Will Novelty Foods Fix the Fast Food Slump?

August 15, 2016

1471036997485By Vera Gibbons
http://www.foxbusiness.com/features/2016/08/15/will-novelty-foods-fix-fast-food-slump.html 

Grilled hot dogs. Mac ‘n Cheetos. Beefy Frito burritos. Chicken rings. Hot dog-crusted pizza. The revival of old cult favorites like clear soda and chicken fries.

And now – the “Whopperrito.”

Yup, this burger/burrito hybrid goes national today following successful test debuts in Ohio, Pennsylvania and Texas.

What gives? Why are the fast food chains putting so many weird – if not repulsive – food gimmicks on their menus? “It’s about generating traffic,” says Darren Tristano, president of Technomic Inc., a food service research firm.

There’s been a pullback in the industry, you see. A slump. And everyone’s feeling it – from Shake Shack (SHAK) to Starbucks (SBUX) to McDonald’s (MCD).

“Things were going really well at the start of the year when all the economic indicators that would correlate to positive restaurant conditions were in a good place – gas prices were low, confidence was up, housing was settled – and then in April, the switch turned off even though the indicators were still in place.”

Why? Tristano says there isn’t one specific reason for the softness. “People are buying food from other places – supermarkets, convenience stores; they’re eating at home more; and then there’s the presidential election, which could be a trigger point. It’s really the most tangible explanation anyone can point to—political uncertainty.”

Regardless, consumers – especially those looking ahead and thinking about college obligations and other expenses – are watching their wallets, says economist, Arjun Chakravarti, Assistant Professor of Management and Marketing at the Stuart School of Business.

While the younger set (The 25-year old group without 401ks and exposure to the global markets) is more optimistic about the economy and therefore more inclined to spend (especially in light of slightly rising wages and lower gas prices), says Chakravarti, the reality is that purse strings are pretty tight right now. And they’re not expected to loosen them anytime soon.

In fact, restaurant sales, virtually flat, are expected to remain weak for the rest of the year, according to The NPD Group, an industry research firm.

Is this a warning sign for the economy? “A downturn in restaurant sales increases the likelihood of a recession, but the hope is that it’s counteracted/buffered by expectations for increases in business spending in the 3rd quarter,” says Chakravarti.

Fast food chains aren’t taking any chances. They’re responding by offering aggressive discounts that emphasize affordability, and unleashing innovative, zany mash-ups that are more profitable (Burger King’s “Whopperrito” will sell for $2.99; $4.99 when wrapped into a combo meal.).

Buzz marketing – a viral marketing technique that is focused on maximizing word-of-mouth potential largely on social media platforms – is the name of the game, says Dan Rene, senior vice president at LEVICK, A strategic communications firm. “Fast food chains are engaging customers by selling them an ‘experience’ and this is an ‘experience’ that customers want to be part of, and share—pictures, posts, you name it.”

“It doesn’t matter whether or not customers like the food or what it tastes like. If everyone’s talking about it and the hype results in more foot traffic for the fast food chain, it’s won.”


Leading Culinary Predictions & Trends 2016: What’s in the Hunt?

August 4, 2016

Morrocan.jpg

By Barbara L. Vergetis Lundin, Assistant Editor
http://www.foodabletv.com/blog/leading-culinary-predictions-and-trends-2016-whats-in-the-hunt

A survey of chefs conducted by the National Restaurant Association predicted 20 trends for 2016. The chefs are obviously on top of their game, as all of the trends have come to fruition in some form or fashion. Which ones are in the hunt?

“True trends evolve over time, especially when it comes to lifestyle-based choices that extend into other areas of our everyday life,” said Hudson Riehle, senior vice president of research for the National Restaurant Association, in a statement. “Chefs and restaurateurs are in tune with over-arching consumer trends when it comes to menu planning, but add their own twist of culinary creativity to drive those trends in new directions. No one has a better view into the window of the future of food trends than the culinary professionals who lead our industry.”

Some of the predictions are “fully inundating top restaurant chains,” according to Darren Tristano, president of Technomic, a Winsight Company.

Farthest along are natural ingredients, ethnic condiments/spices, authentic ethnic (think Middle Eastern and African spices like sumac and dukkah), ancient grains, ethnic-inspired breakfast items like coconut milk pancakes, and street foods, as a multitude of top chains are embracing these trends in one way or another, he said.

“In my opinion, the two biggest headliners of this year have been natural ingredients and ethnic condiments/spices,” Tristano said. “They’re showing up in all restaurant segments and cuisine types in so many different ways.”

Natural Ingredients

When it comes to using natural ingredients, Panera is setting a high standard. Not only does Panera stress clean ingredients, but the chain has a “no-no” list of ingredients that they have committed to removing from their food by the end of 2016, including artificial flavors and colors; artificial sweeteners like aspartame; partially hydrogenated oils and artificial trans fat; fat substitutes like sucrose polyester and micro-particulated whey protein concentrate; lard; high fructose corn syrup; sucralose; maltodextrin; added nitrates, nitrites, and sulfites; and added caffeine.

