Gandy Restaurant Project Mixes Food Trucks, Waterfront Ambiance

October 28, 2013

tbo.comA year ago, Scott Tashkin had sold his stake in a staffing firm and was having a drink with his wife at the I.C. Sharks bar in St. Petersburg when she pointed to the derelict property next door that used to be the Banana Boat bar.

“So we walked over and I guess that’s how it started,” Taskin said. Not long after, Tashkin purchased the property and after months working from a construction trailer, the site is shaping up to become Tampa area’s next luxury beach-side bar restaurant called The Getaway. “We’ve just always wondered why Tampa doesn’t have more waterfront places with all this water around us.”

So they’re building one, and this restaurant and bar will have the hippest of twists. Though the landscape will be lush and the drinks especially upscale, there will be no permanent restaurant kitchen. Instead, there will be a steady rotation of the hippest food trucks in Florida to provide food to an all open-air bar space along the water.

“At some point, maybe we build our own kitchen,” Tashkin said. “But when we floated this idea of bringing in food trucks, people got really excited.”

To pull off his project, Tashkin partnered with David Burton, an operator of local Pizza Fusion locations. When complete, the project could reach a $3 million budget for the land and construction. That includes floating docks with 30 boat slips. And there will be two tiki areas, one with a 1,600 square foot, open-air drinking and dining space, and another “dockside” bar near the boats.

The location sits just at the western landing of the Gandy Bridge in Pinellas County, and it faces south toward a set of mangroves and small islands. So a dockmaster at the Getaway will also rent out kayaks and paddleboards for anyone who wants to explore. Luckily, the site was already permitted for dock space, even though most had fallen into disrepair before construction started. Also luckily, the site sits midway between the decidedly gritty “Beercan Beach” on the south side of the Gandy causeway where people drive right up to the water for fishing and drinking, and the decidedly upscale office parks further inland and the affluent areas around Snell Isles and Coffee Pot Bayou.

During a recent tour of the space, a pair of boaters broke down just off the soon-to-be-built dock space — as their outboard motor battery died — and they drifted up to the waterfront space. “Hey, when do you guys open,” the boater asked. “Soon as we can,” Tashkin replied.

People should expect far more than just a thatched roof, Tashkin said. He’s hired architects who designed many of the most upscale Key West restaurants. There will be lush landscaping, a covered walkway from the parking lot, a fireplace pit by the water, a tiki-covered fish pond, thatched band stage, and all drinks made with fresh ingredients — not pre-made mixers.

Though there are not a lot of beach-side places, there are a few recent projects in the area, including the Hulk Hogan-themed “Hogan’s Beach” restaurant on the Courtney Campbell Causeway. The Gulf side has far more watery places, including the Salt Rock Grill, Frenchy’s Rockaway Grill, Crabby Bill’s and the Hurricane in Pass-A-Grille.

At one point, Tashkin and Burton had envisioned building out the derelict Banana Boat bar into a kitchen for the overall operation, but going with the food truck trend sparked huge interest, Tashkin said, and he’ll spend the next few weeks sorting out which ones will be in the first rotation.

Some elements of this plan match with especially hip trends in restaurants, said Darren Tristano, a restaurant consultant with the market research and consulting firm Technomic. Besides the numerous food truck festivals that seem to grow bigger each year, at least a few restaurants are embracing food trucks — which had been seen as their natural competition for customers.

“In Austin, there are a number of bars where you order food at a stand behind the bar,” Tristano said. “If there’s a trend here, it’s the bring-your-own food trend.” The Getaway, he said, will have to balance the desire of customers for a consistent menu, with the allure of “Who knows what will happen tonight” adventure of just going to a beach bar to find out which food truck came, too.

Kathy Hayden, Editor-in-Chief of Food+Service Magazine, said food truck “clusters” are popular in cities such as Portland, Ore., that has several permanent places to park in the city.

She also notes the Truck Yard burger bar/beer garden in Dallas that launched with food truck service in an outdoor beer garden, serving steak sandwiches.

“The idea of gathering food trucks makes sense,” she said, “especially where weather and local regulations are agreeable.” The question in her mind is whether any such restaurant can make money off a variety of trucks, unless they end up charging rent/parking fees.

Meanwhile, contractors at the Getaway this week started to put up the major poles that will hold up the tiki bars, and if all goes according to plan, the restaurant will have a soft opening in November and a full opening in December.


Industry Evolution

October 1, 2013

U.S. restaurant chains of all stripes are taking on fast-casual attributes to evolve their concepts and remain relevant to consumers.

Change is one of the few constants in the restaurant industry. Whether restaurants are adding another daypart, updating the décor or introducing new prototypes, the best foodservice operators understand that, to succeed in the business, they should be aware of the unpredictability of the industry and be open to evolving.

In the past few years, we’ve seen many U.S. concepts make some key changes to keep up with the restaurant industry’s best performer: the fast-casual segment. Thanks to customisable and craveable options, premium ingredients and quick service, growth of the fast-casual segment is outpacing that of the quick-service and full-service sectors. As reported in Technomic’s Top 500 Chain Restaurant Report, turnover for the restaurant industry as a whole from 2011 to 2012 increased 5.2%, including a 5.8% rise in limited-service turnover and a 4.5% increase in full-service turnover. In comparison, turnover for the fast-casual segment increased 13.0% from 2011 to 2012, and that growth is expected to continue.

