Restaurant chains are realizing they can’t test-drive the future in vehicles conceived for the past. No wonder a growing number are opening specialized formats that leapfrog over the limitations of current designs, if not their very names and characters. They’re the restaurant equivalent of the auto industry’s concept cars.
California Tortilla was the most recent chain to take that route, announcing plans to open two scaled-down R&D units bearing the name Burrito Elito, which is also the name of the chain’s frequent-guest program. Both will be located in airports, which facilitate test marketing because they host such a broad swath of the consuming public.
BJ’s Restaurants has already generated four months’ worth of results for its R&D vehicle, a single outlet in southern California called BJ’s Grill. The concept suggests that BJ’s core brand may be looking for some tonier design accents, with features like booth seating and less of a sports-bar feel.
P.F. Chang’s has opened its lab in the same region where BJ’s has fired up its Grill. The Asian concept apparently wants to Americanize its appeal a bit; the test site drops the words “China Bistro” from its mother concept’s name, and features such decidedly American specialties as roast chicken with shoestring fries, and Alaskan black cod.
“The new Irvine P.F. Chang’s represents all that we’ve learned in 18 years, and what we hope to become over the next five to ten years,” said Chang’s president Lane Cardwell said at the time.
Those three chains follow the earlier lead of Burger King, whose Whopper Bar is serving as a testing ground for such new menu options as a shareable Whopper.
The parent of the Houston’s dinnerhouse chain also moved in that direction with the opening of the R+D Kitchen several years ago. The crucible for new ideas provided popular enough for the company, Hillstone Restaurants, to open two more.
It remains to be seen if the experiment becomes the expansion vehicle for some of the other concepts looking to do a little time-travel with their brands.
Showing posts with label P.F. Chang's. Show all posts
Showing posts with label P.F. Chang's. Show all posts
Monday, February 20, 2012
Tuesday, December 27, 2011
'Next Stop: Last Century'
Restaurateurs must’ve had their hearts broken this holiday season. All they found under the wrapping paper were iPads, flat screen TVs and the latest smart phones. What they really wanted, judging from recent news stories, was a time machine.
Not just any decades-jumper, but one that can take them back as well as forward, to the days when counter servers wore peaked paper caps. They want to capture the magic that made Hot Shoppes and A&W the dominant chains of their day. Why else would they be opening a new chapter for the brands?
In case you missed the particulars, Marriott Corp. is planning to open a Hot Shoppe in a Washington, D.C., hotel in early 2014. If you’re not familiar with the concept, it was a cross between a soda fountain, family restaurant and fast-food joint, serving up shakes, fries and burgers to the generation that’d parent the Baby Boomers.
It was also the foundation for the Marriott hospitality empire, which was originally known as Hot Shoppes, Inc. Founder J.Willard Marriott started in business as a restaurateur, first as an A&W franchisee (more on that in a minute), then as the builder of the Hot Shoppes chain (beginning in the late 1920s), and then as architect of the Big Boy system, which operated under a slew of regionalized names (Shoney’s, Frisch’s, JB’s, Abdow’s, Azar’s, etc.) Hotels would come later, largely under the tutelage of Willard’s son Bill, who’s about to retire.
Hot Shoppes gave more than the Marriotts a taste of the good life. At a time when full-service restaurants were largely upscale joints, it provided a way for workers and the lower middle class to have someone wait on them. My mother often recounted how she’d occasionally get a milk shake at a Hot Shoppe when she was studying to be a nurse in Washington, D.C., during World War II. She’d say it with the wistfulness of someone who’d just had tea with the Queen.
Hot Shoppes would plug along as a curiosity, a bit of nostalgia making too many concessions to the times, until 1999. Marriott has apparently decided that a 25-year gap without a Shoppes is too long.
Maybe it’s just a coincidence that a new chapter also opened this week for the brand that preceded Hot Shoppes in Marriott’s business model (the first store was converted from Willard Marriott’s A&W franchised unit). A&W has been quietly plugging along, gaining and losing stores, for eons. For a long while it shared resources with the likes of Taco Bell, KFC and Pizza Hut, serving as a co-branding partner for those sister Yum! Brands holdings.
But now A&W is on its own again. The brand was spun off to franchisees right before Christmas. They’ve vowed to grow the business, in part by taking advantage of A&W’s heritage. No doubt they’re looking to cruise back to happier days and bring that popularity back to the current day.