California Pizza Kitchen (CPK) recently announced its intention to use more local, natural ingredients. For example, it will source vegetables like lettuce, kale, and arugula from local and regional farms whenever possible. Not only are the ingredients being used this summer at California Pizza Kitchen natural, they are simple – as evidenced by new seasonal dishes like California fields salad (with fresh field greens and baby kale, strawberries, watermelon, basil, California pistachios, feta, and champagne vinaigrette), strawberry shortcake featuring house-made candied lemon zest, strawberry lime margaritas, and strawberry mango coolers.

“It’s been a long, cold winter for many and we are happy to welcome the warmer weather by offering a taste of the season’s freshest ingredients throughout our menu,” said Brian Sullivan, senior vice president of Culinary Development for California Pizza Kitchen, said in a statement. “Tender, leafy greens are a key component to many of our dishes and we’re also giving fresh strawberries special emphasis this season…We love summer at California Pizza Kitchen when some of our favorite produce, like sweet strawberries and watermelon, are at their freshest and juiciest.”

Even McDonald’s has jumped on the natural ingredient bandwagon with a new line of summer salads that are moving from traditional iceberg lettuce to red leaf lettuce, romaine, baby spinach, and baby kale peppered with vibrantly colored vegetables.

McDonald’s culinary and supply chain teams have even traveled to some of the chain’s lettuce suppliers, learning, right in the field, how the leaves are harvested and how suppliers maintain consistent growing techniques.

Further, McDonald’s has committed to fully transition to cage-free eggs over the next 10 years. Annually, McDonald’s purchases approximately two billion eggs in the U.S. and 120 million eggs in Canada.

Ethnic Condiments and Spices

American consumers are seemingly pretty adventurous when it comes to food. In fact, 80 percent of those consumers surveyed by the National Restaurant Association in 2015 consume at least one ethnic cuisine per month; 17 percent eat seven or more monthly.

Further, two-thirds are trying a wider variety of ethnic cuisine than they were five years ago, according to NRA research. Restaurants were found to be the main way consumers get access to ethnic food.

“Americans generally are more willing to try new food than they were only a decade or so ago – especially in restaurants – underscoring that the typical consumer today is becoming more adventurous and sophisticated when it comes to different cuisines and flavors,” said Annika Stensson, director of Research Communications for the National Restaurant Association, in a statement. “Ethnic cuisines are a long-term trend on restaurant menus, with some being so common that they’re hardly considered ethnic anymore, while others are still relatively unknown. However, our research shows that consumers are exploring a range of international dishes these days.”

The research revealed that, not surprisingly, Italian, Mexican, and Chinese are the most familiar, while consumers are least familiar with Ethiopian, Brazilian/Argentinian and Korean cuisines. However, condiments and spices with these origins are popping up on familiar menus.

Lizzy Freier, menu analysis managing editor with Technomic has been tracking the up and coming trends in spices and has found that berbere (a staple spice mixture in Ethiopian cooking) and other African influences are making their way onto North American menus. In particular, True Food Kitchen serves a Moroccan Chicken with chickpea, olive, spinach, and chermoula (a North African marinade); BLT Steak features a rack of lamb with a spicy North African merguez sausage; Veggie Grill has unveiled a super green salad featuring hummus and harissa (Tunisian hot chili pepper paste); and Modern Market’s eggplant goat sandwich offers a spicy helping of harissa tahini.

Nando’s chicken chain has made peri peri (also called piri piri) famous, if not infamous. The Portuguese seasoning, which is prevalent in South Africa, contains crushed chiles, citrus peel, pepper, salt, onion, lemon juice, basil, oregano, tarragon, lemon juice, pimento, paprika, and bay leaves (although Nando’s recipe is a secret). A chain similar to Nando’s, albeit much smaller, Boneheads Grilled Fish & Piri Piri Chicken also capitalizes on the South Africa influence.

Noodles & Company has incorporated a similar, more exotic version of sriracha into its menu. Called gochujang, it plays heavily in the fast-casual restaurant’s new dish Korean BBQ meatballs with gochujang sauce – making Noodles & Co. the first national restaurant chain to feature gochujang on its menu. Sriracha is also a popular condiment at Noodles & Company, as well as other chains like Subway.

Ghost peppers, the world’s spiciest pepper, are a hot menu item, as evidenced by Wendy’s ghost pepper fries and Quaker Steak & Lube’s dusted ghost pepper flavor which is available for a limited time as a wing sauce.

Brazilian-influenced brands include Texas de Brazil Churrascaria, Fogo de Chao, and Tucanos Brazilian Grill. Plus, these kinds of ethnic influences are also appearing on non-ethnic restaurant menus. For example, Yogurtland offered a limited-time Argentinian Dulce de Leche Cookie frozen yogurt flavor at the end of April.

Argentinian Chimichurri sauce has been popular at national brands, particularly paired with shrimp (Taco John’s, Fuzzy’s Taco Shop, and Red Lobster).

Early Stage Trends and Laggards

On the opposite end of the spectrum, many trends – like hyper-local sourcing, artisan ice cream and butchery, and house-made sausages – are in their early stages, appearing in mostly independent restaurants.

“[These trends] are really tough for large restaurant chains to do on a national level…because it’s expensive and equipment can be tough to source,” Tristano said.

Some of these trends do well in non-commercial as opposed to commercial.