To compete with fast-casual restaurants, quick-service and casual-dining operators are branching out of their comfort zones to find different ways to reach new consumers as well as retain their customer base. Full-service chains such as Applebee’s and Red Lobster have introduced fast-casual elements to attract on-the-go consumers, and Burger King, which receives most of its business from drive-thru and carryout orders, added delivery service to increase its convenience factor. Other chains like Auntie Anne’s and Chick-fil-A are using food trucks to generate brand awareness by bringing their food to festivals, sporting events and community gatherings.

It’s not just existing chains that understand the need to evolve. The latest crop of limited-service pizza concepts, which includes Pie Five Pizza Co. and MOD Pizza, functions more like a Chipotle than a Pizza Hut. Patrons create their pizzas by making their way through an assembly line-style queue, choosing a crust, sauce, cheese and toppings as they go. They then receive their pizzas in minutes, sometimes by the time they reach the cash register. This style of ordering allows diners to be much more involved in the pizza-making process than at a traditional limited-service pizza concept, where patrons usually don’t watch the preparation of their pizzas. The customisability and quick service are some of the reasons why Technomic predicts made-to-order fast-casual pizza concepts are the next “better burger.”

Below are some examples of operators thinking outside of the box in order to keep their concept relevant in the ever-changing restaurant industry.

Full Service to Limited Service

In the U.S., the limited-service sector is growing at a faster rate than the full-service segment, leading some of the country’s top full-service chains to experiment with limited-service prototypes. In August, midscale chain Bob Evans launched Bob Evans Express, a new counter-service prototype for nontraditional venues such as corporate offices, universities and shopping malls. The new format, which offers a limited menu of hot foods along with packaged items, was designed to expose patrons who otherwise wouldn’t have the time to visit a sit-down Bob Evans restaurant to the chain’s signature homestyle breakfast and lunch offerings.

Earlier this year, U.S. casual-dining seafood chain Red Lobster began testing a new limited-service offering, Seaside Express, at two of its Florida locations. Patrons visiting the restaurants can choose either the standard full-service Red Lobster dining experience or order from the Seaside Express counter, which offers a menu of mains such as burgers, sandwiches and flatbreads, priced between $6.99 and $8.99 (approximately £4.50 and £5.79). After ordering, customers seat themselves and a server brings out their food. Because patrons pay for their meals at the counter, the concept is meant to appeal to diners who are pressed for time and may not like waiting for a cheque to be brought to the table. It also appeals to those looking for a discounted Red Lobster experience—the Seaside Express menu features lower-priced mains compared to Red Lobster’s standard menu.

Also earlier this year, Applebee’s expanded its limited-service model, Applebee’s Express Lunch, to 23 company-owned locations in the U.S. The format, first launched in Kansas City in July 2012, is similar to Seaside Express, in that patrons choose to either sit down and be waited on or order their meal from the Express counter, then seat themselves. The menu features pick-two combos starting at $6.99.

Applebee’s launched a fast-casual offering, Applebee’s Lunch Express. Patrons order at a counter then seat themselves, and a server brings their food to their table.

Applebee’s launched a fast-casual offering, Applebee’s Lunch Express. Patrons order at a counter then seat themselves, and a server brings their food to their table.

The Un-Delivered Pizza

Today’s trendiest limited-service pizza concepts don’t focus on delivery—in fact, most don’t even offer it. Fast-casual pizza concepts such as Uncle Maddio’s Pizza Joint and Blaze Fast Fire’d Pizza are revolutionizing the limited-service pizza industry by specializing in create-your-own personal pizzas. Thanks to high-tech pizza ovens that cook pies at incredibly high temperatures, patrons no longer have to call ahead to place a takeaway order or sit at their house waiting for a pizza to be delivered. Now, customers can simply line up at a counter, choose their crust, sauce and premium toppings, and either have their pizzas ready for them by the time they reach the cash register or brought to their table by a server in minutes.

One of the largest points of differentiation is that these fast-casual pizza concepts focus on dine-in service. Instead of operating out of small, minimally decorated counter units, these restaurants feature a hip, chic décor and plenty of seating to attract dine-in consumers. Most also menu adult beverages, a characteristic that attracts value-seeking consumers on a dinner date or group outing who may not have the funds to visit a full-service restaurant and provide a tip.

Décor at Uncle Maddio’s Pizza Joint units (top) includes abstract wall dividers and a word wall, dominated by the phrase “Served with love.” Pie Five Pizza Co. units feature science-themed murals, such as a periodic table that replaces the elements with Pie Five pizza ingredients.

Décor at Uncle Maddio’s Pizza Joint units (top) includes abstract wall dividers and a word wall, dominated by the phrase “Served with love.” Pie Five Pizza Co. units feature science-themed murals, such as a periodic table that replaces the elements with Pie Five pizza ingredients.