But that’s not the only time travel the industry is pursuing. As Restaurant Reality Check reported earlier, P.F. Chang’s hopes to get a glimpse of its future via a new one-of-a-kind bistro in southern California. The restaurant is intended to serve as a lab for how future stores will operate, right down to their menus and serving style (i.e., a heavy reliance on small plates).
Chang’s isn’t the only chain that’s asking itself, How can we anticipate what’s next for the brand if our test site is a facility built for today?
As some of Yelp’s citizen-reviewers have noted, BJ’s Restaurants has opened a downscale version of its signature concept, called BJ’s Grill. Management has stressed that the smaller riff is meant to be a testing ground for such futuristic touches as new technology, not a prototype.
Indeed, some of the features under scrutiny seem far afield from the current-day BJ’s. Yelp posters noted that the menu has a decidedly Mediterranean bent, with kabobs and hummus on the bill of fare.
The idea of building a futuristic unit is hardly new. Houston’s, the upscale chain whose restaurants sometimes operate under the Hillstone name, also runs an outlet called R&D Kitchen. As the name implies, the restaurant is a little more on the edge than a Houston’s.
Apparently it’s already given the time machine a try.
Not just any decades-jumper, but one that can take them back as well as forward, to the days when counter servers wore peaked paper caps. They want to capture the magic that made Hot Shoppes and A&W the dominant chains of their day. Why else would they be opening a new chapter for the brands?
In case you missed the particulars, Marriott Corp. is planning to open a Hot Shoppe in a Washington, D.C., hotel in early 2014. If you’re not familiar with the concept, it was a cross between a soda fountain, family restaurant and fast-food joint, serving up shakes, fries and burgers to the generation that’d parent the Baby Boomers.
It was also the foundation for the Marriott hospitality empire, which was originally known as Hot Shoppes, Inc. Founder J.Willard Marriott started in business as a restaurateur, first as an A&W franchisee (more on that in a minute), then as the builder of the Hot Shoppes chain (beginning in the late 1920s), and then as architect of the Big Boy system, which operated under a slew of regionalized names (Shoney’s, Frisch’s, JB’s, Abdow’s, Azar’s, etc.) Hotels would come later, largely under the tutelage of Willard’s son Bill, who’s about to retire.
Hot Shoppes gave more than the Marriotts a taste of the good life. At a time when full-service restaurants were largely upscale joints, it provided a way for workers and the lower middle class to have someone wait on them. My mother often recounted how she’d occasionally get a milk shake at a Hot Shoppe when she was studying to be a nurse in Washington, D.C., during World War II. She’d say it with the wistfulness of someone who’d just had tea with the Queen.
Hot Shoppes would plug along as a curiosity, a bit of nostalgia making too many concessions to the times, until 1999. Marriott has apparently decided that a 25-year gap without a Shoppes is too long.
Maybe it’s just a coincidence that a new chapter also opened this week for the brand that preceded Hot Shoppes in Marriott’s business model (the first store was converted from Willard Marriott’s A&W franchised unit). A&W has been quietly plugging along, gaining and losing stores, for eons. For a long while it shared resources with the likes of Taco Bell, KFC and Pizza Hut, serving as a co-branding partner for those sister Yum! Brands holdings.
But now A&W is on its own again. The brand was spun off to franchisees right before Christmas. They’ve vowed to grow the business, in part by taking advantage of A&W’s heritage. No doubt they’re looking to cruise back to happier days and bring that popularity back to the current day.
But that’s not the only time travel the industry is pursuing. As Restaurant Reality Check reported earlier, P.F. Chang’s hopes to get a glimpse of its future via a new one-of-a-kind bistro in southern California. The restaurant is intended to serve as a lab for how future stores will operate, right down to their menus and serving style (i.e., a heavy reliance on small plates).
Chang’s isn’t the only chain that’s asking itself, How can we anticipate what’s next for the brand if our test site is a facility built for today?
As some of Yelp’s citizen-reviewers have noted, BJ’s Restaurants has opened a downscale version of its signature concept, called BJ’s Grill. Management has stressed that the smaller riff is meant to be a testing ground for such futuristic touches as new technology, not a prototype.
Indeed, some of the features under scrutiny seem far afield from the current-day BJ’s. Yelp posters noted that the menu has a decidedly Mediterranean bent, with kabobs and hummus on the bill of fare.
