Bartolotta cooks up kitchen for Kohl’s

October 25, 2016

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Rick Romell
Milwaukee Journal Sentinel
http://www.jsonline.com/story/money/2016/10/20/bartolotta-cooks-up-kitchen-kohls/92418108/

Menomonee Falls — For Bartolotta Restaurant Group, it’s an opportunity to branch further into a promising business area.

For Kohl’s Corp., it’s a shiny amenity to help in the quest to attract and retain good people.

And for Jason Wessels, the new dining area and kitchen his employer unveiled this week — a huge space that combines industrial-chic design with around-the-world food prep stations — is more than acceptable.

“This is amazing,” Wessels, who directs the big retailer’s shopper loyalty program, said as he got his first glimpse of the 32,000-square-foot area at corporate headquarters that Kohl’s has dubbed “The Kitch.”

“Like, amazing….It’s unbelievable.”

Following the lead of companies such as Silicon Valley tech firms that compete ferociously for talent, Kohl’s is wagering on the notion that one way to an employee’s heart is through his — or her — stomach.

“Corporations, particularly financial and high tech, where attracting and retaining high-skilled employees is very important, have seriously upgraded the quality of the meal services that they provide,” said Thomas MacDermott, owner of New Hampshire-based Clarion Group, a food service consultant.

Kohl’s isn’t Google. But for a department store retailer beset by stalled growth, changing consumer preferences and the ever-looming, Godzilla-like threat of Amazon, anything that helps bring in and hold smart employees may well be a smart bet.

“We knew we needed to elevate the quality,” chief administrative officer Richard Schepp said.

So, out with an in-house dining setup Schepp described with faint praise, saying it had been “OK” and “a decent cafeteria experience.”

In with a sleek, contemporary dining hall and such fare as Neapolitan pizzas, freshly prepared sushi, and specialty salads (beet and goat cheese; spelt and roasted squash with maple dressing) from a kitchen run by Bartolotta, which owns several highly regarded and popular restaurants in the area.

Just a little over five years ago, Kohl’s was cooking its own food at its 5,000-employee headquarters and, according to Schepp, not very well.

Now it has signed up with one of Milwaukee’s premier restaurant operators, outfitted a completely new kitchen and built a dining area that offers a wide range of collaborative gathering spaces and private nooks.

It’s a spot away from cubicles and offices that’s meant to be used all day, full of power outlets and USB ports but free of Kohl’s branding and even any references to the company’s “Greatness Agenda.”

“You feel like you left the building,” Schepp said.

Kohl’s won’t say what it spent, but turning a warren of cubicles into a dining area that can seat 750, a kitchen the size of a mini-mansion and a barista bar to boot isn’t cheap.

“This is all brand new,” Bartolotta group co-owner Joe Bartolotta said as he showed off the space. “…We gutted everything. We tore out the ceilings. We tore out everything. It was a very sizable investment.”

Whatever Kohl’s spent, it appears the company can recoup a small part of the expense through an agreement with the state that gives the firm tax credits in exchange for capital investments.

The deal was struck in July 2012, when the company planned to build a new, $250 million corporate campus a few miles from its present location. Kohl’s abandoned the plans 17 months later in favor of a less-expensive expansion at its current site. The $137 million in capital investment the company made there through last year, however, have helped it earn $18.3 million in state tax credits under the agreement.

The corporate impulse to amp up in-house dining isn’t broad, but rather is concentrated in sectors such as tech, said Mike Buzalka, executive features editor of trade journal Food Management.

But he said upgrades make sense for companies that, like Kohl’s, are situated where there are few nearby dining options.

It’s unusual for a firm to hire a restaurant operator, rather than a food-service contractor, to run its kitchen, Buzalka said.

Joe Bartolotta, however, sees the venture as a way to diversify. His 1,000-employee company has 11 restaurants, including highly regarded spots such as Lake Park Bistro and Bacchus.

But opening stand-alone restaurants is costly, and Bartolotta has been looking increasingly at opportunities to run places without the big capital investment. The firm operates four restaurants at Wauwatosa’s Mayfair Collection, for example, that are owned by the shopping center’s developer.

Two years ago, Bartolotta took over the food court at the U.S. Bank Center and opened what it calls the Downtown Kitchen. That operation impressed Kohl’s executives and paved the way for creation of The Kitch.

Profit margins on such businesses are lower than at a typical Bartolotta restaurant, but with a minimal upfront investment and an all-but-captive market of 5,000 potential diners, it’s an attractive proposition, Joe Bartolotta said.

That thinking makes sense, suggested Darren Tristano, president of Chicago-based food industry research firm Technomic Inc.

“When we look at the full-service space where Bartolotta operates, the high end is doing OK, but there aren’t a lot of growth opportunities for new restaurants,” Tristano said.

John Wise, operations director and managing partner at Bartolotta, said Downtown Kitchen serves about 500 people for breakfast and 1,500 to 2,000 at lunch. He expects the numbers at Kohl’s to be bigger.

Wessels, meanwhile, expects the new space to be about more than food. He believes it will bring colleagues together and spur beneficial collaboration.

Many people, Wessels said, regard the kitchen as the heart of their home.

“This is really going to become the heart of our office,” he said.


Yum! Brands keeping headquarters in Louisville, moving executives to Texas

March 1, 2016

Caitlin Bowling
INsider Louisville
February 24, 2016
http://insiderlouisville.com/business/yum-headquarters-louisville-moving-heads/

With Yum! Brands Inc. relocating five key C-suite executives to Plano, Texas, Louisville may become a show headquarters for the restaurant conglomerate, while employees in Texas are the ones actually steering the ship.

Yum Brands Inc. is headquartered at 1900 Colonel Sanders Lane. | Courtesy of Yum! Brands

Yum Brands Inc. is headquartered at 1900 Colonel Sanders Lane. | Courtesy of Yum! Brands

“Whenever you move your C-level team … in effect you are moving your headquarters because that is where your heads are,” said Darren Tristano, president at Technomic, a Chicago-based restaurant industry research firm.

Business First previously reported that Yum CEO Greg Creed, chief public affairs and global nutrition officer Jonathan Blum, chief legal officer Marc Kesselman, chief people officer Tracy Skeans, and a yet-to-be-named CFO will move to Plano, where Yum’s global operations team and its subsidiary Pizza Hut are located.

Yum’s former CFO Pat Grismer resigned effective Feb. 19, Insider Louisville previously reported.

The company is adamant that Louisville is and will remain Yum’s home. Virginia Ferguson, a spokeswoman for Yum, told IL that none of its nearly 1,000 Yum and KFC U.S. employees are moving to Texas.

“We are proud to be here,” Ferguson said.

IL was scheduled to interview Blum this afternoon about the impending move; however, a few minutes before the appointment, IL was told he was suddenly pulled away and would be unavailable for comment. Ferguson forwarded along statements from Yum explaining the decision.

Creed and the other four executives “will be highly mobile, traveling to many of our international markets and offices throughout the year, including Louisville for 1-2 weeks each month,” Ferguson said in an emailed statement. “Given the global nature of our business, which has transformed over the years, the YUM executive team’s office will be in Plano, but they will retain an office in Louisville.”

She also noted that Yum has based its international operations in Texas since 1997, when the company spun-off from PepsiCo.

It makes sense that the company’s leaders would want to be close to its overseas operations, Tristano said. “Today, a lot of the growth restaurant companies are seeing takes place outside our borders.”