These new concepts haven’t gone unnoticed by the quick-service pizza sector. Pizza Inn, a U.S. pizza chain that consists mostly of buffet and counter-service restaurants, launched its own fast-casual made-to-order pizza concept, Pie Five Pizza Co., in 2011, which has since grown to 14 locations. Sbarro, another U.S. quick-service pizza chain, is set to debut a fast-casual pizza concept, Pizza Cucinova, later this year.

Not all pizza chains are launching fast-casual concepts; some are instead choosing to incorporate fast-casual elements into their existing concept. Within the past few years, Domino’s Pizza has converted dozens of restaurants into its Pizza Theater prototype. The model still functions like a typical Domino’s Pizza unit but features a comfortable dining room and an open kitchen for patrons to watch the preparation of their pizzas. Other new elements to the Pizza Theater prototype include ordering kiosks, electronic order tracking, and chalkboards where customers can doodle and leave feedback while waiting for their order.

Quick-Service Delivery

In contrast, some quick-service concepts are updating their concepts by adding delivery services. In 2012, Burger King launched delivery in the U.S. at select locations in Washington, DC, and has since expanded the service to select markets in 14 states, from California to Illinois to New York. The chain boasts that hot food is delivered hot and cold food is delivered cold, thanks to new innovative packaging. The service is designed for large orders (a minimum order amount of $10 is required), so in addition to Burger King’s standard offerings, the delivery menu also features several large combo meals, like a four-sandwich bundle with fries and an option with 10 cheeseburgers and 20 chicken nuggets.

A loyalty program specifically for customers using the delivery service has been implemented to bring in more users. Those who use the service and are enrolled in the loyalty program receive a free sandwich with every fourth order.

Burger King launched delivery service in select markets in the U.S. The delivery menu features Burger King’s traditional offerings along with large combo meals.

Burger King launched delivery service in select markets in the U.S. The delivery menu features Burger King’s traditional offerings along with large combo meals.

It will be interesting to see if the service succeeds and if other concepts will be inspired to launch delivery. Burger King says customers in the U.S. have embraced the new option, and it continues to expand delivery to other U.S. markets, most recently to Washington State and Minnesota. But so far, it appears only one other major U.S. quick-service chain, White Castle, has followed suit. The popular burger chain has been testing delivery at a restaurant in Columbus, OH, since earlier this year and recently added delivery to a second site in Columbus, but it hasn’t discussed any plans to expand the service nationwide.

Key Takeaways

While the fast-casual segment is booming in the U.S., it is relatively new in the U.K.—only seven of Technomic’s Leading 100 U.K. Chain Restaurants are classified as fast casual. However, all of those chains posted turnover increases in 2012, and three of them–Patisserie Valerie, PAUL and Le Pain Quotidien–reported double-digit turnover growth. As a group, they increased sales by 8.5% and grew their unit count by 6.6%.

With these numbers, along with the recent entry of U.S. fast-casual concepts like Shake Shack and Five Guys Burgers and Fries in the U.K., we can expect the U.K. fast-casual sector to continue growing. Thus, it’s likely we’ll see top quick-service and casual-dining chains in the U.K. evolve their concepts to compete with the growing fast-casual segment.


Many New Yorkers Were Opposed to the Sugary Beverage Ban

December 27, 2012

12-12_0Our athletes went to the Olympics, our science went to Mars, and our people went to the polls. But what of the restaurant industry in 2012? These dozen items from the year had the biggest impact on the foodservice landscape and shaped the industry for a potentially game-changing 2013.

An Economy in Flux

The economic recovery isn’t lighting a fire under anyone’s feet, but the economy did at least improve, albeit slightly.

As of August, the National Restaurant Association’s (NRA) Restaurant Performance Index had been positive for nine consecutive months. It has since been weakening, however, indicating operators are less optimistic about economic conditions going into 2013.

“In the winter quarter [of 2012], we started to see things looking good,” says Bonnie Riggs, restaurant analyst with NPD Group, a Chicago market research company. “We thought we turned the corner. But then gasoline prices increased and people pulled back.”

The Congressional Budget Office’s outlook is for the economy to grow less than 2 percent in 2013. The Conference Board, a business group, is slightly more optimistic, estimating growth at 2.2 percent.

However, if Congress fails to avert a series of tax hikes and budget cuts due in January—the so-called “fiscal cliff”—analysts warn another recession could ensue, which could undo any kind of progress quick-service operators have made.

Health Headaches and Solutions

Health issues continue to impact restaurants, both in menu development and how operators deal with the Patient Protection and Affordable Care Act (PPACA), also known as “Obamacare.”

The U.S. Supreme Court this year upheld the constitutionality of most of PPACA.

Many restaurants may need to undergo some significant cost analyses next year to prepare for a wide range of regulations scheduled to begin in 2014.

“We’re going to see a lot of financial modeling going forward, and deciding how to manage the costs,” says Dennis Lombardi, executive vice president of foodservice strategies at WD Partners, a Columbus, Ohio, design and consulting firm. “It seems the way it may be playing out is to find ways to keep employee hours down and make more of them part-timers.”