The idea of building a futuristic unit is hardly new. Houston’s, the upscale chain whose restaurants sometimes operate under the Hillstone name, also runs an outlet called R&D Kitchen. As the name implies, the restaurant is a little more on the edge than a Houston’s.
Apparently it’s already given the time machine a try.
Tuesday, December 13, 2011
Is P.F. Chang's smarter than Chipotle?
Place your bets and get out of the way. We’re about to see who’s nailed the right future for an Asian restaurant chain, Chipotle or P.F Chang’s.
Unless you’ve been really, really preoccupied with Herman Cain’s political complications, you’re probably aware that Chipotle intends to launch a chain of fast-casual restaurants featuring authentically flavored Asian fare. Management hasn’t shared much information about the early performance of ShopHouse Southeast Asian Kitchen, which borrows Chipotle’s serving-line format. But founder Steve Ells has commented that patrons have complained about the spiciness of the food, much as customers did when Chipotle started. He’s proudly cited that pushback as proof the concept is positioned where few ethnic chains have dared American taste buds to follow.
Contrast that push-the-margins approach with the new direction P.F. Chang’s is exploring. The company announced that it’s opening a test lab of sorts today to try the recipes, design features and other elements that will likely figure into its namesake concept’s future. It’s “what we hope to become over the next five to 10 years,” said chain president Lane Cardwell.
Currently under test are seven entrees available only at the new southern California outpost. There’s a roast chicken served with shoestring fries, jazzed up with a Sichuan rub and other Asian touches (the fries are tossed with “crispy sesame,” for instance). But it still sounds a lot like roast chicken and fries, just with a little more spice.
There’s also a steak frites, served with fries, and a double-cut pork chop, which is fast becoming a casual-dining staple.
You can also get Alaskan black cod, Scottish salmon or Alaskan halibut, all served in one grilled entrée. Here again, the spices are Asian, but the foundation of the dish hails from elsewhere in the world.
Indeed, it sounds like Chang’s is trying a more mainstream American approach, perhaps to counter a traffic drop-off that’s been steeper than the slowdown for many grill-and-bar-type competitors. The change in strategy is surprising because Chang’s has always been a bit of a niche player, with a menu that goes far beyond what you'd find in your order-by-number neighborhood Asian joint.
The directional adjustment--and remember, it's still under test--may prove to be a smart strategy. It's just contrary to the body of 2012 prognostications, which almost unanimously foresaw exploration of unfamiliar ethnic dishes and flavors.
Then again, Chipotle might have the better idea. Or maybe authenticity works in the fast-casual market, but not in the full-service arena.
Whatever happens, it’s one of the most marked recent examples of chains moving in directly opposite directions.
Unless you’ve been really, really preoccupied with Herman Cain’s political complications, you’re probably aware that Chipotle intends to launch a chain of fast-casual restaurants featuring authentically flavored Asian fare. Management hasn’t shared much information about the early performance of ShopHouse Southeast Asian Kitchen, which borrows Chipotle’s serving-line format. But founder Steve Ells has commented that patrons have complained about the spiciness of the food, much as customers did when Chipotle started. He’s proudly cited that pushback as proof the concept is positioned where few ethnic chains have dared American taste buds to follow.
Contrast that push-the-margins approach with the new direction P.F. Chang’s is exploring. The company announced that it’s opening a test lab of sorts today to try the recipes, design features and other elements that will likely figure into its namesake concept’s future. It’s “what we hope to become over the next five to 10 years,” said chain president Lane Cardwell.
Currently under test are seven entrees available only at the new southern California outpost. There’s a roast chicken served with shoestring fries, jazzed up with a Sichuan rub and other Asian touches (the fries are tossed with “crispy sesame,” for instance). But it still sounds a lot like roast chicken and fries, just with a little more spice.
There’s also a steak frites, served with fries, and a double-cut pork chop, which is fast becoming a casual-dining staple.
You can also get Alaskan black cod, Scottish salmon or Alaskan halibut, all served in one grilled entrée. Here again, the spices are Asian, but the foundation of the dish hails from elsewhere in the world.
Indeed, it sounds like Chang’s is trying a more mainstream American approach, perhaps to counter a traffic drop-off that’s been steeper than the slowdown for many grill-and-bar-type competitors. The change in strategy is surprising because Chang’s has always been a bit of a niche player, with a menu that goes far beyond what you'd find in your order-by-number neighborhood Asian joint.