“Hyper-local sourcing and food waste reduction/management are both well-developed at college and university foodservice,” said Tristano. “Applying these to the mainstream could be tougher, though some chains like Sweetgreen and Shake Shack have approached trends like food waste in interesting ways by repurposing food scraps.”

For example, for a limited time, Sweetgreen and Shake Shack featured a burger created by Chef Dan Barber (the wastED juice pulp cheeseburger), which used leftover vegetable pulp, leftover cheese trimming, and bruised beets for ketchup, atop a repurposed bun made from stale rye bread.

While other trends, are making progress, it has been significantly limited. For example, chains like True Food Kitchen and Top 500 chain Sweetgreen feature sustainable sea bass and sustainably farmed trout, respectively, but many other large chains aren’t quite there yet.

While pickling has been a huge trend in recent years, even making it onto menus like Red Robin which recently unveiled a Battered Broccoli with house-made pickled jalapeno aioli, there hasn’t been a significant surge on other top menus.


Eatery digests patrons’ feedback

June 6, 2016

Arkansas-based fast-casual restaurant chain Slim Chickens, known for its tenders and wings, is rolling out a chicken-breast sandwich for taste-testing.

Testing is underway at Slim Chickens’ three Fayetteville locations, its Rogers store, and in Broken Arrow, Okla., near Tulsa. The restaurant chain is offering cayenne ranch and buffalo chicken sandwiches in Northwest Arkansas and cayenne ranch and Cajun chicken versions of the sandwich in Oklahoma.

Customers who select the sandwich are asked for feedback in a survey that takes about a minute to complete. That information goes straight to a few select Slim Chicken executives. So far, customers’ feedback has already resulted in changes to one of the sandwiches. The process is expected to continue for the next several weeks.

“Early indicators are positive,” said Sam Rothschild, Slim Chickens’ chief operations officer. “This is why you test.”

While the chain has offered sandwiches in the past, this is the first one made with a whole, premium chicken breast. Rothschild described the test sandwiches as being made from high-quality chicken and “fully dressed” with Slim’s sauce, pickles, lettuce and onions.

“We want our sandwich to stand out,” he said.

Slim Chickens has 35 restaurants — 25 are company owned and 15 are franchise operations — in Arkansas, Texas, Oklahoma, Illinois, Nebraska, Kansas, Louisiana, Missouri and Tennessee, with 21 other stores under construction. With the new stores, Slim’s is expected to have more than 50 restaurants open by the end of the year. The company said it hopes to have 600 stores in the United States by 2024.

Slim Chickens competes in the fast-casual segment, where operations focus on an enhanced dining experience compared with fast-food operations. While they don’t have a wait staff, fast-casual restaurants typically deliver patrons their food after ordering.

According to information provided by Chicago-based Technomic Inc., a research and consulting firm focusing on food and food service, sales at limited-service chains among the top 500 U.S. restaurant chains grew 5.5 percent to $211 billion in 2015. Sales at limited service chicken restaurants was up 9 percent. Limited service chains include fast food and fast-casual concepts.

Sales in the fast-casual segment alone were up 11.5 percent, and unit growth was up 9.6 percent in 2015, according to the report.

Darren Tristano, president of Technomic, said that portability, in the form of a sandwich, is something that consumers are looking for, and that adding a sandwich helps fast-casual operations compete with more traditional fast food’s convenience factor.

“One hand on the wheel and the other on a sandwich,” he said.

He added that Slim Chickens’ efforts to test the sandwiches locally are wise.

“They are getting consumers to validate the quality of the product,” he said. “It’s what successful brands do but not what everybody does.”

Rothschild said the sandwich sells for $3.99 by itself or as part of a combo meal at $6.49. Slim Chickens’ lowest cost combo meal, pre-sandwiches, was $6.99. He said that puts the Slim Chickens’ sandwich and combo meal close to fast food on price.

“We want people to come to us when they want chicken,” Rothschild said.


McDonald’s All-Day Breakfast Sparks a Fast Food Fight

May 9, 2016

by Leslie Patton

http://www.bloomberg.com/news/articles/2016-05-03/mcdonald-s-breakfast-push-sets-off-morning-scramble-in-fast-food

Fast-food joints aren’t hitting the snooze button anymore.

McDonald’s Corp.’s decision to start selling Egg McMuffins all day long last year — meant to help sales during lunch and dinner time — has boosted its morning business as well. That, in turn, has kicked off a scramble among its rivals to find new ways to combine eggs, potatoes and meat for a tasty breakfast.

The latest example is Burger King’s Egg-Normous breakfast burrito, which is being introduced in the U.S. on Tuesday. It’s stuffed with sausage, bacon, eggs, hash browns, cheddar and American cheese and served with picante sauce. The home of the Whopper, which still serves breakfast only during morning hours, also recently added a supreme breakfast hoagie and got rid of slower-selling English muffin sandwiches.

“We’ve invested more in breakfast,” Alex Macedo, head of Burger King North America, said in an interview. “The environment is very competitive.”

Along with adding and deleting items, Burger King tweaked its smaller egg burrito earlier this year, removing green and red peppers and replacing them with hash browns.