One portion of the act that may go into effect in 2013 requires chain restaurants with 20 or more locations to display calories on menuboards.

Many companies have decided not to wait for the law’s implementation, though, including McDonald’s. In September, all of McDonald’s 14,000-plus U.S. restaurants began listing calorie counts on menuboards.

The proactive move by McDonald’s “is a real positive,” says Darren Tristano, executive vice president of Technomic Inc., a Chicago consulting and market research firm.

The calorie numbers “may be more of a shock at first, but when [consumers] return, they will still want to indulge,” Tristano says. “That’s what you do when you go out.”

Meanwhile, all types of limited-service operators began offering better-for-you alternatives, from oatmeal to sweet potato fries.

The Big Soda Ban

Any consumer who plans to visit a restaurant in New York City in March or after shouldn’t expect to buy sugar-sweetened beverages larger than 16 ounces. They’re outlawed.

In a stated bid to combat obesity, the city’s Board of Health instituted the ban at eateries, movie theaters, and other venues.

Restaurants call the action unfair, in part because it still allows larger drinks to be purchased at retail outlets and convenience stores. Whether the ban sweeps across the country, like the city’s earlier action against trans fats, is still up in the air.

“We’ll have to take a wait-and-see approach,” Technomic’s Darren Tristano says. “I suspect if history serves us, it will likely become a political issue … and likely will spread to other cities.”

Commodity Costs Rise

The most severe drought in a quarter century has had a serious impact on U.S. agriculture and food prices. The damage done to corn and other crops was extensive and resulted in higher direct and indirect costs.

Many ranchers are running out of grass. Unable to grow enough feed crops—or unwilling to pay for higher priced feed—they are thinning their herds by selling cattle early. That will likely result in fewer cattle going to market next year, making beef and other proteins more expensive, according to the U.S. Department of Agriculture (USDA).

Wholesale beef prices were already up 10.5 percent by 2012’s third quarter, while poultry prices increased 11.5 percent. Heat stress and higher feed costs are expected to reduce pork production as well, the department says.

“If you look at the USDA forecast for a year ago, there was no contingency for a drought of this severity and duration,” says Hudson Riehle, senior vice president of the NRA’s Research and Knowledge Group.

Interactive Imitation

Consumers increasingly want to know more about what’s in their food, and also desire the ability to customize their dishes more than ever before. For years, quick-service concepts such as Chipotle and Subway have capitalized on this desire by giving guests the ability to craft their own dishes, choosing from an array of fresh ingredients.

In 2012, this build-your-own strategy continued to become more rule than exception, expanding into categories like pizza and even ethnic concepts. Newer brands, such as Pie Five, Atlanta’s Uncle Maddio’s, and Washington, D.C.’s Amsterdam Falafelshop, are now thriving on the model.

“We expect to see this basic model growing,” Tristano says. “Customers want to be part of the process, and the visual impact is important. Interactivity engages the customer. This is an emotional connection that makes loyal fans of these restaurants.”

A New Kind of Trade Down

Most of the restaurant industry suffered during the recession, but fast-casual restaurants still performed well. Folks may not have been eating out as often, but when they did, they were looking for quality and value. Many found those attributes at Chipotle, Panera Bread, and their fast-casual peers.

Numerous full-service restaurant companies took notice.

“Casual-dining chains continue to look at whether they have a limited-service opportunity,” Lombardi says. “It allows them to extend the reach of their brand, and in some cases move into areas where full service may not work as well.”

Abuelo’s Mexican Restaurant is one of the latest casual chains to open a fast-casual offshoot, which it did this year with its Abuelo’s Taqueria in Lubbock, Texas. The menu items and pricing are focused on promoting frequent dining.

The opening comes on the heels of several new ventures launched by casual chains in late 2011, including Red Robin’s Burger Works and Pizza Inn’s Pie Five.

Pie Five, which makes handcrafted pizzas in five minutes, has more than a half-dozen corporate-owned locations in the Dallas area.

“We will be looking at other markets [in 2013] from a corporate standpoint, as well as domestic and international franchising,” says Madison Jobe, senior vice president and chief development officer for Pie Five and Pizza Inn.

Other chains launching fast-casual units included Steak ‘n Shake, with its Signature unit in New York; Shoney’s, with Shoney’s On the Go; FATZ, with Tablefields Market Kitchen; and global beef bowl giant Yoshinoya, with Asiana Grill Yoshinoya.

Ethnic Flavors Gain More Exposure

Americans have made Italian, Mexican, and Chinese cuisines their own, so why not something like Vietnamese or Indian?

Pho, a noodle soup, and banh mi, a sandwich typically made with French bread, are some of the latest cultural dishes to hit the mainstream, often with a U.S. twist.

“People were drawn first by the pho, but now banh mi is very popular, especially as a reimagined American sandwich,” says Melissa Abbott, senior director of culinary insights for The Hartman Group, a research and consulting firm in Bellevue, Washington.

“You have a sandwich on really good French bread filled with really fresh ingredients,” she notes. “It has a flavor that is heightened by various fresh herbs and vegetables.”