The directional adjustment--and remember, it's still under test--may prove to be a smart strategy. It's just contrary to the body of 2012 prognostications, which almost unanimously foresaw exploration of unfamiliar ethnic dishes and flavors.
Then again, Chipotle might have the better idea. Or maybe authenticity works in the fast-casual market, but not in the full-service arena.
Whatever happens, it’s one of the most marked recent examples of chains moving in directly opposite directions.
Friday, October 28, 2011
Raising a glass to Happy Hours
If you doubt the Happy Hour is making a comeback, consider the sales elixirs two heavy-pouring restaurant chains are currently sucking down.
The pair acknowledged this month that they’d uncorked what’s again becoming the most common sales lubricant in casual dining. Brinker International was the more recent to join the likes of P.F. Chang’s and Cheesecake Factory, announcing Wednesday that its Chili’s chain was rolling a “full-blown Happy Hour program,” in the words of CEO Doug Brooks.
Speaking to investors, Brooks was sketchy on details. But he divulged that the lures for the post-work crowd would include sangria, an upgraded version of Chili’s signature margaritas, and new food offerings at the bar.
He described the push for evening guests as one of Chili’s “very big initiatives” for rebounding from the Great Recession, which walloped all of casual dining. The rollout is right up there in strategic importance with the redesign of the concept and the changeover to more efficient kitchens, he stressed.
The financial analysts listening to Brooks refused to let his tease pass without amplification. Pressed a bit, Brooks described the new program as a natural outgrowth of Chili’s re-imaging, which extends to such bar enhancements as the installation of better flat screen TVs. He also spoke cryptically about changes that put the bartender in a position to field more drink orders.
But Brooks rebuffed requests for any sales info from the program’s market tests, which he characterized as having just concluded.
Three weeks earlier, Ruby Tuesday provided a few details about its Happy Hour program, which is already in place at the diversified company’s namesake chain (Ruby Tuesday now has more brands in its portfolio than some of the bigger private-equity firms.) CEO Sandy Beall noted that the draws include half-price appetizers and $2 tacos and sliders.
“The investments we've made in our beverage lineup and bar program should help us reach our long-term goal of increasing alcohol sales to 12% of revenue,” Beall said in Ruby’s conference call with investors.
Looks as if Ruby Tuesday is going to have a lot more competition in getting there.
The pair acknowledged this month that they’d uncorked what’s again becoming the most common sales lubricant in casual dining. Brinker International was the more recent to join the likes of P.F. Chang’s and Cheesecake Factory, announcing Wednesday that its Chili’s chain was rolling a “full-blown Happy Hour program,” in the words of CEO Doug Brooks.
Speaking to investors, Brooks was sketchy on details. But he divulged that the lures for the post-work crowd would include sangria, an upgraded version of Chili’s signature margaritas, and new food offerings at the bar.
He described the push for evening guests as one of Chili’s “very big initiatives” for rebounding from the Great Recession, which walloped all of casual dining. The rollout is right up there in strategic importance with the redesign of the concept and the changeover to more efficient kitchens, he stressed.
The financial analysts listening to Brooks refused to let his tease pass without amplification. Pressed a bit, Brooks described the new program as a natural outgrowth of Chili’s re-imaging, which extends to such bar enhancements as the installation of better flat screen TVs. He also spoke cryptically about changes that put the bartender in a position to field more drink orders.
But Brooks rebuffed requests for any sales info from the program’s market tests, which he characterized as having just concluded.
Three weeks earlier, Ruby Tuesday provided a few details about its Happy Hour program, which is already in place at the diversified company’s namesake chain (Ruby Tuesday now has more brands in its portfolio than some of the bigger private-equity firms.) CEO Sandy Beall noted that the draws include half-price appetizers and $2 tacos and sliders.
“The investments we've made in our beverage lineup and bar program should help us reach our long-term goal of increasing alcohol sales to 12% of revenue,” Beall said in Ruby’s conference call with investors.
Looks as if Ruby Tuesday is going to have a lot more competition in getting there.
Tuesday, December 14, 2010
So long to a legend
One of the establishments that shaped the U.S. restaurant industry—the trade’s own Chuck Berry—will shut its doors for good on Dec. 31. After 91 years, Regas Restaurant will no longer show the business how important service can and should be.
You might not have heard of it, but the chances are extremely high that you’ve felt its influence. If you dined at a P.F. Chang’s, for instance. The company is co-led by Rick Federico, one of the many, many industry standouts who learned the business from paterfamilias Bill Regas, a true legend.