Skillet Bowls

Taco Bell revised its morning offerings in March to include $1 options such as skillet bowls and sausage flatbread quesadillas. Subway Restaurants just announced buy-one-get-one subs for the month of May. The catch: They have to be purchased before 9 a.m. And Dunkin’ Donuts revamped its menu boards to focus on all-day choices and started advertising $1.99 Coolatta drinks that are sold at all hours.

The changes come as more U.S. consumers grab eggs and coffee outside the home, according to a study by researcher GfK MRI published by EMarketer.com. Last year, more than 34 percent of Americans reported buying breakfast at fast-food restaurants, an increase from 32.8 percent in 2011. Meanwhile, fewer consumers said they’re dining out for lunch and snacks. Dinner increased less than 1 percent.

McDonald’s all-day breakfast in the U.S. has helped turn around its worst sales slump in more than a decade by drawing more customers throughout the day, including the morning. The plan is surpassing its goals.

Exceeding Expectations

“It’s still exceeding our expectations,” Chief Executive Officer Steve Easterbrook said on a conference call in April. “Whilst we clearly added incremental visits and incremental spend across rest of day, our breakfast business has also prospered.”

Items like Egg McMuffins and hash browns fueled a 5.4 percent U.S. same-store sales increase at McDonald’s in the first quarter. That’s stronger than the most recent quarterly gains posted by Burger King, Dunkin’ and Taco Bell.

“It’s helped drive success, which they haven’t seen for several years,” said Darren Tristano, president of industry researcher Technomic Inc.

After losing customers to McDonald’s all-day Egg McMuffins, Jack in the Box Inc. has been advertising a triple-cheese and hash-brown breakfast burrito. Same-store sales at company-owned Jack in the Box locations may be down as much as 3 percent in the recently ended quarter, the company said in Februar-1x-1y. The chain also is adjusting and improving other breakfast items, CEO Lenny Comma said during a conference in March.

Dunkin’ Donuts said last month that its new menu boards are helping drive breakfast-sandwich sales. It’s also focused on introducing mobile ordering and will start a 1,650-store test in metro New York in May to get customers their morning meals even faster. CEO Nigel Travis says McDonald’s push has actually helped Dunkin’ in the breakfast battle by highlighting that the doughnut chain has the same menu all day. Still, the change has increased competition for diners’ dollars.

“Clearly, the value war is pretty intense,” Travis said in an interview.


10 Nuggets For $1.49? Here’s Why Fast Food Is Ridiculously Cheap Right Now

April 1, 2016

Venessa Wong
Buzzfeed News
Feb 29, 2016
http://www.buzzfeed.com/venessawong/why-fast-food-is-ridiculously-cheap-right-now#.gnYqPoN15

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The country’s largest fast food chains have been showering customers with deals after years of losing out to newer, higher-end chains. And now, in a battle for customers who remain loyal to old-school fast food, the big chains are engaged in a brutal price war.
Fast food companies have always targeted lower-income consumers. What’s different now is that these customers are expected to benefit from lower gas prices, falling unemployment, and rising minimum wages, according to research by investment bank Cowen and Company. And as low-income consumers find more money in their wallets, commodity prices are no longer shooting upward as they did in recent years.
As “forecasts for key restaurant commodities including beef, chicken, pork, dairy and wheat are in-line to below long term averages,” restaurants are particularly eager now to take advantage of the lower costs to boost traffic to stores, said Cowen’s report.
McDonald’s announced that starting Feb. 29, customers could pick two of four “iconic menu items” — a Big Mac, a 10-piece order of Chicken McNuggets, Filet-O-Fish or a Quarter Pounder with Cheese — for $5. This deal replaces the even lower-priced McPick 2 deal launched in January, in which customers could get two items — McChicken, McDouble, mozzarella sticks, or small french fries — for $2.
Meanwhile, Wendy’s has been offering a four for $4 deal. Value monger Burger King has an even cheaper five for $4 promotion, as well as an ongoing two for $5 sandwich deal, and 10 chicken nuggets for $1.49. Even Pizza Hut has a $5 “flavor menu.”
“All the major chains have jumped on the dollar pricing in an effort to maintain share against competitors,” said Darren Tristano, president at restaurant consultancy Technomic.


The remarkable rise of the sushi burrito

March 7, 2016

By Becky Krystal
The Washington Post
March 4th, 2016
https://www.washingtonpost.com/news/going-out-guide/wp/2016/03/04/the-remarkable-rise-of-the-sushi-burrito/

Korrito

Has your sushi been a bit different lately? Maybe longer, pudgier and rolled up with rice, protein and vegetables? You know, kind of like a burrito?

Actually, let’s call a spade a spade. Your sushi isn’t just like a burrito. At an increasing number of eateries, it is, in fact, a burrito. The sushi burrito has officially joined the ranks of such culinary chimeras as the Cronut and the ramen burger, seducing both eager customers and the restaurateurs who want to feed them.

Even as diners eat fewer Chipotle burritos, sushi burritos are gaining traction around the country and in the Washington area. The latest purveyor joined the D.C. scene last week: Seoulspice in NoMa, which sells what it calls the Korrito, a Korean-style burrito wrapped in seaweed and filled with sushi-grade rice, plus a variety of meats, vegetables and sauces.