Tin Drum AsiaCafé, which has 11 units in the Atlanta area, serves cuisines from around Asia, including pho. Owner Steven Chan says the chain had banh mi on the menu a decade ago and may bring it back “because it’s getting popular again.”

Giving an American twist to Indian food is what Qaiser Kazmi is doing in Washington, D.C. His restaurant, Merzi, features Indian-inspired cuisine with U.S. touches. For example, Merzi serves tandisserie chicken, which is tandoori chicken cooked rotisserie style.

“Our cuisine is not directly from India,” Kazmi says. “We would never leave skin on chicken back there. But I fell in love with rotisserie chicken and wanted to combine that with something that has Indian flavors.”

The Reverse Food-Truck Trend

For Kim Ima, opening the Treats Truck Stop in Brooklyn last year was the logical next step for the owner of a popular food truck.

“I like that I had established my business before opening the storefront,” she says of her truck, the Treats Truck, which has served treats and drinks since 2007. The restaurant offers homey comfort food for breakfast, lunch, and dinner.

Food-truck operators across the country, from Boston to Los Angeles and Houston, are similarly turning to brick and mortar.

In the five years since the gourmet food-truck phenomenon began on the coasts, thousands of these vehicles have hit the nation’s streets, giving budding restaurateurs a relatively inexpensive entry into the business. But it’s not easy.

“You’ve got this small space, gas costs, repairs, weather, licensing—all kinds of issues,” says David Weber, president of the NYC Food Truck Association. “So a lot of food-truck entrepreneurs, once they develop a brand, are looking for more stability. It’s logical to take their concept and give it a home.”

The Future of Social Media is Here

Now that many restaurants have found ways to take advantage of Facebook, Twitter, and YouTube, they’ve moved on to other, newer social media platforms, such as Pinterest.

Pinterest is akin to a visual bulletin board, where images can be “pinned” to virtual boards. They can be downloaded to the board or can be taken from (and linked to) other websites.

Dunkin’ Donuts, for example, uses photos on Pinterest to link to various events, as well as products, including limited-time offers.

“Pinterest seems a way for the social media strategy to involve more of the customer and the community,” Tristano says. “Instead of pushing out from the company, this is trying to draw customers in to be part of it, to have a shared experience.”

Don’t Forget Boomers

While focusing on Millennials is all the rage, many restaurant operators also understand that Baby Boomers still make up a lot of the nation’s buying power. Members of the generation are looking to dine at places that feature unique flavors and provide plenty of value.

“It’s really the Boomers and those over 65 that are keeping the [restaurant] industry from experiencing a decline,” NPD’s Riggs says. “Boomers are increasing their visits to all restaurant types, but particularly quick service … and fast casual.”

Of course, younger diners typically will be the first to hear about new and exciting limited-service restaurants.

“The Millennial kid knows where the cool stuff is and will tell mom and dad to try it,” Abbott explains. “They are more tapped into the social network. But the parents are increasingly curious to try new places. In the past, that may not have been so.”

Exploring the IPO

One major quick-service restaurant company went to market this year with a big stock deal, while another chain’s plans to go public didn’t get off the ground.

Burger King took its crown back to Wall Street. The Miami-based company’s shares began trading publicly through an unusual deal in which investment firm Justice Holdings paid $1.4 billion to acquire a 29 percent stake from owner 3G Capital.

CKE Restaurants, the Carpinteria, California, parent of Carl’s Jr. and Hardee’s, had planned a $200 million public offering but delayed it. Concerns were raised about the impact of required health-care costs and rising commodity prices.

“The market was willing to give restaurant companies a premium valuation early in the year,” says R.J. Hottovy, restaurant industry analyst with Morningstar in Chicago. “A lot of them were operating at peak margins. Since then, there have been some concerns about the industry’s fundamentals.”

Brand Evolution Continues

Quick serves are always tweaking their images, but there were some major changes in store for menus at some larger chains in 2012.

One of the most notable chains to do this was Burger King, where an array of new menu items, including smoothies, salads, chicken wraps, and specialty coffee drinks, were added to broaden the brand’s customer base. That was the first part of a four-pillar, $750 million strategy Burger King announced in the spring.

Taco Bell also welcomed major menu innovations. The Irvine, California–based brand launched the highly successful Doritos Locos Tacos, featuring shells made with the taste and flavor of Doritos snack chips. Then the chain rolled out a Cantina Bell line of upscale burritos, bowls, and sides created by noted chef Lorena Garcia.

Taco Bell also introduced breakfast at about 800 West Coast locations.

“What Taco Bell has done is a testament to product innovation,” says restaurant analyst Hottovy. The chain “remains in its core competency, broadens its appeal, and takes the pricing point upward.”


The Joy of Innovation

May 28, 2012

By Danielle Douglas and Jeffrey MacMillan, April 29

If you stop in at 944 Florida Ave. NW around 8 a.m., you can get an herb frittata with a hazelnut latte from Blind Dog Cafe. Come back again at 8 p.m. and you can down a Heineken at Darnell’s Bar. Same place. Different owners. One lease.