When I was the editor of Restaurant Business magazine, we ran an annual feature called the Undercover Service Report, where the editors and our freelancers acted as finicky customers to test the service mettle of various restaurant chains. Bill wrote me a letter, saying that the story would be a yawner if places could just remember to put the customer first. By all accounts, his family’s Knoxville institution never forgot that imperative.
Dave Thomas, the founder of Wendy’s, would remember his education at Regas decades later. Thomas started working there at age 12. According to the legend, he was fired in short order because he didn’t agree with management. He supposedly vowed never to repeat his mistake and lose another job. Working with management became a hallmark of his time at KFC, where he first became a multi-millionaire, and then Wendy’s.
Despite the trajectory of Thomas’ career, the Regas’ influence was felt mainly in casual dining, not quick service. Indeed, Brinker International, the parent of Chili’s, bought rights to build a chain of Regas-inspired restaurants. The name was changed to Grady’s, and the concept was watered down, starting with the ice cream, then moving to other aspects.
It proved to be a bomb for Chili’s, which sold the rights to Quality Dining, a Burger King and Chili’s franchisee,
which completely re-engineered the DNA.
The times apparently caught up with the Regas, however. Business by all accounts has been down, so the current owners decided to shut down with the close of the year.
But fans should take heart: The restaurant closed once before, in 2000, only to reopen in ’02.
It’s been navigating the changes in consumer tastes and its local market place ever since. That process may end, but the restaurant’s influence lives on.
You might not have heard of it, but the chances are extremely high that you’ve felt its influence. If you dined at a P.F. Chang’s, for instance. The company is co-led by Rick Federico, one of the many, many industry standouts who learned the business from paterfamilias Bill Regas, a true legend.
When I was the editor of Restaurant Business magazine, we ran an annual feature called the Undercover Service Report, where the editors and our freelancers acted as finicky customers to test the service mettle of various restaurant chains. Bill wrote me a letter, saying that the story would be a yawner if places could just remember to put the customer first. By all accounts, his family’s Knoxville institution never forgot that imperative.
Dave Thomas, the founder of Wendy’s, would remember his education at Regas decades later. Thomas started working there at age 12. According to the legend, he was fired in short order because he didn’t agree with management. He supposedly vowed never to repeat his mistake and lose another job. Working with management became a hallmark of his time at KFC, where he first became a multi-millionaire, and then Wendy’s.
Despite the trajectory of Thomas’ career, the Regas’ influence was felt mainly in casual dining, not quick service. Indeed, Brinker International, the parent of Chili’s, bought rights to build a chain of Regas-inspired restaurants. The name was changed to Grady’s, and the concept was watered down, starting with the ice cream, then moving to other aspects.
It proved to be a bomb for Chili’s, which sold the rights to Quality Dining, a Burger King and Chili’s franchisee,
which completely re-engineered the DNA.
The times apparently caught up with the Regas, however. Business by all accounts has been down, so the current owners decided to shut down with the close of the year.
But fans should take heart: The restaurant closed once before, in 2000, only to reopen in ’02.
It’s been navigating the changes in consumer tastes and its local market place ever since. That process may end, but the restaurant’s influence lives on.
Sunday, March 28, 2010
Welcome back, happy hour
Gather ‘round, youngsters, and hear of a day when casual restaurants were known as “fern bars,” and loaded potato skins were about the coolest thing you’d find on a restaurant menu. Heck, you could even drink legally at age 18 back then, provided mom or dad would loan you the Nova or Maverick.
In the keen competition for young imbibers, places would offer a passel of attractions under the common slug of Happy Hour. A typical element was offering two drinks for the price of one, though the deals could range to such drool-inducers as getting your second and third drinks for a penny, or women drinking for free all night. We’d shop the various offers to determine who had the best giveaway. Life was sweet.
Then came the crackdown on drunken driving, a worthy cause that tarred happy hours as a major threat to innocent lives. They had to go, insisted groups like MADD. Restaurants tried to save the draws with adjustments like free food or bans of two-for-one, but the breed was clearly doomed.
Now come ample indications that happy hours are making a comeback, this time with the focus on food and quality drinks, not cheap intoxication. P.F. Chang’s, for instance, is offering sake for $4 (for a “large jar”), high balls for the same price, and decent wines for $5. For $6, you can get spare ribs, shrimp or seared ahi tuna. This is not your old uncle’s happy hour.