Texas also is home to a number of other restaurant chains and restaurant-related businesses, including Pie Five Pizza, Dickey’s Barbecue Pit, Romano’s Macaroni Grill and Apex Restaurant Group.

“Dallas is considered a very big restaurant town,” Tristano said, noting that many industry events and restaurant innovation happens there. It also is warm, has a large population and is somewhat centrally located.

While Louisville city leaders often tout the city’s location and its proximity to other places, the truth is one of the few ways to get a direct flight is to be a box the United Parcel Service is shipping.

The Louisville International Airport has fewer than 20 nonstop flights to cities in the United States. The Dallas/Fort Worth International Airport is a major transportation hub; it has nearly 50 nonstop flights to international cities and countless more within the continental United States.

“There is no way to overlook that,” said Nat Irvin, the Strickler executive in residence and professor of management at the University of Louisville College of Business. “We can get to the airport in 20 minutes from any place in the city, but part of the downside is you can’t get to any place directly.”

And Dallas is closer to China — where Yum will spin-off its operations this year — offering a nonstop flight to Beijing. Although Yum China will technically operate as its own company, Yum leaders will no doubt be keeping a close eye on how the company is faring in China’s sometimes volatile market.

Already, Yum executives spend a good portion of their year abroad, according to the company.

“I think what (the move) represents is the importance of face-to-face communications when you are developing strategy,” Irvin said. “You like to see them; you like to hear them; you like to be close to them.”

The only factor in Yum’s decision, according to Ferguson, was the fact that the company’s global operations offices are in Texas

“Our business is a global business, and it makes sense,” she said.

Tristano said he wouldn’t be surprised if Yum moved more jobs to Texas in the future, but the company also has good reason to remain in Louisville. If the company said it planned to move its headquarters but keep jobs in Louisville, it could end up with a retention problem.

“It would make sense for them to continue to have that (Louisville) location regardless of what they call it,” he said. “This is a less disruptive strategy for them.”

With its name plastered around the city (see KFC Yum! Center), Irvin said he is confident Yum will continue to maintain a large presence in Louisville.

“I think Yum is fully ensconced in this community. The company has a very broad footprint in this community, and I think the heart still remains right there,” Irvin said. “I think what they have made is a decision for the company. I don’t think it’s a detriment to the community — a good idea for them, not necessarily a bad idea for us.”

Still, the decision by Yum is an unusual one.

Tristano could not think of any comparable examples, except possibly Tim Horton’s and Burger King. However, the quandary over where to headquarter those two restaurant chains is the result of their merger back in 2014. As of now, Tim Horton’s base of operations remains in Canada, while Burger King resides in the United States.

Overall, Tristano said he thinks Yum is making good decisions to focus more globally and try to appeal to younger generations.

“They seem to be moving in the right direction strategically.”


Cage-free eggs could boost Bloomin’ Brands’ bottom line

February 29, 2016

Ashley Gurbal Kritzer
Tampa Bay Business Journal
Feb 23, 2016
http://www.bizjournals.com/tampabay/blog/morning-edition/2016/02/cagefree-eggs-could-boost-bloomin-brands-bottom.html

Don’t count the cage-free eggs before they’re hatched, but Bloomin’ Brands Inc.’s latest supplier decision could boost its bottom line.outback-ft-myers-evening-750xx1800-1013-0-104

Tampa-based Bloomin’ (NASDAQ: BLMN) said Monday that it will transition to 100 percent cage-free eggs in its restaurants by 2025. Bloomin’ is the parent company of Outback Steakhouse, Carrabba’s Italian Grill, Bonefish Grill and Fleming’s Prime Steakhouse and Wine Bar.

“Our guests expect us to source and purchase wholesome ingredients responsibly,” Juan Guerrero, chief global supply chain officer, said in a statement. “We are working with our suppliers to ensure we meet or exceed this deadline.”

Committing to cage-free eggs is a popular move in the restaurant industry. In September, McDonald’s Corp. (NYSE: MCD) said it would shift to cage-free eggs, as is Dunkin’ Donuts (NASDAQ: DNKN) and Taco Bell, which is owned by Yum! Brands Inc. (NYSE: YUM).

Bloomin’ operates close to 1,500 restaurants throughout 48 states, Puerto Rico, Guam and 22 countries.

The cage-free move, Bloomin’ said, “reaffirms the company’s commitment to the humane treatment and handling of animals” — and that’s important to consumers, according to Technomic Inc., a Chicago-based food industry research and consulting firm.

“Cage-free is particularly important right now,” Darren Tristano, Technomic president, wrote in a Feb. 2 blog post. “Forty seven percent of consumers said they are more likely to order dishes made from cage-free eggs or poultry during breakfast dine-out occasions.”

“The preference ties into health and wellness concerns from consumers,” Tristano said.

“Consumers are increasingly concerned about transparency — what’s in their food and where it came from,” he wrote, “and operators and suppliers are feeling the heat.”


Cracker Barrel Old Country Store® Wins Chain Restaurant Consumers’ Choice Award

January 27, 2016

Nick Flanagan, a senior vice president for restaurant and retail for Cracker Barrel Old Country Stores®, accepts award from Technomic President Darren Tristano. Cracker Barrel was named a Chain Restaurants Consumers' Choice Award winner for 2016. (Photo: Business Wire)LEBANON, Tenn.–(BUSINESS WIRE)–Cracker Barrel Old Country Store® was named Chain Restaurant Consumers’ Choice Awards winner in the full service restaurant category for the value it provides through excellent service, marking the restaurant company’s third win since 2013.

Conducted by Technomic Inc., a leading food industry research company, its fourth annual Chain Restaurant Consumers’ Choice Awards identifies the top chain restaurants by asking nearly 100,000 consumers to rate over 120 leading restaurant chains on 60 different attributes ranging from the quality of food to the overall brand reputation. Cracker Barrel was given top marks on its ability to provide value through high-quality service, according to consumers.

“Consumers give Cracker Barrel credit for its friendly and polite servers,” said Technomic Inc. President Darren Tristano. “When we asked why they gave high ratings for their visit, many of our respondents talked about how they always make people feel at home.”

“Cracker Barrel’s commitment to excellence is driven by our mission of Pleasing People,” said Cracker Barrel Senior Vice President of Restaurant and Retail Operations Nick Flanagan, who accepted the award at Technomic’s Consumer Insights Planning Program Conference in Newport Beach, California on Thursday, Jan. 14.

“We promise guests a friendly, home-away-from-home, where they can relax, enjoy real home-style food and be cared for like family,” he continued. “Since 2013, Cracker Barrel has been voted the top full service restaurant in the Consumers’ Choice Awards’ ‘Pleasant, Friendly Service,’ ‘Food and Beverage,’ and ‘Value Through Service’ categories, which is a testament to our 72,000 employees who bring our mission to life every day.”

About Technomic

Only Technomic, A Winsight Company, delivers a 360-degree view of the food industry. We impact growth and profitability for our clients by providing consumer-grounded vision and channel-relevant strategic insights. Our services range from major research studies and management consulting solutions to online databases and simple fact-finding assignments. Our clients include food manufacturers and distributors, restaurants and retailers, other foodservice organizations, and various institutions aligned with the food industry. Visit us atwww.technomic.com.

About Cracker Barrel Old Country Store, Inc.