Friends Noah Karesh, Jonas Singer and Cullen Gilchrist approached Darnell Perkins back in November about running a temporary coffeehouse in his saloon during the off-hours. The trio, who were customers, wanted to gauge the neighborhood’s interest before committing to leasing, refitting and operating a stand-alone space.

“We figured why put all of that capital into a cafe, when we haven’t proven that it could work,” Karesh said.

Blind Dog Cafe is part of an entrepreneurial movement in the local food scene that is ushering in new restaurant concepts, from food trucks to underground supper clubs, that stray from the traditional model. These entrepreneurs are readily using social media and mobile technology to market their businesses as they go head to head with established restaurants.

That such a spurt of innovation is transforming the restaurant industry should come as no surprise. Pushing a food cart or opening a carryout have always been one of the gateways to entrepreneurship because of the universal demand for food.

But the simplicity of the business model means the competition can be fierce and failure commonplace. Which is why this generation of restaurateurs is seeking out low-cost entry into the marketplace, said Darren Tristano, executive vice president at Technomic, a research and consulting firm.

“When you think about food trucks, the overhead is very low and it allows a certain freedom and flexibility,” he said. “People want to work on their own terms, be more creative.”

Pop-up eateries

In the case of Blind Dog Cafe, Karesh said “necessity was the mother of invention” as the paucity of coffee shops in Shaw inspired him to open his own. He roped in Singer, whom he grew up with in Chevy Chase, and Gilchrist, a line cook at Ardeo + Bardeo in Cleveland Park.

Sharing an already leased and licensed space has saved them hundreds of thousands of dollars in start-up costs. The three pay Perkins about $800 a month to rent the space. Karesh and his partners spent $20,000 to get the cafe up and running in January, most of the money went to purchasing equipment for brewing coffee and baking.

The laid-back atmosphere of the bar, complete with a well-worn comfy couch, already captured the homey vibe they were going for, so they only added a few shelves and tables.

The cafe, named for Singer’s blind Jack Russell terrier Baxter, attracts a mix of telecommuters looking for free Wi-Fi and endless caffeine. Karesh envisions Blind Dog as communal space for entrepreneurs, so he has begun inviting area start-ups, including artisan ice cream makers and vintage stylists, to host events in the cafe for free — pop-ups within a pop-up.

Culinary societies

One of the recent events held at Blind Dog involved a 45-person dinner party hosted by Feastly, a company that signs people up for “feasts” prepared by amateur chefs.

Feastly, co-founded by Karesh and Danny Harris, is the outgrowth of a pitch the pair made during November’s D.C. Startup Weekend. Karesh came up with the idea after having a hard time finding authentic cuisine while on vacation in Guatemala.

“The concept of using the dinner table as that original social network was something that really appealed to both of us,” Harris said.

Chefs can set the price of the meals and other house rules and choose how many people they want to serve under the model. On average, a feast costs around $30 per person. Karesh and Harris take up to 25 percent of the total proceeds from the dinner.

People can sign up to receive e-mail alerts on upcoming feasts. “We are leveraging technology to create vibrant communities,” Karesh said.

Kauffman Foundation vice president Lesa Mitchell said trusted online platforms, be they social network groups or referral sites such as Yelp, have become a driving force in the food industry. “Reputations can develop or be destroyed overnight because of technology,” she said. “There is greater immediacy in the response to these concepts.”

In the same vein as Feastly, The Coterie is an online marketplace that connects foodies with exclusive dining opportunities. For $42 a month, members gain access to cocktail parties and salon-style dinners. They also get access to a reservation system through which they can arrange for five-course tastings at one of five partner restaurants, including Fiola and Bibiana, for $135 a person.

“Our value proposition is connecting curious dinners with innovative chefs,” said Jill Richmond, who co-founded The Coterie with Nick and David Wiseman. “What underpins what we do, especially with the fireside dinners, is providing connections that are more meaningful than just having a great experience at a restaurant.”

Richmond, a consultant at the World Bank, started the culinary salon under the name No. 68 Project in London in March 2010. When her job led her back to the states a year later, she revived the project as a nine-week pop-up restaurant in the District.

The underground scene

Area foodies are dispelling the notion that Washington is too conservative to embrace experimental concepts. Underground dinner parties, where guests are not allowed to disclose the location or the host’s identity, have been gaining popularity in the past two years.

Dinner requests are growing at the Web site for underground restaurant Chez La Commis. Tom, the chef who requested anonymity to maintain privacy, started sending out e-mails to friends of friends in January to try out his creations.

A public relations executive by day, budding chef by night, Tom serves six-courses, with three wine pairings, for $40 out of his home in Clarendon. Word got out in the blogosphere about his dishes, such as crab salad with cucumber granite, and foodies started e-mailing requests to attend his clandestine supper club.

“Because there is no barrier aside from the cost of ingredients, you can get as creative as you want,” Tom said. “When you free people from the formal setting of a restaurant, the atmosphere becomes more lively. That matches the type of food I put out.”

What started out as a once a month event now occurs three to four times a month. “This is an investment in finding out whether I can eventually do my own restaurant,” Tom said.