Then again, there are some familiarities. The Z’Tejas casual chain, for instance, offers a bunch of items at half price, or two-for-one if you prefer that frame of reference. But these are appetizers, not Mellon Balls.
Cheesecake Factory is doing the same thing, at least in some markets. Sure, you can get a Cosmo and similar specialty drinks for $5. But the spotlight is on 15 appetizers available for half price from late afternoon to early evening.
The Happy Hour is clearly back, this time as a way to enjoy foods at a steal. I’ll still miss my Alabama Slammers for 50 cents, but four mini spring rolls for $2, or free sliders, isn’t a bad draw. Especially if you can get a Pabst Blue Ribbon for $2, or not much more than we’d spend back in the day.
It’s enough to knock you off your platform shoes.
In the keen competition for young imbibers, places would offer a passel of attractions under the common slug of Happy Hour. A typical element was offering two drinks for the price of one, though the deals could range to such drool-inducers as getting your second and third drinks for a penny, or women drinking for free all night. We’d shop the various offers to determine who had the best giveaway. Life was sweet.
Then came the crackdown on drunken driving, a worthy cause that tarred happy hours as a major threat to innocent lives. They had to go, insisted groups like MADD. Restaurants tried to save the draws with adjustments like free food or bans of two-for-one, but the breed was clearly doomed.
Now come ample indications that happy hours are making a comeback, this time with the focus on food and quality drinks, not cheap intoxication. P.F. Chang’s, for instance, is offering sake for $4 (for a “large jar”), high balls for the same price, and decent wines for $5. For $6, you can get spare ribs, shrimp or seared ahi tuna. This is not your old uncle’s happy hour.
Then again, there are some familiarities. The Z’Tejas casual chain, for instance, offers a bunch of items at half price, or two-for-one if you prefer that frame of reference. But these are appetizers, not Mellon Balls.
Cheesecake Factory is doing the same thing, at least in some markets. Sure, you can get a Cosmo and similar specialty drinks for $5. But the spotlight is on 15 appetizers available for half price from late afternoon to early evening.
The Happy Hour is clearly back, this time as a way to enjoy foods at a steal. I’ll still miss my Alabama Slammers for 50 cents, but four mini spring rolls for $2, or free sliders, isn’t a bad draw. Especially if you can get a Pabst Blue Ribbon for $2, or not much more than we’d spend back in the day.
It’s enough to knock you off your platform shoes.
Thursday, October 29, 2009
A candy dish of info treats
Panera Bread Co. is having a bang-up October, according to CEO Ron Shaich. He told investors yesterday that comp sales for company stores were running 6.9% above last year’s tally for the first 27 days of the month, and franchisees’ sales were tracking at a 6.3% rise.
Meanwhile, the bakery-café chain is busy plotting some significant menu changes. First on the list is the introduction of salmon, both as a sandwich ingredient and a salad component, said Shaich. That will be followed by the revamp of the concept’s panini sandwiches, which are currently pre-made, he said. New presses to be added around the middle of next year will enable units to make the grilled sandwiches to order because of their speed.
Nearer term, units will start merchandising holiday baked goods, from gingerbread men to Panatone to “holly cake,” at their registers.
Three days, three restaurant-chain bankrutpcy filings. Max & Erma’s efforts to secure Ch. 11 protection from creditors has been well-publicized. The bankruptcy of sister operation Damon’s International has been far less so. And largely unnoticed has been the Ch. 11 filing of Ham’s, operator-franchisor of a 20-unit namesake chain in North Carolina and Virginia.
More evidence that the Japanese fast-food market is whack-o: Authorities have reportedly concluded that the manager of a McDonald’s there worked herself to death by logging 20 hours a week of overtime. News reports say she’s one of about 150 people who work to the point of demise in Japan every year.
That news of course follows the introduction of a new Burger King Whopper that features seven beef patties, a tie-in with Microsoft’s new Windows 7 operating system. There are so many reasons for head-shaking over that one that it doesn’t pay to start.
Kerrii Anderson, the CEO of Wendy’s International during the chain’s final meltdown and subsequent sale, is being paid $175,000 a year to serve on the board of P.F. Chang’s. Anderson also serves on the board of Chiquita Brands International, the banana importer, where she’s paid at least $160,000 a year. And she was expected to make about $4.6 million from the company’s 2008 sale to Triarc, the parent of the once-rival Arby’s fast-food chain. In short, if you’re scheduled to have lunch with her in the near future, there’s no question of who’s paying.