Eric Shin, a percussionist for the National Symphony Orchestra, said he hit upon the burrito concept almost by accident about two years ago. He’d originally planned to offer kimbap, Korean rolls sliced into bite-sized pieces. Unfortunately — or perhaps fortunately — the machine he bought to cut them destroyed the food. “It was a huge mess,” he said. Amid the disappointment, Shin’s wife was so hungry she just picked up an uncut roll and started eating it like a burrito.

“It just sort of stuck,” Shin said.

Darren Tristano would tell you that the popularity of the sushi burrito is no accident. The president of Technomic, a Chicago-based firm that specializes in food industry analysis, said a number of factors are at play. Primary among them is the form itself. Four years ago, a Technomic concept study predicted “burrito-inspired” would be a common industry trend. Good call.

Sushi burritos have also been propelled by the growth in fast-casual dining and its build-your-own mentality, Tristano said. And with sushi available at almost every grocery store these days, it’s become an accessible and familiar food.

Like so many food innovations, sushi burritos gained traction on the West Coast and are continuing their march across the country. Sushirrito, a five-location California chain that bills itself as “the original sushi burrito concept” debuted in San Francisco in 2011, the same year the Jogasaki food truck hit the streets of Los Angeles; the Kome truck peddles sushi burritos in San Francisco.

“The concept for Sushirrito came to be since we love sushi and wanted it to be more accessible and portable. Burrito-sizing sushi makes a lot of sense given the handheld aspect of it,” said Sushirrito founder Peter Yen. “We weren’t trying to start a trend. We simply wanted to create a new type of food that we like to eat. Hybrid foods only make sense when the foods belong together — just because you can do a mash-up, doesn’t mean you should.”

Even given the wave of sushi burritos in California, lifelong friends and first-time restaurateurs Mike Haddad and Travis Elton weren’t quite sure what to expect when they debuted Buredo in downtown D.C. last summer.

[There’s no way we couldn’t try Buredo’s burrito-size sushi rolls]

“We didn’t know how it would be perceived,” Haddad said. When the doors opened and curious diners snaked down the block, “I said, ‘I think we have something here.'” Something big enough that the duo is close to opening a second location, near Dupont Circle.

Haddad and Elton think they’ve hit on customers’ interest in food that is fresh and healthful.

Darren Norris knows he’s tapped into that market at his almost year-old Maki Shop on 14th Street NW, where evenings will see diners trickling in from CrossFit and other nearby gyms. The owner of the late Kushi in Mount Vernon Triangle — whose six-ounce maki fall somewhere between the size of smaller sushi and sushi burritos — said his “sushi hand rolls” are “a lifestlye product” for on-the-go diners. “I want to be that thing that you could eat three days a week and not feel guilty about it,” Norris said.

Kaz Okochi, the proprietor of Kaz Sushi Bistro near Foggy Bottom, said he thinks size is what attracts people to sushi burritos — “too much rice,” he opined — and worries that diners who eat them will come to his restaurant and wonder why his food isn’t bigger. “They might get disappointed,” the Japanese native said. (Okochi’s own fast-casual, design-your-own sushi endeavor, Oh Fish!, lasted about two years downtown.)

Their size and torpedo shape notwithstanding, sushi burritos have forced us to reconsider what we think of as sushi, especially when it comes to fillings. At Buredo, nori is wrapped around everything from yellowfin tuna or salmon sashimi to tofu and pulled pork shoulder. Seoulspice’s Korean-accented items include bulgogi beef, pickled radish and, of course, kimchi. At Burrito San in Miami, you can have your sushi burrito by way of the Philippines (braised pork, banana ketchup) or India (spiced chicken, potatoes, curry). Denver’s Komotodo not only sells rolls such as the Bee’s Knees (fried chicken, asparagus, bacon, Monterey Jack cheese) and Fish n’ Chips (white fish, slaw, potato chips), but also gives you the $2 option to have your burrito deep-fried. Really, the question these days is not what can you put in a sushi burrito, but what can’t you?

Okochi, though, doesn’t take umbrage with the burrito entrepreneurs’ use of the word “sushi.”

“I’m not saying burrito sushi isn’t true sushi. Sushi is vinegared rice,” he said. Sticklers could even contest whether Okochi’s food is “true” sushi, since the chef said he’s developed his own style at his restaurant.

As long as sushi burritos don’t take over the entire sushi market, he’s fine living side-by-side with them, he said.

In fact, self-professed sushi lovers Haddad and Elton view themselves as “introducing sushi to a new audience,” Elton said.

“It is definitely opening up people’s minds,” Haddad said.

Seoulspice’s Shin said he’d like his Korritos to similarly encourage diners to seek out the kind of traditional Korean food he grew up eating.

Even with more people like Haddad, Elton and Shin getting in on the sushi burrito game, Technomic’s Tristano said there’s still room to grow in the genre. He said reasons why sushi burrito establishments are still less common than their popularity might indicate include food safety issues with sourcing and serving raw fish (although many burritos rely on cooked, fried or even vegetarian fillings) and the fact that the concept is hard to replicate.

“A good sushi burrito can be tricky and sometimes challenging to get the flavors to blend together well in a larger roll,” said Mauricio Fraga-Rosenfeld of Rolls by U in Arlington, which opened in the fall with sushi “ritos” such as the Frida (with roast beef and kimchi) and the Van Gogh (a more traditional pairing of tuna and avocado). “Also, price point may play a part in why others don’t want to risk it. It’s cheaper to do tacos or Mexican burritos. It takes creativity and great quality in product and recipe to get it right, as well as extremely fresh ingredients.”