Meals on wheels

No recent restaurant trend has garnered quite the attention as food trucks have. The new era of curbside cuisine, rife with gourmet concepts, has spawned well over 100 mobile vendors in the region since 2009.

“The evolution of mobile food service now has been fueled by the sustained period of economic weakness,” said Hudson Riehle, senior vice president of research at the National Restaurant Association. “Consumers find it more cost efficient to purchase food from these vendors than paying for a meal at traditional restaurant.”

Fojol Bros. of Merlindia, which debuted its Indian fare during the inauguration of President Obama, was one of the first rolling restaurants to hit D.C. streets.

Since then, the team behind the “culinary carnival” has launched three other food trucks, including Ethiopian-inspired Benethiopia. Their newest truck, Volathai, is outfitted with two propane-powered woks for cooking the Thai cuisine.

The company, which became profitable two months ago, has no designs on fixed sites to grow the business.

“People enjoy the informality of eating outside; it’s like a live social network for them,” said Justin Viterello, who, along with his mother Virginia Viterello and friend Peter Korbel, owns Fojol Bros. “There is now a culture behind eating outside … that’s exciting.”

Pickup artists

Jenna Huntsberger, the D.C.-based baker behind Whisked!, is not ruling out launching a food truck. But given the number already on the road, she is happy selling her sweet and savory pies, cookies and cakes online, at farmers markets and pickup sites.

“There are other ways to sell to the public without having to take on the overhead of having a brick-and-mortar space,” she said.

Huntsberger and her former partner, Stephanie Willis, started selling desserts at the 14th and U Farmers Market last May, then expanded online. All told, they invested $3,000 to purchase equipment and ingredients.

By the end of 2011, the women set up pickup sites for their online orders, a system modeled after Soupergirl, where Huntsberger used to work part time.

Customers who place orders by Tuesday at midnight can pick them up on Fridays at Weygandt Wines, Mr. Yogato, Miss Pixie’s or The Cupboard. Pies sell for $9 to $19 depending on the size, and can also be purchased through bi-weekly pie subscriptions starting at $72.

Willis left the company in December to focus on her job at the Department of Homeland Security, but Huntsberger continues baking treats out of rented kitchen space at 42 Degrees Catering in Rockville.

© The Washington Post Company


What’s Driving Food Trucks – M&C Report

March 9, 2012

What's Driving

What’s Driving Food Trucks

Four foundational tires and an engine of artisan passion enable the unique mobile food vehicle deliverables.

Food truck mania is sweeping the United States. While it still isn’t fully understood by a great deal of consumers, for those who have incorporated it into their lifestyles, it’s quickly becoming a favorite type of meal solution.

Today’s food trucks are a far cry from the endearingly named “roach coaches” of the past. Historically, the phrase “food truck” brought to mind a less-than-desirable vehicle serving foods and beverages of questionable culinary integrity and flavor.

Now many of these operations are delivering innovative, premium-positioned menu items consumers can’t seem to get enough of.

They are often owned and operated by individuals with very strong passion for the menu items they create. These entrepreneurs bring a lifetime of influences (ethnic, social, cultural and culinary) to the unique and flavorful offerings on these mobile menus. When asked why they started a food truck, many entrepreneurs said they wanted control over their own future and to be able to use and share their skills.

While food trucks are currently receiving the bulk of media attention, there are actually several types of mobile concepts capable of delivering the goods, referred to collectively as mobile food vehicles (MFVs). For our study purposes, we defined a food truck as an enclosed, motorized, moveable vehicle with wheels that sells various foods and beverages; a food trailer as one that has wheels but no engine and must be hitched to another vehicle to be moved; and a food cart as a small open-air vehicle that is generally pushed or pulled by human power.

The foodservice sector has been paying attention to mobile food vehicles. Operators not only recognize them as a competitor, but also as a source of culinary trends they may incorporate into their own menus. Suppliers are becoming interested in aligning with these new players, understanding that it might open the door for future sales and revenue growth for their own organizations.

The MFV landscape varies greatly from city to city. Various municipalities have different ideas on the role these foodservice options should play. And many brick and mortar operators are unhappy with new competition that they view as playing by a different set of rules.

Regardless of the competitive landscape or type of vehicle, Technomic’s field and consumer research has found a structure around MVF success. Artisan passion is the engine that drives the business of delivering craveable and unique food and beverages, supported by four tires: lifestyle integration, community focus, hospitality and a twist on Grandma’s kitchen.

Lifestyle Integration

Technomic’s consumer research reveals that mobile food vehicles are still somewhat unknown. One in five consumers report they are not aware of them or have not seen one. And a third of those individuals who are aware of MFVs have not purchased from one of them.

Additionally, about half of consumers who have used MFVs tend to purchase less than once a month from any specific mobile food vehicle channel, perhaps due to limited availability. This points to a greater need for MVF operators to find ways to integrate into consumers’ lifestyles.

Location and convenience are key consumer purchase drivers, regardless of which type of mobile food vehicle they visited. Serendipity plays a large role as well, as a large percentage of consumers said they just happened to pass by the MFV or it was near an event they were attending.