Cracker Barrel Old Country Store, Inc. provides a friendly home-away-from-home in its old country stores and restaurants. Guests are cared for like family while relaxing and enjoying real home-style food and shopping that’s surprisingly unique, genuinely fun and reminiscent of America’s country heritage…all at a fair price. Cracker Barrel Old Country Store, Inc. (NASDAQ: CBRL) was established in 1969 in Lebanon, Tenn. and operates 635 company-owned locations in 42 states. Nation’s Restaurant News’ 2015 Consumer Picks survey named Cracker Barrel Old Country Store® the winner in two Family-Dining Restaurants categories – Menu Variety and Atmosphere. For more information about the company, visit crackerbarrel.com.


Snacking and Healthier Options are on the Rise

October 30, 2015

pictureSnacking is a growing trend and consumers are snacking more frequently. About half of today’s consumers (51 percent) say they eat snacks at least twice a day and 31 percent say they’re snacking more frequently than they were two years ago.

According to Technomic, Americans also are broadening their definition of a snack to encompass a wider range of foods and beverages.

Smoothies are they a snack or a meal? According to Vitamix and ORC International, 59 percent is snack, 25 percent is part of a meal and 18 percent meal.

“Snacking occasions represent a growth channel for restaurant operators. The retail market is aggressively promoting snacks, but there’s plenty of room for restaurants to expand their snack programs and grab share. By providing more innovative, healthy and easily portable snacks, and boosting variety, restaurants can position themselves to increase incremental traffic and sales –particularly among a younger customer base.” Darren Tristano, executive vice president of Technomic.

In an article by WholeFoods Magazine called “Healthy Snacking on the Rise in the US” this article reports that more Americans are snacking more than ever before – but are also make smarter snacking choices. In a recent survey taken, 33% of the survey population is snacking on healthier foods than they were last year. This number has steadily risen with time, and is something that only stands to increase with nearly a third of all parents surveyed mentioning that they are serving healthier snacks to their children.

What a great opportunity for any restaurant, café, juice or smoothie bar to take advantage of this growing trend. Now more than ever it is important to offer customers what they want and that is healthier options.

The healthy trend is also dominating menus. Gone are the days of serving only indulgent foods or offering calorie laden menu items. The most prominent industry buzzword over that last decade is healthy which appears in various forms on today’s menus. This change has been inspired by the growing public awareness of healthy attributes in food and consumers are leaning on restaurants to go beyond adding a side salad to create a healthy meal.


Gone Fishing

July 27, 2015

July15-Food-Trends---Sharky's-Tacos

Copyright © 2015 Journalistic Inc.

http://www.qsrmagazine.com/menu-innovations/gone-fishin?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A%20QSRmagazine%20%28QSR%20magazine%29

Seafood gives operators a versatile protein that has a sustainable, healthful halo.

There’s nothing fishy about the seafood at limited-service restaurants today. Operators are focused on meeting consumers’ demands for seafood that is creative, healthful, and sustainable, from grilled fish fillets to upscale lobster rolls.

“There’s a little oversaturation in chicken, burgers, and pizza,” says Andrew Gruel, founder of Slapfish, a seven-unit southern California seafood chain. “People are eating more seafood now that they realize how healthy and accessible it is.”

According to Chicago-based market research firm Technomic Inc., 64 percent of the nation’s quick-service and fast-casual restaurants offer a seafood item, whether it’s fish tacos, shrimp fried rice, or anchovies on pizza. The number of seafood items on regular limited-service menus is virtually unchanged from a year ago, with 54 percent featured at quick serves and 46 percent at fast casuals.

The most offered seafood, according to Technomic’s MenuMonitor database, is shrimp. It’s in a variety of dishes, part of many ethnic menus, and a popular add-on protein at restaurants as diverse as Noodles & Co. and Pei Wei Asian Diner.
Even Atlanta-based wings chain Wing Zone serves a shrimp dish. “Almost all of our food items are fried, so having fried shrimp is easy on the operation,” says Dan Corrigan, director of marketing. “We actually changed our shrimp recently to more of a jumbo breaded shrimp, and that’s doing well.” The shrimp is served with a dipping sauce. It’s only 3 percent of the sales, Corrigan adds, but when Wing Zone tested removing the item from one restaurant, guests wanted it back.
One reason fast casuals make up a big percentage of limited-service eateries serving seafood is its premium price, says Technomic executive vice president Darren Tristano.

“That’s harder to translate to quick service,” he says. “Seafood’s price points are more full service or fast casual.” Nonetheless, many big limited-service restaurant operators offer at least one seafood menu item, such as the Filet-O-Fish at McDonald’s or Tuna Sandwich at Subway.

Keeping seafood sustainable is more important to Americans today than ever before.

“Customers are increasingly asking where their food comes from, how is it produced, is it safe, and are there any environmental issues when it’s produced,” says James Baros, aquaculture and sustainability coordinator at provider National Fish and Seafood of Glouchester, Massachusetts. He points to Atlantic cod and some tuna species as examples of how industrial fishing nearly obliterated stocks. “It was an important lesson to learn,” he says.

Half of U.S. seafood is caught wild, while the other half is farmed. That’s up from 15 percent farmed three decades ago. “We’re seeing a big transition to aquaculture,” Baros says. “Fish is the last major food we go out and catch. You don’t hear of catching cows in the wild.”

Salmon, shrimp, and tilapia are the most popular farm-raised seafood varieties for Americans. But wild caught still has a certain cachet for diners, and many restaurants point out that their fish is wild caught. That includes the largest quick-service seafood operator, Long John Silver’s, where the classic battered and fried Fish and Chips remains the biggest seller.

“Our two main types of fish are Alaskan pollock and cod. Both are wild caught and sustainable,” says chief executive James O’Reilly. “It takes a lot of commitment to maintain a sustainable supply.”

The fried fish is usually pollock, while cod is available either fried or baked. Shrimp, mostly farm-raised in South America, can be baked or fried, and Long John Silver’s also sells fried crab cakes and clams, with langoustine bites offered as a seasonal item.

“Our seafood menu has evolved,” O’Reilly says, adding that the brand has increased its healthier options while also adding more portable items, including fish tacos, seafood-salad sandwiches, and fish strips. These steps are helping the Louisville, Kentucky–based company maintain its seafood leadership, O’Reilly says. “I believe that growth will be fueled by the addition of Millennials concerned with quality and sustainability,” he says.

Battered fried fish is also the No. 1 item at Captain D’s, which has positioned itself as a fast-casual seafood dining experience. While about two-thirds of the menu is fried, the biggest growth is in grilled items, says Jason Henderson, vice president of product innovation for the Nashville, Tennessee–based chain. Double-digit growth pushed grilled food to about 10 percent of sales in 2014.

The grilled menu includes Alaska salmon and pollock, tilapia, and shrimp, while the fried fish is pollock. The chain also features breaded flounder and catfish, a nod to its Southern roots, as well as fried shrimp and stuffed crab shells.
Most diners don’t ask about the food’s source, Henderson says, but the menu often makes it quite clear, particularly with Alaskan fish.

“We’ve worked with a long list of accounts to increase the visibility of Alaska seafood,” says Claudia Hogue, foodservice director at the Alaska Seafood Marketing Institute. The state produces 53 percent of America’s seafood harvest.

In addition to white fish—cod, halibut, and pollock—Alaska is known for its wild salmon. Some salmon varieties are available year-round, but for most, the season kicked off in May and runs through the summer. There are also Alaska Dungeness and other crab varieties, along with scallops and prawns.