Hotel unions have voted to strike at a handful of properties in both San Francisco and Chicago. It’s not clear whether its coincidental harrumphing or a concerted effort to prove that the union’s strength isn’t being undercut by the economy, as conventional wisdom holds.
Meanwhile, the bakery-café chain is busy plotting some significant menu changes. First on the list is the introduction of salmon, both as a sandwich ingredient and a salad component, said Shaich. That will be followed by the revamp of the concept’s panini sandwiches, which are currently pre-made, he said. New presses to be added around the middle of next year will enable units to make the grilled sandwiches to order because of their speed.
Nearer term, units will start merchandising holiday baked goods, from gingerbread men to Panatone to “holly cake,” at their registers.
Three days, three restaurant-chain bankrutpcy filings. Max & Erma’s efforts to secure Ch. 11 protection from creditors has been well-publicized. The bankruptcy of sister operation Damon’s International has been far less so. And largely unnoticed has been the Ch. 11 filing of Ham’s, operator-franchisor of a 20-unit namesake chain in North Carolina and Virginia.
More evidence that the Japanese fast-food market is whack-o: Authorities have reportedly concluded that the manager of a McDonald’s there worked herself to death by logging 20 hours a week of overtime. News reports say she’s one of about 150 people who work to the point of demise in Japan every year.
That news of course follows the introduction of a new Burger King Whopper that features seven beef patties, a tie-in with Microsoft’s new Windows 7 operating system. There are so many reasons for head-shaking over that one that it doesn’t pay to start.
Kerrii Anderson, the CEO of Wendy’s International during the chain’s final meltdown and subsequent sale, is being paid $175,000 a year to serve on the board of P.F. Chang’s. Anderson also serves on the board of Chiquita Brands International, the banana importer, where she’s paid at least $160,000 a year. And she was expected to make about $4.6 million from the company’s 2008 sale to Triarc, the parent of the once-rival Arby’s fast-food chain. In short, if you’re scheduled to have lunch with her in the near future, there’s no question of who’s paying.
Hotel unions have voted to strike at a handful of properties in both San Francisco and Chicago. It’s not clear whether its coincidental harrumphing or a concerted effort to prove that the union’s strength isn’t being undercut by the economy, as conventional wisdom holds.
Wednesday, October 28, 2009
Trends from U.S. chain menus, words from N.Y.
Fast-food, that most American of social constructs, is turning downright jingoistic in its sourcing.
Cock an ear to Wendy’s new ad campaign and you’ll hear the chain boast of using only North American beef in its square burgers. Fuddruckers, the chain that was fast-casual before fast-casual was cool, is more pointed in its nationalism. Units in Texas and New Mexico have switched to a proprietary grind called Fudds Prime, made exclusively with “All-American” prime beef from “select U.S. ranches,” the announcement sniffs. Chew on that gristle, Canada and Australia.
The rah-rah mentions of homefront ingredients are part of a larger struggle by the chain business to accommodate the public’s insistence that it be told the source of what it’s eating. Ideally, that point of origin would be a local one. Indeed, the demand for locally grown produce was forecast by chef-participants in a National Restaurant Association survey to be the Number One consumer trend of 2009.
The menus of many independent restaurants show those respondents were dead-on. The shorter the distance from field to fork, the louder the establishment tends to crow about it in menu descriptors. Not that it’s obnoxious at all. Guests want that sort of horn blowing. Why not brag about the seasonal items you’re putting on the plate?
But it’s hard to serve up that kind of lingo when you’re a sprawling chain with a nationwide supply system. Their economics call for low-cost ingredients hyper-processed to the point of absolute consistency and cooking readiness. Just add heat, forget about seasonal freshness. It was a trend many figured they’d watch independent counterparts enjoy without challenge.
Wrong. It took awhile, but regional chains are clearly finding religion. And even the national ones are buying local ingredients in some spots—or at least spotlighting the instances where that’s been the practice. Outback Steakhouses in the Louisiana area have apparently always used shrimp harvested by the state’s Gulf shrimpers. It briefly changed its mind because imported shrimp was selling at a lower price, then opted in the eleventh hour to stay local. The news prompted Louisiana Gov. Bobby Jindal to hold a press conference where he lauded the casual chain as the video cameras hummed.