“I think it’s really difficult to pull off,” Shin said. “Most of the restaurants that open up are afraid to do something different.” Shin said he had to battle through questions and skepticism from his own family (his parents ran a Korean restaurant in Atlanta), some of whose recipes he’s using at Seoulspice. “I caught a lot of s— from my grandma,” he laughed.

When other sushi burrito spots do inevitably open, Shin won’t be too worried. “The more, the merrier,” he said. “I’m so proud of D.C. for embracing ethnic foods and creative ethnic foods in general.”

The Buredo duo was slightly more measured.

“Time,” Haddad said, “will tell on who will last.”

Correction: A previous version of this story misidentified the geographical origins of Jogasaki and the Kome truck. This version has been updated.


Is Chipotle really America’s ’emotionally abusive boyfriend?’

February 25, 2016

Grace E. Cutler
FoxNews.com
February 18, 2016
http://www.foxnews.com/leisure/2016/02/18/chipotle-survival-part-joke/

 

Chipotle has been the brunt of jokes and hit by lawsuits, but some experts are predicting positive growth figures as early as the end of the year. (AP)

Chipotle has been the brunt of jokes and hit by lawsuits, but some experts are predicting positive growth figures as early as the end of the year. (AP)

On Sunday, TV host and comedian John Oliver skewered Chipotle over its food safety problems.

The host of HBO’s “Last Week Tonight,” called Chipotle “America’s preferred over-the-counter laxative.”

He ran down a list of Chipotle’s problems over the past months, including E. Coli, salmonella and norovirus outbreaks. He also had a mock promo showing mice scurrying over food and cited a fake report about a live bird living in a Florida Chipotle as recently as January.

About America’s continued love of the chain, Oliver quips:

“They know it’s bad and they want it even more: Chipotle is now officially America’s emotionally abusive boyfriend.”

“That’s harsh,” Darren Tristano, president of Technomic, a Chicago-based food research firm said about Oliver’s comment. “They shouldn’t be left off the hook, but they deserve the chance to really get back on track.”

Over the weeks, Chipotle has been the target of jokes and critics alike –and rightly so.

The Food and Drug Administration reports 55 people were infected with E. Coli alone across the U.S., which resulted in 21 reported hospitalizations. The chain is now the focus of a criminal investigation by the FDA and it has been slapped with a slew of lawsuits. The latest one –this week–is from a shareholder suing Chipotle, alleging the fast food chain made false and misleading statements about its business to investors.

Chipotle isn’t the only food supplier to have a major outbreak of food-poisoning. In the 1993, Jack in the Box had an E.Coli crisis stemming from undercooked beef patties. More recently, Blue Bell ice cream experienced a listeria outbreak, which forced the tubs off of store shelves. Both companies were able to fix their problems and turn their image around.

But Chipotle’s marketing has centered on the idea that it makes a high quality food. These outbreaks, and Chipotle’s problems in tracing the source, puts that question.

As way help its tarnished image, Chipotle earlier this month closed more than 2,000 locations to get employees up to speed on changes to its food safety measures. It also announced a $10 million investment in local farmers that supply ingredients to the food company. To help build some media buzz around these efforts, chains gave away free burritos.

The give-away was “clearly part of a much larger plan to rebuild trust with the customers,” Bruce Hennes, managing partner of Hennes Communications, a crisis communications firm based in Cleveland, told the Cleveland Plain Dealer.

Just how long it will take for the company turn around public opinion is still unclear, but some experts are predicting positive growth figures as early as the end of the year.

Is that’s hard to believe? Tristano says not really, given the “overwhelming” loyalty they have with some customer groups, especially the 18-35 male demographic.

“Our research indicates that American consumers are very forgiving with restaurant brands they are loyal to and have developed both an affinity and frequency with,” said Tristano.

So is Chipotle America’s “emotionally abusive boyfriend?” Sounds like for some, it’s more like a relationship on the mend.


Fazoli’s closes only Las Vegas restaurant

February 24, 2016
Jennifer Robison
Las Vegas Review-Journal
February 17, 2016
http://www.reviewjournal.com/business/fazolis-closes-only-las-vegas-restaurant

1004922526_fazolis_021716_3.jpgThere’ll be no more free breadsticks on North Town Center Drive.

Italian fast-food franchise Fazoli’s has quietly closed its lone Las Vegas eatery. The restaurant, behind the 7-Eleven at Town Center and Covington Cross in Summerlin, shut Feb. 8, 15 years to the day after its 2001 debut.

The closure defies broader market trends, as big, national chains including Chick-fil-A and Cracker Barrel prepare market launches for late 2016 and early 2017.

“Las Vegas is definitely a growth market,” said Darren Tristano, president of Chicago-based restaurant consultant Technomic.

So why did operators shutter Fazoli’s?

Company spokeswoman Janet Ritter deferred to the franchisee, Las Vegas-based Glencoe Management, and Glencoe Management didn’t return phone calls. The company’s website said it owns 21 local Burger Kings, including one at 1280 Town Center Drive, next to the former Fazoli’s.