“We encourage people to use the Alaska name because we know customers more and more want to know the origin of their fish,” Hogue says. Studies commissioned by the institute indicate consumers feel better about buying Alaska-brand seafood.

Southern California–based Sharky’s Woodfired Mexican Grill makes a point that fish served in its tacos, burritos, bowls, and other items are wild caught, and varieties like salmon and cod are from Alaska.

“We’re a lifestyle brand, and many who visit us recognize the benefits of wild-caught seafood,” says David Goldstein, chief operating officer of the two-dozen-unit chain.

The most popular seafood item is Charbroiled Fish Tacos featuring salmon or wahoo. Fish tacos are $4.29, versus $2.99 for chicken and $3.99 for steak. Other favorites are the Salmon Power Plate, Salmon Burrito, and Tempura Cod Tacos.
Sharky’s also features mahi mahi, pollock, and shrimp, and all these offerings provide “a real point of differentiation for us,” Goldstein says. Seafood has grown to 11 percent of sales, twice what it was a few years ago.

At Ivar’s Seafood Bars in and around Seattle, fish (Alaska cod) and chips is the big draw. “We ride the up-and-down tides on price points,” says Carl Taylor, director of operations at the regional favorite. “It’s a premium product we serve.”

The majority of the menu is fried. In addition to cod, there’s fried halibut, salmon, clams, scallops, big and small prawns, and oysters. The menu also has several chowders, grilled halibut and salmon, Dungeness crab, and salads with different seafood varieties.

“Within the past three years, we expanded the grilled items and added fresh fish,” Taylor says. “We sell it as long as the run is going.” The two-piece Fresh Halibut Platter, with cole slaw, wild rice, and cornbread, sells for $15.99.

Ivar’s oysters are from the Washington and Oregon coasts. The Alaska Dungeness ($9.29) is higher in terms of price, he says, but worth every penny. “I could go out and get rock crab and mix it with the Dungeness to lower the price, but we don’t.”

Just as consumers equate wild salmon with Alaska, they link lobsters with Maine. That’s the draw at New York–based Luke’s Lobster, which has 17 fast-casual “shacks” in Mid-Atlantic coast cities and recently expanded to Chicago.

“We are exporting the experience of the Maine lobster shack,” says founder and president Luke Holden, whose father has been in the seafood industry for years and built up well-established relationships with fishermen across the Northeast coast.
The $15 fresh lobster rolls are made to order in the traditional Maine style, with a quarter pound of chilled lobster meat in a top-split bun—the sides are shaved to toast better—plus a slick of mayonnaise, Holden’s secret seasoning, and lemon butter.

“All the meat is from the claws and the knuckles; the knuckle tends to be the most delicious part,” Holden says, adding that the tail is considered premium, but not for lobster rolls. “You would have a tug of war with a warm bun and a chewy tail.”

The shacks also offer crab and shrimp rolls, Jonah crab claws, and New England clam chowder. Crab is purchased from fishermen from Maine to Rhode Island, while the shrimp is wild from Canada.

Lobsters were sustainably caught long before it became a trend, says Matt Jacobson, executive director of the Maine Lobster Marketing Collaborative. Some rules governing trapping date from the 1870s. Today, lobsters must be males between 3.5 and 5 inches in body length. Others are tossed back—smaller ones to grow, and females and bigger males to breed.

While many consumers consider lobsters a center-of-plate item served whole, there are many other uses for the meat, Jacobson says, including in salads, pasta, and Asian dishes. Lobster rolls are also growing in popularity nationwide.

Lobster rolls and fish tacos are the two top sellers at Slapfish. “Lobster is incredibly indulgent, and the growth in our lobster rolls has been 100 percent due to Instagram and social media,” Gruel says. “People see them online and want them.”

The fish tacos are available with grilled or fried fish, largely wild-caught species ranging from Pacific cod to Maine’s Acadian redfish, depending on the season. The tacos include cabbage, avocado purée, and pickled onions.

“The key is the balance,” he says. “You want a good amount of cabbage to provide that great crunch, and the acidity to cut through the richness of the fish.”

Slapfish’s limited entrée menu also includes the Crabster Grilled Cheese sandwich with lobster and crab, and a Surf ‘n Turf Lobster Burger smothered in lobster and caramelized onions. There’s also fish and chips, chowder, chowder on fries, and shrimp.

A taste of the Hawaiian Islands is part of the draw at Coconut’s Fish Café. The four-unit chain began in Maui, Hawaii, and has since moved to the mainland. It features mahi mahi, ono—the Hawaiian name for wahoo—and ahi.

“They are all wild, and they are line caught,” says Dan Oney, chief operating officer. “The people we buy from are able to track the fish to the boat. It’s the concept of taking care of the earth and taking care of our customers.”

Most of the fish is grilled, and the ahi tuna is seared rare and served with wasabi. “We have big, beautiful, 6-ounce fillets of fish that if you go to a sit-down restaurant, you would pay $30 or $40,” Oney says. Coconut’s platters start at $10.99.
Mahi mahi and ono are in the seafood pasta, as well as the fish tacos that include family-recipe coleslaw and tomato and mango salsas. There’s also a fish sandwich and other fried items—fish and chips, shrimp, calamari, and coconut shrimp—on the menu.


Americans Turning to Restaurants, Not Grocery Stores, for Mealtime

April 30, 2015

by Mark Fisher

http://www.daytondailynews.com/news/news/americans-turning-to-restaurants-not-grocery-store/nkxP2/picture

Restaurants cater to younger diners who are leading the trend
The Census Bureau reports that in March, for the first time since such records have been kept, Americans spent more money in restaurants than in grocery stores. Millennials led the charge. Local restaurant owners, including Dan Young owner of Young’s Jersey Dairy, say they’re not surprised about shift occurring in the dining scene in this region and across the country.

For the first time since the government started keeping track in 1992, Americans—led by those in the millennial generation—spent more money last month in restaurants and bars than they did in grocery stores.

This region’s restaurant owners say they’re not surprised at the shift in spending patterns, and they’re taking steps to attract younger diners.

Dan Young, CEO of Young’s Jersey Dairy and the Golden Jersey Inn in Clark County north of Yellow Springs, said today’s families work long and sometimes unpredictable hours and have limited time to spend together.

“Yes, they can get a nice meal from the grocery store, but if your ‘together’ time is limited, who wants to spend that time preparing the meal?” Young said. “Why not meet your family or friends at a local restaurant and enjoy each other’s company while choosing from a much wider selection of food than you typically would at home?”

The U.S. Department of Commerce reported last week that Americans spent $52.3 billion at restaurants and bars in March, and $49.7 billion in grocery stores—the first time grocery spending lagged restaurant/bar expenditures.

The National Restaurant Association reported earlier this month that despite extreme weather in many parts of the country, its “Restaurant Performance Index” (RPI)—a monthly barometer of the the health of and outlook for the U.S. restaurant industry—held steady in February, which also marked the 24th consecutive month in which the RPI signified improvement in key industry indicators.

Hudson Riehle, senior vice president for the restaurant association, said restaurant operators are increasingly optimistic about business conditions and potential sales growth in the months ahead. About 59 percent of restaurant operators expect to have higher sales in six months, compared to the same period in the previous year, up from 57 percent the previous month. In contrast, only 4 percent of restaurant operators expect their sales volume in six months to be lower than it was during the same period in the previous year, restaurant association officials said.