The operators of the Chef Point Café in Fort Worth, Texas, recognized the value of being where customers are, when they are there. The restaurant wanted to “bring the food to the customer” and collect new fans as well. So it built a mobile truck with a full industrial kitchen inside, created a kitchen of many of the café’s popular items, and parked in a location near a Fort Worth hospital.

Another example of using location to meet customers on their daily travels is the Blue Sky Dining trailer. It offers hot, full family meals that customers can order in advance. The vehicle then parks along a busy highway in the Raleigh-Durham, NC, area that lead hungry commuters home after work.

You might also find MFVs in food trailer parks, which often have indoor seating and bathrooms; near office complexes, college campuses, retail centers and downtown urban areas; at farmers markets, fairs and recreation destinations; and at private catering events from weddings to business conferences.

Community Focus

Mobile food vehicle operators certainly can’t rely on location alone. They depend also on building a fan base, providing a social gathering place and becoming part of the community.

Part of this effort is their much-publicized social media interactions. Along their average day of prepping food in a commissary, setting up their location, serving food, cleaning and restocking, they constantly interact with customers in person on site and via social networking throughout the day.

A social aspect on site is gained via accessible beverage dispensers and coolers, and condiment and toppings bars, which let guests not only customize their dish or drink, but pace their interaction to get quickly back to work or linger and chat with the other customers.

The interactive element takes place virtually as well. Many consumers, especially those under 30, express interest in social networking as a communication tool for MFVs. Only about 7% of consumers actively follow MFVs via social media, mostly using Facebook, but 84% of those who do follow MFVs check in at least once a week. Operators are keen to give these passionate fans a sense of ownership. For example, the Fukuburger truck in Las Vegas wanted to make customers feel like they know the concept intimately, so it posted video tour of the truck on YouTube.

In the future, MVFs will likely increase their customer traffic by generating more grassroots buzz. Currently only 12% of consumers reported they often hear about MFVs from friends or co-workers. But of those who have heard others talk about MFVs, 88% of consumers say they heard positive feedback. So getting these lines of communication open is critical.

Hospitality

Once customers visit an MFV, the operator does what he or she can to bring them back by making them feel comfortable and appreciated.

Many MFVs offer a range of “small touch” items and other considerations to truly provide a complete, high level customer experience. This includes appropriate packaging, which not only presents the brand image, but also preserves product integrity. Packaging can also improve the experience. The Mighty Cone in Austin, TX, serves tortilla-wrapped ingredients in paper cones. The operator also developed wooden holders and attached them to the picnic tables outside the trailer so customers can set down their cone-shaped products between bites.

Consumers have indicated that certain amenities at MFV sites can be important to their overall dining experience. Trash receptacles (66%), seating (25%) and credit-card acceptance (17%) were among those mentioned as important. Other amenities observed during on-site visits included: bathrooms, parking, protection from the elements and ATMs.

To make customers feel welcome, some operators have involved their fans in marketing efforts. At Short Leash Hot Dogs in Phoenix, the Hot Dog of the Week is typically named after a customer’s dog and includes flavor, ingredient and spice profiles representative of the pet’s personality. The owners say this has been a great way to learn more about customers and show appreciation.

A Twist on Grandma’s Kitchen

As at all foodservice establishments, however, it’s all about the food. Where MFVs are concerned, many are seeing success with offering a twist on comfort food, often with an artisanal appeal.

For example, Torched Goodness in Phoenix is owned by a Le Cordon Bleu-trained chef and crème brûlée, a dish consumers are not likely to prepare at home. He showcases skills by melting the sugar in view of customers. In Austin, TX, authentic Asian food like Chicken Pad Thai is prepared using a wok located inside the Coat & Thai food truck. And a custom griddle allows Wafels & Dinges in New York City to prepare its famous Belgian waffles to order as customers watch.

Many operators feel they are expressing individuality through their unique creations, and the result is menu innovation that’s worth watching.

In some cases, operators offer a unique twist on a common item, such as the Pork & Beans sandwich at Chicago’s gastro-wagon, which fills naan with pork, black beans, cilantro, onion and Chihuahua cheese; or Aiko hot dog at Short Leash, topped with mango chutney, diced jalapenos, red onion, cilantro and mayo.

Ethnic influence is evident as well, such as Fukuburger’s Tamago Egg Burger, topped with a fried egg, crispy onion strings, teriyaki and Japanese seasonings; and Los Angeles’ Kogi’s street tacos filled with Korean barbecue.

You’ll also find many operators using local and seasonal ingredients, which also plays to their community focus.

Driving Growth

We are often asked if we see food trucks as a passing fad or an ongoing trend. We asked consumers that question, and fully 91% of those who had heard about mobile food vehicles say they have staying power. Across all dayparts and MFV types, the vast majority of consumers who used MFVs were satisfied with their experience. Based on consumer and operator input, we predict to trend to continue and evolve.

Darren Tristano is Executive Vice President of Technomic Inc., a Chicago-based foodservice consultancy and research firm. Since 1993, he has led the development of Technomic’s Information Services division and directed multiple aspects of the firm’s operations. For more information, visit http://www.technomic.com.

This article came from a print version of M&C Report