But Ritter said Fazoli’s, a Kentucky chain with 217 U.S. locations mostly in the Midwest and South, “would like to have a presence in Las Vegas, and we are seeking franchisees to open units in the Las Vegas area.”

The Fazoli’s closure capped a market foray that never really picked up steam.

Ritter said she had no information on number or dates of operation of prior local stores, but at least two other Fazoli’s franchises — one on Ft. Apache Road near Rhodes Ranch and another on Eastern Avenue in Silverado Ranch — opened after 2001 and closed years ago.

The 28-year-old company had as many as 300 U.S. restaurants before it began pruning locations in the recession. Each restaurant typically employs 30 to 40 people, Ritter said.

Competition has hurt Fazoli’s, Tristano said.

The U.S. market is saturated with chains, including Panera Bread and Noodles & Co., that serve pasta and pizza. Plus, Fazoli’s straddles a blurry line between fast food and the more upscale fast-casual segment, which includes operators such as Chipotle and Au Bon Pain.

“That’s not a terrible place to be. The problem is, you’re lumped in to some extent with fast food because of the drive-thru and the price points, but the quality is not at the level of a fast-casual restaurant,” Tristano said. “That’s not to say it’s not good quality, but there are so many concepts with customized, prepared-to-order food.”

It didn’t help that Fazoli’s had just a handful of local stores. A franchise needs 20 to 25 locations in a big market to build loyalty and brand awareness, Tristano said.

Still, Fazoli’s seems to have righted its ship: The company said in December that same-store sales were up in 65 of the prior 68 months, including a 3.1 percent jump year over year in November. It opened 10 new franchises in 2014 and 2015.

And restaurant operators continue to salivate over the Southern Nevada market, Tristano said.

“Las Vegas has the demographics and growth that many chain brands are looking for,” he said. “Not all of the markets in the United States are growing, but you’re seeing housing development and population growth there, and that’s a big deal. Chains tend to be prioritizing growth markets.”


Fast-food chains are gaining muscle again

February 23, 2016
JONATHAN BERR
MONEYWATCH
February 17, 2016
http://www.cbsnews.com/news/fast-food-chains-mcdonalds-burger-king-wendys-gaining-muscle-again/

McDonald’s (MCD), Burger King and Wendy’s (WEN), which have struggled in recent years, are now dishing up some appetizing operating results.

Same-store sales, a key metric of sales at locations open a year or more, have been on an upswing for the big chains recently. For instance, that figure has risen 5.7 percent at McDonald’s over the past 13 months, by 3.9 percent at Burger King over the 2015’s last quarter and by 4.8 percent for Wendy’s in the same period.

According to Darren Tristano, president of restaurant consulting firm Technomic, consumers are spending more at the chains, thanks to lower gas prices and an improving job market. The companies are also selling their food more aggressively to budget-conscious diners, a key demographic for the industry.

“With so much advertising shifted toward value play, $4 for 4, $2 for 2, etc … low prices are driving consumers toward convenience, value and comfort food,” he said, adding that renovations at the chains have also paid off. “Locations are becoming more appealing to consumers, who have viewed these restaurants as old and outdated.”

Burger King parent Restaurant Brands International (QSR) benefited from remodeling the burger restaurants and the expansion of the Tim Horton’s donut shop chain, which it also now owns. During yesterday’s earnings conference call, the company said U.S. franchisee profitability rose by more than 30 percent over last year, which CEO Daniel Schwartz called a “tremendous accomplishment.” Franchisees, who are independent business operators, own many fast-food restaurants.

Restaurant Brands has high hopes for an American classic: Grilled hot dogs, which Burger King is rolling out at more than 7,000 U.S. locations later this month. It may be chain’s largest new product launch since the 1970s.

“I personally visited the test market to confirm that the Grilled Dogs could be an operationally simple but pretty impactful product,” Schwartz said during the conference call. “And we’re all excited about it.”

Restaurant Brands was created in 2014 after the $11 billion acquisition of Tim Horton’s by Burger King Worldwide, which is controlled by Brazil’s 3G Capital. The transaction, called an inversion, lowered the company’s tax bill because it relocated to Canada, and it remains controversial.

Restaurant Brands on Tuesday reported better-than-expected profit, excluding one-time items, of 35 cents per share on revenue of $1.06 billion. Same-store sales rose by 6.3 percent at Tim Horton’s.

Wall Street, though, remains skeptical. Shares of Restaurant Brands have slumped more than 18 percent over the past year, underperforming McDonald’s, which gained more than 23 percent during that same time amid investors’ enthusiasm of a potential turnaround at the Home of the Golden Arches.

Morningstar analyst R.J. Hottovy, however, argued in a recent note that investors were overlooking Restaurant Brands’ potential for growth.

“While McDonald’s turnaround may have generated the most quick-service-restaurant headlines the past several months … Restaurant Brands International continues to fly under the radar with effective menu strategies, new franchise partnerships across the globe and exceptional cost discipline,” he wrote.

Earlier this year, McDonald’s reported its strongest quarterly earnings in nearly four years as consumers responded to the chain’s decision to offer breakfast all day. Wendy’s results beat Wall Street’s analysts’ expectations, and the chain forecast better-than-expected sales at existing locations in 2016.