The association offers advice to restaurant managers on its web site on how to cater to the twenty-somethings and early-thirty-somethings who are increasingly likely to let others prepare their meals.

“Millennials view dining out as a social event (i.e. a chance to connect),” the association says on its web site. “They prefer to eat at restaurants with a lot of choices and lower price points. They tend to favor fast food, deli food and pizza restaurants over coffee shops, high-end dining and casual dining.

“Equally important for restaurateurs to remember is that millennials can be moving targets. While they develop brand attractions and support reward and loyalty programs, their allegiances can be very flexible according to their circumstances.”

Young, whose restaurant and ice cream shop are geared toward families, said diners in the 25-to-34 age group are “eager to try new tastes, probably because they have been exposed to more variety growing up.”

“Plus, with today’s amazing technology, it just takes a few tweets or texts and you can be visiting a nice restaurant with family and friends in a few minutes,” Young said. “Spontaneous is so much easier than when most of the 25-to-34-year-olds were born —when the family had one, maybe two phones at home, and families had to plan out the day ahead of time.”

Shanon Morgan, president of the Miami Valley Restaurant Association, agreed that technology — and in particular, social media — are stimulating restaurant and bar business, especially among younger diners.

“It’s much cooler to check in at the local tap room than the local grocery store,” Morgan said.

Jay’s Restaurant in Dayton’s Oregon Historic District has begun advertising more heavily on social-media sites and has launched “happy hour” specials on Tuesday and Wednesday in part to attract more younger diners, according to Amy Haverstick, Jay’s Restaurant’s owner, who is herself the mother of a 2-year-old.

“People my age, the couples are working full time, and they’re finding the easy way out — it’s all about convenience,” Haverstick said. “Life just seems to be a lot more fast-paced for our generation.”

Darren Tristano—executive vice president of Technomic, a Chicago-based food service research and consulting firm—said his company’s research “continues to show that the millennial consumer has integrated dining away from home deeper into its identity compared to older generations. They appreciate the socialization and the lifestyle element that restaurant visits bring to their overall quality of life.”

Tristano said members of the millennial generation “continue to use restaurants with great frequency, and as their spending power builds, so will their dining (expenditures). Favorable employment and disposable income growth trends along with lower gas prices are fueling the return by many younger consumers to restaurants.”

Millennials, Tristano said, “are the future, and along with them, the key to many restaurants’ future.”
________________________________________
Americans’ shifting spending patterns
March 2015
Restaurants and bars: $50.4 billion
Grocery stores: $50.1 billion
February 2015
Restaurants and bars: $50.0 billion
Grocery stores: $50.4 billion
March 2014
Restaurants and bars: $46.8 billion
Grocery stores: $49.1 billion
Source: U.S. Department of Commerce


10 INTERNATIONAL CONCEPTS FINDING SUCCESS IN THE U.S.

June 2, 2014

Darren Tristano and Lauren Hallow

Some of the United States’ largest restaurant chains, including McDonald’s, Starbucks and Applebee’s, conduct a significant amount of business overseas. So what are some of the larger international chains that are enjoying success in the U.S.?

Several global chains are capitalizing on U.S. consumers’ appreciation for authenticity by bringing international fare, such as TOUS les JOURS Korean pastries and 100 Montaditos Spanish sandwiches, to the States. However, these concepts aren’t just offering a taste of their native countries—chains like Maoz Vegetarian and Coffee Culture Café & Eatery offer a different spin on concepts (health-focused eateries and coffee cafés, respectively) already popular in the U.S. Below are ten international chains that have successfully entered the U.S. and are looking to expand stateside:

Pie Face

Pie Face interior

Who: Founded in Sydney in 2003, Pie Face is an Australian limited-service chain known for its savory pies marked with cartoonish faces. The fun concept also offers a range of sandwiches, wraps, pastries and coffee. In 2012, Pie Face opened its first location outside of Australia in New York City.

U.S. Development: Shortly after Pie Face opened its first site, Wynn Resorts Ltd. CEO Steve Wynn invested $15 million into expanding the concept in the U.S., leading Pie Face to launch seven additional units in New York City over the next two years. From 2012 to 2013, Pie Face’s U.S. sales jumped 150% to $5.5 million.

Why it’s worth watching: Pie Face has flourished in New York City thanks to its sweet and savory handhelds and 24-hour service. The concept is an ideal spot for on-the-go urban consumers looking for everything from a sweet breakfast to a convenient lunch to a late-night snack.

Nando’sNando's exterior-1

 

Nando’s is a fast-casual chicken chain specializing in Portuguese-style peri peri chicken. Since launching in 1987 in South Africa, Nando’s has expanded to more than 1,000 locations in about two-dozen countries, but it’s especially popular in the U.K. The concept first expanded to the U.S. in 2008 with a unit in Washington, DC.

U.S. Development: Nando’s continued expanding in the Washington, DC, market and now operates 15 units in DC, Virginia and Maryland. From 2012 to 2013, Nando’s opened five locations in the U.S., propelling a nearly 40% increase in U.S. sales to $21.4 million. The chain plans to launch its 16th U.S. location soon in the District’s Tenleytown area.

Why it’s worth watching: Nando’s offers patrons a worldly experience, with Portuguese-style chicken and a mix of Portugal and South African wines served in units decorated with African artwork. The chain also showcases the best qualities of a fast-casual concept—lavish decorations make for an inviting place to dine, while speedy service attracts on-the-go patrons.

Giraffas

Giraffas exterior

Since launching in 1981, Giraffas has become one of the most popular limited-service chains in Brazil with its traditional Brazilian plates along with build-your-own burgers. There, the concept is quick-service, but when it expanded to the U.S. in 2011 with a location in Miami, Giraffas adopted a fast-casual service style and added more American-friendly menu items like pastas and salads.

U.S. Development: Giraffas now operates 10 units in the U.S., all in Florida. From 2012 to 2013, the chain launched five Florida units, helping its U.S. sales to triple to $11.1 million. Giraffas recently sold its U.S. company-owned locations to franchisees to raise funds for additional U.S. expansion. The chain aims to operate 200 U.S. locations by 2020.

Why it’s worth watching: Giraffas successfully mixes authentic Brazilian fare with American-style options. Units offer a different take on the American create-your-own-burger concept with Brazilian picanha steak burgers instead of traditional beef patties.

100 Montaditos

100 Montaditos interior

Inspired by traditional Spanish tapas taverns, 100 Montaditos was founded in Spain in 2000. The chain, whose name translates to “100 Sandwiches,” menus at least 100 varieties of crunchy snack-sized rolls made to order and topped with traditional Spanish ingredients like Serrano ham, chorizo and Manchego cheese. Over the years, 100 Montaditos expanded throughout Spain as well as internationally. In 2011, the chain launched its first U.S. location in Miami.

U.S. Development: Since 2011, 100 Montaditos opened about a dozen more Florida sites as well as launched locations in Iowa, New York and the Washington, DC, market. From 2012 to 2013, the chain more than doubled both its U.S. unit count and sales. 100 Montaditos plans to continue expanding in the U.S., recently announcing plans to launch 28 units in New York City over the next three years, five of them before the end of 2014. 100 Montaditos also has additional Florida and Washington, DC-area locations in the pipeline and is seeking sites in new markets such as Texas.

