow restaurants to redeploy existing workers to “more people-dependent” tasks that enhance the guest experience. “I think there is an incorrect narrative circulating that technology will contribute to job loss or serves as a complete ‘fix’ for the current labor challenges everyone in the restaurant industry is experiencing right now. The case is quite the opposite for us. Because we are able to implement technology, we are growing and hiring at a rapid speed,” CEO Frances Allen told Insider. “Our use of technology is aimed at streamlining work for our team members. It is about making their jobs more doable and enjoyable.” Restaurant software provider Presto is known in the industry for introducing pay-at-the-table tablets in 2011. One of its biggest customers is Applebee’s. In November, it announced plans to go public through a SPAC deal with holding company Ventoux CCM Acquisition Corp. The combined companies are valued at $1 billion. Presto added voice ordering to its suite of front-of-the-house management tools last year “to capture a significant share of the $205 billion restaurant labor productivity market,” the company said. In a previous interview, Presto told Insider that the voice ordering system is nearly 100% accurate and allows restaurants to redeploy labor resources to other tasks. “Checkers & Rally’s desire to take the industry forward through disruptive innovation is inspiring, and Presto is fully committed to supporting this bold vision,”  Rajat Suri, founder and CEO of Presto, said in a statement. Checkers & Rally’s rendering of automated drive-thrus. Checkers, which has 898 restaurants, is not alone in adding new technologies to help streamline daily operations amid a shortage in labor. Last year, New York restaurateur Danny Meyer’s investment firm backed labor-retention tool 7shifts. Applebee’s, Taco Bell, and Chick-fil-A also tapped labor-hiring tool Landed to fill jobs at dozens of restaurants. Others are looking at automation at the drive-thru, an ordering channel that typically generates 60% to 70% of a chain’s total sales. Startup Bite Ninja is using gig workers trained to take fast-food drive-thru orders remotely from anywhere in the US. – Source: Insider.

Bob Evans contemplating a multi-million sale . . . .

Bob Evans Restaurants Is Exploring a $600 Million Sale

Bob Evans Restaurants is exploring a sale that could value the fast-casual dining chain at up to $600 million, according to people with knowledge of the matter. The company and its owner, private equity firm Golden Gate Capital, are working with financial advisers, the people said, asking not to be identified discussing private information.  In the past 12 months, the company had earnings before interest, taxes, depreciation, and amortization of about $65 million, the people said. That implies a valuation of as much as $600 million, as family-dining restaurants are valued at a price-to-Ebitda multiple in the high single digits, they said. No final decision has been made and Golden Gate could opt to keep the business, the people added. A representative for Golden Gate declined to comment, while a representative for Bob Evans didn’t immediately respond to requests for comment. San Francisco-based Golden Gate acquired the restaurant operations from Bob Evans Farms Inc. in 2017 in a $565 million deal, according to a statement at the time. Bob Evans’ refrigerated dinner business remained public before getting acquired by Post Holdings Inc. later that year. The Bob Evans restaurant chain now operates close to 500 locations in 18 states primarily in the Midwest, mid-Atlantic and Southeastern U.S., its website showed. A possible sale of the business comes after many restaurants were upended by Covid-19. Bob Evans, however, garnered some of its best business during the pandemic, Chief Executive Officer Saed Mohseni said in an interview last year with the trade magazine FSR. – Source: Bloomberg L.P./FSR.

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