Other fast food chains are also doing well.

Yum Brands (YUM), the parent of Taco Bell and KFC, recently reported better-than-expected quarterly profit, though revenue growth was hurt by the sluggish performance at Pizza Hut.

Popeyes Louisiana Kitchen (PLKI) announced in January that it expected 2015 per-share earnings to be better than it had previously forecast. It plans to release results on Feb. 23.

If the industry keeps this momentum going, investors may soon start ordering more fast-food shares.


Shrinking sales pushing Bonefish Grill chain to close 14 restaurants, restructure

February 22, 2016
Justine Griffin, Times Staff Writer
Tampa Bay Times
Wednesday, February 17, 2016 11:12am
http://www.tampabay.com/news/business/retail/bonefish-grill-to-close-14-restaurants-and-restructure/2265710

Times files
Bonefish Grille on North Dale Mabry Highway.Bonefish Grill will close 14 restaurants this year as the seafood chain restructures following several quarters of disappointing sales results.

Tampa-based Bloomin’ Brands, the parent company of Bonefish Grill, Outback Steakhouse, Carrabba’s Italian Grill and Fleming’s Prime Steakhouse & Wine Bar, announced Wednesday that it expects the 14 Bonefish Grill locations to close within the year. Bloomin’ took a pre-tax charge of $24.2 million during the fourth quarter of 2015 in connection with the closures. No specific stores were named.

“We needed to strip out the complexity that had impacted the core service at Bonefish and focus on what wasn’t broken,” said Bloomin’ Brands CEO, Liz Smith, during an earnings call Wednesday. “We’ve done that. It’s important to look beyond quarter to quarter. We expect 2016 to be a strengthening and momentum story for Bonefish Grill as we move through the year.”

Sales were down at Bonefish Grill by 5.4 percent for the months of October through December as compared to same period in 2014. Sales for the quarter were down a combined 2.8 percent at all Bloomin’ restaurant brands in the U.S.

Bonefish Grill, which was intended to be the leading brand for new growth in Bloomin’ Brands’ restaurant portfolio last year, saw the steepest declines. This is the third quarter of decline for the chain, which is in a competitive class of “polished casual” chain restaurants, and tends to be more pricey than dining experiences like a TGI Fridays or Olive Garden. The menu quality is similar to restaurants like Seasons 52 or Carmel Cafe.

But Bonefish’s biggest competitors are independent restaurants, said Malcolm Knapp, a restaurant economist in New York City and the founder of Knapp-Track, an industry tool used to track restaurant sales.

“Bonefish is in a good spot where they can appeal to a higher demographic because the food quality is good,” Knapp said. “But independent restaurants are getting bigger and there are a lot of really great chef-driven places out there. With the shrinking size of the middle class, restaurants are seeing less frequency from consumers, who have a lot more choices.”

An “anti-chain” movement from a younger demographic has changed the way consumers are spending their money and hurt chain restaurants like Bonefish. Millennials and generation X-ers are looking for value but often opt to try a locally owned restaurant rather than a chain.

“This is a symptom of a bigger issue,” said Darren Tristano, president of Technomic, a Chicago-based food research firm. “Fast food and fast casual concepts continue to do well but casual dining is staying stagnant. It doesn’t help that Bonefish is a seafood restaurant, which has its ups and downs and isn’t as broadly appealing as steaks or Italian.”

Nevertheless, Knapp believes Bloomin’ is taking the right steps to get Bonefish Grill back on track this year. The company named Gregg Scarlett as Bonefish’s CEO in March 2015. Founding Seasons 52 chef, Clifford Pleau was hired away to Bonefish in Sept. 2014. Since then, the restaurant chain has simplified its menu and instituted an updated look inside newer restaurants.

“They are clearly in the middle of a turnaround,” Knapp said. “Bonefish is not young. The market has moved on from them. But it’s not unusual for large chains to do some pruning like this periodically.”

Bonefish Grill opened two new restaurants in the U.S. from September to December 2015, bringing the total count to 210. The company opened more than a dozen Bonefish locations from 2014 to 2015. However, Smith said in August that development for Bonefish would stall until sales improved.

Carrabba’s Italian Grill also had a shake up in leadership. Bloomin’ Brands announced that Mike Kappitt was named president the day before Bloomin’ released its fourth quarter results. Kappitt will be responsible for leading operations and development of the Carrabba’s brand in the U.S. He most recently served as the senior vice president and chief marketing officer of Bloomin’ Brands. The former president, David Pace, left the company to become CEO at Jamba Juice last month.

Bloomin’ Brands fourth-quarter revenue was $1.04 billion, down 5.3 percent from the fourth quarter of 2014. The company’s net income for the fourth quarter was $17.7 million, down from $22.4 million the year before. Earnings per share were 14 cents for the quarter, down from 17 cents in 2014. Sales were down for the quarter at brands across the U.S. Sales in international markets were up — Outback Steakhouse sales in Brazil saw a 7.3 percent increase. The company operates 75 Outback Steakhouse restaurants in Brazil and 75 in South Korea.

Shares in Bloomin’ Brands fell nearly 11 percent Wednesday to $15.10 despite strong daily gains by all the major U.S. stock markets. The company’s stock price has not been this low since 2012.