Why it’s worth watching: With its variety of options, along with an adult beverage menu that includes sangria and Spanish wines, 100 Montaditos offers patrons a chance to experience a traditional Spanish experience in a fun, casual setting. The menu includes something for everyone with sandwiches ranging from traditional Spanish options, like Serrano ham, to American-style choices, like Philly steak, to dessert montaditos, such as hazelnut spread on chocolate bread.

WagamamaWagamama-1

 

Although it hails from the U.K., Wagamama takes its inspiration from traditional Japanese ramen bars. The casual-dining Asian/noodle chain offers made-to-order ramen and modern Asian fare in a hip, casual setting. In 2007, Wagamama crossed the pond and launched its first U.S. unit in Boston’s Faneuil Hall.

U.S. Development: Thanks to the popularity of its first U.S. location, Wagamama opened its second U.S. site later that year in Harvard Square in Cambridge, MA. A third location opened in 2009 in Boston’s Prudential Tower. In fall 2013, Wagamama opened its fourth U.S. site—and most suburban location—in Lynnfield, MA. From 2012 to 2013, sales at Wagamama’s U.S. units increased 17.8% to $7.6 million. The chain plans to continue growing in the U.S., with more locations expected to open in the coming years.

Why it’s worth watching: With its large portions of piping-hot ramen along with open kitchens that allow patrons to view their meals being prepared, Wagamama offers customers a taste of the authentic Japanese ramen experience. The contemporary concept is also popular for Millennial-friendly features like fresh juices and complimentary Wi-Fi service at all units.

Hakkasan

Hakkasan Las Vegas

Another U.K.-based concept, Hakkasan actually comes from the same people who founded Wagamama. The fine-dining chain serves upscale modern Cantonese fare in large, opulently decorated units. Since launching in London in 2001, the concept has expanded to several major international cities; it opened its first U.S. location in Miami in 2009.

U.S. Development: Hakkasan now operates five units in the U.S., including a location in New York City that holds one Michelin star. In 2013, the concept launched two U.S. units—one in Beverly Hills, CA, and a 60,000-square-foot restaurant and nightclub in Las Vegas’ MGM Grand Hotel & Casino. In January of this year, parent Hakkasan Ltd. acquired in a majority stake in San Diego-based Enlightened Hospitality Group, whose portfolio includes acclaimed concepts Searsucker, which offers new American fare, and Herringbone, which specializes in seafood. The company plans to continue expanding Hakkasan and Enlightened’s brands in the U.S.

Why it’s worth watching: Although the other Asian chains featured in this blog are more casual, Hakkasan proves that Americans are also seeking upscale Asian fare. While all U.S. sites feature a full-service bar and lounge, Hakkasan’s latest U.S. location in Las Vegas was the first to incorporate a nightclub, suggesting the chain could delve more into the nightclub business in the future.

Coffee Culture Café & Eatery

Coffee Culture

Coffee Culture Café & Eatery is a Canadian quick-service coffee chain. Although grab-and-go options are available, the concept leans toward a more relaxing coffee experience—units are designed to be cozy and inviting, with plush furniture, exposed brick walls, plasma TVs and free Wi-Fi. In 2009, the chain began expanding into the U.S., establishing a U.S. headquarters in Buffalo, NY, for affiliate Coffee Culture New York Inc. and opening units in Williamsville and Ellicottville, NY.

U.S. Development: Over the years, Coffee Culture has continued expanding in New York and has also opened units in new U.S. markets. The chain now operates 13 U.S. locations in New York, Pennsylvania and Florida. Several sites opened in Erie, PA, thanks to a 2010 franchise agreement with Lake Erie College of Osteopathic Medicine. From 2012 to 2013, sales at Coffee Culture’s U.S. locations increased 28.3% to $5.9 million. At least two more U.S. units are in the pipeline for Amherst, NY, and Miami.

Why it’s worth watching: Coffee Culture differentiates itself from other coffee-café chains by offering patrons a welcoming, unpretentious place to relax, study or work while enjoying an all-day menu of specialty coffee drinks, sandwiches and pastries. Unlike other coffee chains, Coffee Culture serves breakfast fare like bagels and egg sandwiches all day, and also menus a variety of sandwiches, wraps and salads for lunch and dinner.

Maoz Vegetarian

Maoz salad bar

As its name suggests, Maoz Vegetarian specializes in vegetarian fare with a menu that centers on sandwiches, salads and gluten-free falafel. The Amsterdam-based quick-service concept gained popularity for its simple service style—patrons choose a salad or sandwich for a fixed price, then visit the salad bar to add as many toppings as they choose for no additional cost. In 2004, Maoz launched its first U.S. location in Philadelphia.

U.S. Development: Maoz now operates about a dozen units in the U.S. in Texas, Illinois, New York, New Jersey, Pennsylvania and Florida, and the chain is seeking additional U.S. franchise opportunities. In addition to growing its unit count, sales have also been up—from 2012 to 2013, sales at its U.S. units increased nearly 10% to $11.1 million.

Why it’s worth watching: Patrons flock to Maoz for its relaxed service approach that allows customers to add their own toppings to their sandwiches and salads instead of charging by weight, like at other salad bar concepts. Another differentiating factor: Maoz gives out doggy bags to patrons who don’t finish their meal, an amenity typically not offered at salad bars.

TOUS les JOURSTOUS les JOURS-1

 

TOUS les JOURS is a French-Asian bakery café chain. Originating in South Korea, the concept uses high-quality Korean ingredients to make its pastries and breads. The concept’s French and Asian influences are well-represented in its menu, with items that range from French croissants to Korean milk bread to sesame doughnuts. Several years after launching in the late 1990s, TOUS les JOURS began expanding internationally, including to the U.S., where it opened its first stateside location in 2004 in Los Angeles.

U.S. Development: Over the last 10 years, TOUS les JOURS has launched more than two-dozen additional U.S. locations, and now operates nearly 30 sites in California, Texas, Massachusetts, New York, New Jersey, Virginia and Georgia. From 2012 to 2013, the chain opened four units in the U.S. and experienced a 17.9% increase in U.S. sales. TOUS les JOURS plans to open more U.S. locations.

Why it’s worth watching: TOUS les JOURS’ commitment to authenticity and freshness makes it a popular spot for a variety of patrons, from Asian Americans looking for a taste of home to adventure-seeking consumers seeking a different kind of bakery fare.

Max Brenner

Max Brenner

Max Brenner is a concept specializing in all-things chocolate, from hearty desserts to specialty beverages to fondue. The concept’s roots date back to 1996, when it was a small chocolate shop in Israel. In 2001, it was bought by Israel-based Strauss Group, which developed the concept into a full-service chocolate-focused restaurant and bar. The concept expanded internationally, primarily in Australia. In 2006, Max Brenner’s first U.S. location opened in New York City.

U.S. Development: In addition to the original New York unit, Max Brenner now operates four other sites in the U.S. in Boston; Bethesda, MD; Paramus, NJ; and Philadelphia. The chain announced in April that it was moving toward a fast-casual prototype for its U.S. locations in place of the existing full-service format, saying that the fast-casual model better suits U.S. consumers. The Bethesda and Paramus sites— which opened July 2013 and April 2014, respectively—both feature the new fast-casual model. Max Brenner aims to launch about 200 more units in North America.

Why it’s worth watching: In a time when chains are increasingly becoming more health-minded, Max Brenner stands out for encouraging patrons to enjoy one of America’s favorite indulgences: chocolate. With a hip, modern décor and eye-appealing presentations, the novelty concept comes across as more sophisticated than gimmicky, helping patrons feel a little less guilty about enjoying that chocolate pizza or hot chocolate.

CONCLUSION

It would be beneficial for U.S. restaurant operators to pay close attention to these global chains and others that are successfully growing their U.S. businesses. With chains making moves to further cement their U.S. business—from Hakkasan acquiring a stake in a San Diego multiconcept operator to Coffee Culture establishing a U.S. headquarters—it’s likely these chains will be competing with U.S. operators for years to come.


Don’t Count Out These Legacy Brands

May 2, 2014

It’s no surprise that the restaurant industry is a tough place to do business, especially now, when diners are more aware of restaurant operations and concepts have been tasked with meeting a variety of needs. Patrons crave both indulgence and better-for-you options. They seek authentic ethnic fare, but they also want items with local ingredients. Fresh, made-to-order items are key … but so is speedy service.

Clearly, chain restaurant operators have a lot on their plate.

With fickle patrons, increased competition and the still-recovering restaurant industry, some once-top restaurant chains have fallen through the cracks over the last several years and have been struggling to regain their foothold. For some, the loss in sales and unit counts may be too much and they may never return to the top. But that doesn’t mean they’ve given up. From brand refreshes to new concepts to international expansion, the following legacy chains are showing they’re committed to doing all they can to revamp their company.

1. Bennigan’s

Bennigan’s was a casual-dining pioneer. Developed by Norman Brinker and debuted in 1976, the “fern bar” offered a casual menu and heavy adult-beverage focus in an Irish pub setting. Bennigan’s grew rapidly in the ‘80s and ‘90s, along with the then-novel casual-dining segment.

BennigansExteriorEndcap-1_500

What went wrong: As competition increased, Bennigan’s failed to keep pace with the likes of Chili’s and Applebee’s, and its menu, stores and service grew tired. Following then-parent S&A’s Chapter 7 bankruptcy in 2008, all company-owned stores were shuttered; many franchised restaurants followed suit.

What’s happening today: The system was taken over by Atalaya Capital Management LP and CRG Partners, which refueled the chain over the next few years. Today, Bennigan’s has a new logo, restaurant prototype, menu and service emphasis, all meant to return the chain to its social pub roots to spark nostalgia in lapsed customers while attracting younger guests. According to Bennigan’s CEO Paul Mangiamele, the chain is steadily increasing its domestic store count while continuing to expand overseas, with expansion plans in place for India, Korea, Central America and other international markets.

While much has changed, fans of the chain will be delighted to know they can still get their World Famous Monte Cristo sandwich. In addition, in 2013, Bennigan’s announced it’s resurrecting its casual-dining Steak & Ale concept with a new gastropub prototype, set to debut in late 2014. The concept will features some returning traits, such as the chain’s famous salad bar, as well as some new features like a less cluttered décor, stained-glass windows that allow for a partial view of the kitchen, and a “Prime Rib Roaster” displayed in the dining room.

2. Fazoli’s

Fazoli’s was launched in 1988 by Jerrico Co., the same company that founded Long John Silver’s. With large, welcoming dining rooms and perks like unlimited breadsticks, the concept was promoted as an affordable alternative to casual-dining restaurants and grew rapidly in the ‘90s.

FazolisExteriorFreestanding_500

What went wrong: With its carb-heavy menu, Fazoli’s was hit hard by the low-carb craze in the early 2000s. And as chains like Olive Garden and Domino’s improved their recipes and new Italian concepts like Piada Italian Street Food entered the mix, Fazoli’s struggled to keep up. Between 2002 and 2012, the number of Fazoli’s units in the U.S. fell by 44%.

What’s happening today: Fazoli’s is striving to be a solid competitor in the fast-casual Italian segment, with 10 units in the pipeline for 2014. In recent years, the company has revamped its menu, switched to using real plates and silverware, and changed its service model—instead of patrons receiving their food at the counter, servers bring their meal to their table and refill their beverages.

Additionally, in 2013, Fazoli’s debuted a new fast-casual concept, Venti Tre, that offers made-to-order piada sandwiches, pasta and salads that can be customized from a choice of at least 23 ingredients. The chain also launched a smaller prototype to fuel expansion in nontraditional locations such as mall food courts and travel centers.

The changes appear to be working—Fazoli’s said its unit count stabilized in 2013 after a decade of closures, and the chain has reported positive same-store sales 36 out of the last 45 months for its company-owned restaurants and 46 out of the past 48 months for its franchised units.

In a March 11 news release on the chain’s positive sales, Fazoli’s President and CEO Carl Howard emphasized its dedication to service and quality fare, saying, “the combination of increasing service after the point of sale and providing our guests with highly craveable products, all at a price point under $7, is proving to be a winning formula.”

3. Ponderosa/Bonanza

Ponderosa and Bonanza began as separate steakhouse concepts in the 1960s and were consolidated into one brand in 1997 by then-parent company Metromedia Restaurant Group. By that time, Ponderosa/Bonanza had more than 600 units. Patrons frequented the chain thanks to its affordable options and all-you-care-to-eat buffet.

PonderosaExteriorFreestanding_500

What went wrong: Over the years, Ponderosa/Bonanza has faced stiff competition from casual-dining steak concepts like Outback Steakhouse and Texas Roadhouse, who offered higher-quality steaks for just slightly higher prices. In addition, patrons seeking variety began turning not to buffet concepts but to varied-menu casual-dining chains, as patrons started to value quality over quantity. In 2008, Metromedia Steakhouses Co., the division of MRG that operated Ponderosa/Bonanza, filed for Chapter 11 bankruptcy. At the time of the filing, there were more than 300 Ponderosa/Bonanza units systemwide. By the end of 2013, the company had about 220.

What’s happening today: In 2013, Ponderosa/Bonanza brought on a new president and CEO, Tom Sacco, and under his leadership, the company has debuted plans for a brand refresh that it’s been rolling out this year to all locations. The refresh includes interiors with brighter and fresher graphics, menu boards with digital displays and a redesigned buffet area with eco-friendly plateware. Menus are also being revamped with new appetizers, entrees and healthier fare, plus seasonal menu enhancements such as topped steaks and globally inspired seafood options.

The company has also been expanding internationally, particularly in the Middle East. In mid-2014, the company is scheduled to launch a new, full-service, more relevant Bonanza Steakhouse positioned to compete with other full-service, casual-dining steakhouses. Later this year, Ponderosa/Bonanza plans to launch a third steakhouse brand—a new, more contemporary concept—targeting the 25–45 demographic.

4. Sbarro

Sbarro’s history dates back to 1956 when the Sbarro family emigrated from Naples, Italy, and opened an Italian grocery store in Brooklyn, NY. There, they served authentic Italian fare such as made-from-scratch pizza and pasta. In 1967, the Sbarro family launched the chain’s signature quick-service mall prototype in Brooklyn’s Kings Plaza Shopping Center. The mall prototype allowed Sbarro to rapidly expand, and by 2010, it was operating more than 1,000 units in 41 countries.

SbarroExteriorEndcap_500

What went wrong: Like Fazoli’s, Sbarro was hurt in the early 2000s when no- and low-carb diets were popular. Also, as a predominantly mall-based concept, Sbarro suffered as a result of the recession and decline in mall traffic. In April 2011, the chain filed for Chapter 11 bankruptcy to reduce their debt by approximately $200 million. The company emerged from bankruptcy at the end of 2011. In February 2013, with mall traffic continuing to decline, Sbarro closed about 180 company-owned U.S. units that were underperforming. In March 2014, Sbarro again entered Chapter 11 bankruptcy as a result of their remaining debt burden and the number of underperforming mall locations.

What’s happening today: With new leadership and a revamped infrastructure, Sbarro is restructuring the brand to better position it for future growth. The company said it’s undergoing “a complete rebranding with an emphasis on the determination and commitment to pride, passion and doing things right that the family inspired over 50 years ago.”

Sbarro is emphasizing its signature New York pizza, baked fresh all day in traditional stone ovens and featuring made-from-scratch dough prepared daily, San Marzano-style tomato sauce and hand-shredded 100% whole-milk mozzarella. The chain is also heightening its execution with improved operational performance and equipment to ensure every slice is sold hot and fresh.

To balance financial growth with an off-mall presence and to capitalize on the growing fast-casual pizza segment, Sbarro debuted a new fast-casual concept, Pizza Cucinova, in Columbus, OH, in 2013. Pizza Cucinova currently has two locations in Columbus and offers traditional Italian-inspired artisan-style pizzas and salads for lunch and dinner.

Sbarro executives say the reorganization and rebranding are off to a strong start and that they’re excited to begin a new chapter for the company.

5. TCBY

TCBY, which stands for “The Country’s Best Yogurt,” has been serving frozen yogurt since 1981. The global quick-service chain offers both hand-scooped and soft-serve treats made with real dairy yogurt. In 2000, it was acquired by Mrs. Fields Famous Brands (now Famous Brands International), who launched cobranded TCBY/Mrs. Fields units.

TCBYExteriorInline_500

What went wrong: TCBY was hit hard by increased competition in the frozen-dessert sector from premium ice-cream concepts like Cold Stone Creamery and the rise of self-serve frozen-yogurt chains like CherryBerry. TCBY introduced its own self-serve frozen-yogurt prototype in 2010, but the chain was already in decline. Between 2002 and 2012, TCBY closed 1,188 units.

What’s happening today: TCBY has seen modest unit growth in recent years and is seeing that growth accelerate in 2014, fueled by a change in ownership in 2013. That summer, global asset management firm Z Capital Partners acquired TCBY parent company Famous Brands International and launched an expansion plan for 50 TCBY units—all self-serve prototypes—in the U.S.

In the last year, Famous Brands has made key personnel changes by appointing a new CEO and senior vice president of strategic development, has introduced more healthful treats such as dairy-free Silk Chocolate Almond frozen yogurt made with Silk almond milk, and has driven franchise growth with TCBY and Mrs. Fields cobranded stores. This year, the chain plans to open 85 units and focus on its new in-store gifting business.

6. Tony Roma’s

Tony Roma, a former Playboy Club manager, opened his first namesake restaurant in Miami in 1972. It became known for its baby-back and St. Louis-style ribs—along with an extensive menu of steaks, chicken, burgers and seafood—served in a relaxed atmosphere. Three years later, the concept was purchased by Dallas Cowboys owner Clint Murchison and attorney Jack Peeples. NPC International Inc., the largest franchisee of Pizza Hut, acquired the chain for $20 million in 1993 and spun it off in 1998 to Sentinel Capital Partners.

TonyRomasExteriorFreestanding_500

What went wrong: The brand has been struggling in the U.S. for some time. After filing for Chapter 11 bankruptcy protection, Sentinel sold Romacorp to bondholders as part of its restructuring in 2006. Between 2002 and 2012, Tony Roma’s closed 114 units in the U.S. The chain ended 2013 with 37 U.S. locations and a 9.2% decline in U.S. restaurant sales.

What’s happening today: Tony Roma’s is expanding both domestically and internationally, recently launching units in Bloomington, IL; Brooklyn, NY; Chile; Kobe, Japan; and Malaysia. The chain operates more than 150 units in 34 countries, and at least 17 new Tony Roma’s restaurants are expected to open domestically and internationally over the next year.

In the last 12 months, the chain has signed more development deals than it had signed in the last four years, including a deal to open 25 units in India, Bangladesh, Sri Lanka and Nepal. Tony Roma’s also plans to launch another New York location in Long Island, two more sites in Malaysia, at least three restaurants in Myanmar and has signed several development agreements for Mexico’s Yucatan and San Luis Potosi markets.

Additionally, Tony Roma’s debuted a new concept, Tony Roma’s Fire Grill & Lounge, at its renovated Orlando site late last year. Designed to appeal to a younger demographic, the restaurant features a chef’s table, an open kitchen, a fire pit and a lounge area along with a new menu that Tony Roma’s is considering rolling out to other locations. The menu only features a few rib options and instead highlights gourmet entrée selections like pan-seared Alaskan cod with eight-vegetable hash, pearl couscous, red quinoa and lemon-basil pesto. A second Fire Grill & Lounge is slated to launch in the fall in Winter Park, FL.


The Proliferation of the Coffee Café

March 10, 2014

As one of the most successful chains in the coffee-café segment, Starbucks is the dominant category leader. This 40-plus-year-old brand has successfully grown to more than 11,000 U.S. locations, with sales topping $11 billion, accounting for a U.S. market share of nearly 55% of coffee cafés. Loyalty is strong and American consumers are in love with their Starbucks.

The segment continues to be the high-growth industry leader with Dunkin’ Donuts and Tim Hortons rapidly expanding. But consumers are finding new ways to brew specialty, gourmet coffee at home with branded K-cups and Nespresso pods, making it more affordable and convenient to do it yourself. So what are the challenges ahead for coffee cafés?

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Saturation Is Inevitable!

Same-store sales growth will ultimately hit a ceiling, and with consumer sensitivity to price increases, sales growth will become a greater uphill battle.

Coffee-café segment competition will heat up, and new national chain, regional chain and independent units will increase major market penetration. Smaller rural and suburban markets will be getting more attention. Fast-casual brands in the bakery-café segment like Panera Bread, Einstein Bros. Bagels and Corner Bakery will also create new options for consumers as more locations open. Quick-service brands like McDonald’s will provide lower-priced, drive-thru convenience that provide value-seekers with a strong level of quality that is also affordable. Brands like Subway and Taco Bell’s entry into breakfast will create new formats and offerings that appeal to consumers, taking some wind out of the coffee-café segment’s growth sails.

So Where Are We Headed?

Coffee cafés will continue to focus on brand opportunities that increase check average as guest counts decline through greater saturation. New emphasis on the quality of baked goods, healthy food options and snacking will provide fuel to drive higher sales. On the beverage side, consumer demand for quality teas and fresh-pressed juices will give consumers more reasons to increase spend and look to coffee cafés for better-for-me food and beverage.

Aging stores will require remodeling, and new technology integration is a necessity to remain relevant to consumers, because long lines force loyal fans to go elsewhere to avoid the wait and get similar quality and prices elsewhere. Interactive, high-quality service will become a standard, and experienced baristas will look to competitors for career and compensation growth.

How Do You Make a Difference?

Strong efforts by front-line staff to provide fast, accurate and engaging service with a smile, keeping units clean, and continuing to provide high levels of value through menu, price, ambiance and strong emphasis on the overall consumer experience will give brands who invest a huge advantage.