Last month, New England-based Papa Gino’s Pizzeria and its sandwich-serving sister, D’Angelo’s, added a bunch of products that feature Cheddar cheese produced in Vermont. The chains were aiming for what one executive called “a distinctive New England flavor,” which you don’t usually associate with pizzas or subs. Yet “Vermont Cheddar” is included in all but one of the new products’ names (the exception, a Bruschetta, incorporates just “Cheddar”).
This summer, the New England outposts of Panera Bread Co. featured a lobster sandwich, a local favorite usually described as a lobster roll. It was priced at $16.99.
Units of the Smashburger fast-casual chain feature reginal riffs on burgers and hot dogs (i.e., Colorado units feature the popular local topping of green chilis), and the Kona Grill casual chain told investors that it'll introduce a menu next month that includes a section for local favorites from any given store's host area.
Then there’s the poster-concept of the localization movement among chains, the Pacific Northwest’s 38-unit Burgerville group. Right now the brand is featuring sweet potato fries made from local sweet potatoes, which are currently in season. It’s also featured Washington State cherries, in a Cherry Chipotle Pulled Pork Sandwich, and is currently touting a hotdog garnished with a slaw made of local apples.
The novelty of finding local ingredients on chains’ menus should start to wear off as several large-scale players start shopping closer to their stores. Chipotle Mexican Grill, for instance, has pledged to purchase 35% of at least one produce item per restaurant from local farmers.
With roughly 900 branches, Chipotle may be the largest chain to pursue seasonal fare. But it’s certainly not the first, nor the model example. Critics have noted that its so-called local fare may be drawn from a 250-mile radius, which certainly stretches the definition.
Contrast that with Eat’n Park, the Pittsburgh-based family dining chain. The company has a director of sourcing and sustainability who goes out to find farmers who can supply the chain. When local items like radishes are used by any of the brand’s 75 stores, notice is often given to customers via the chain’s blog.
Those early adapters are being joined by the likes of Darden Restaurants, best known as the parent of Red Lobster and Olive Garden. Its youngest brand, Seasons 52, features seasonal ingredients blended into entrees with fewer than 475 calories.
P.F. Chang’s, a strong competitor to Darden, has invested in a start-up concept called True Food Kitchen. Like Seasons 52, it features seasonal fare, but goes a step further to use local and organic foodstuffs.
Where chains can’t tout the use of local ingredients, they’re doing the next best thing of highlighting the source. Seasons 52, for instance, is currently featuring Colorado Buffalo Chili, Canadian Black Mussels Marinara and a Gulf Shrimp Cocktail.
Is there any doubt that the source-naming trend, and the local variant in particular, is going to continue?
Indeed, there’s one form in particular that we’re likely to see. It’s not widely known by the public, but outlets of the giant burger chains buy their buns from a network of regional or local bakeries set up by the home office. Those suppliers aren’t exactly mom-and-pop shops. But they do offer an opportunity for the behemoths of the business to tout a little localization. I bet we see that start to happen, sooner versus later.
Cock an ear to Wendy’s new ad campaign and you’ll hear the chain boast of using only North American beef in its square burgers. Fuddruckers, the chain that was fast-casual before fast-casual was cool, is more pointed in its nationalism. Units in Texas and New Mexico have switched to a proprietary grind called Fudds Prime, made exclusively with “All-American” prime beef from “select U.S. ranches,” the announcement sniffs. Chew on that gristle, Canada and Australia.
The rah-rah mentions of homefront ingredients are part of a larger struggle by the chain business to accommodate the public’s insistence that it be told the source of what it’s eating. Ideally, that point of origin would be a local one. Indeed, the demand for locally grown produce was forecast by chef-participants in a National Restaurant Association survey to be the Number One consumer trend of 2009.
The menus of many independent restaurants show those respondents were dead-on. The shorter the distance from field to fork, the louder the establishment tends to crow about it in menu descriptors. Not that it’s obnoxious at all. Guests want that sort of horn blowing. Why not brag about the seasonal items you’re putting on the plate?
But it’s hard to serve up that kind of lingo when you’re a sprawling chain with a nationwide supply system. Their economics call for low-cost ingredients hyper-processed to the point of absolute consistency and cooking readiness. Just add heat, forget about seasonal freshness. It was a trend many figured they’d watch independent counterparts enjoy without challenge.
Wrong. It took awhile, but regional chains are clearly finding religion. And even the national ones are buying local ingredients in some spots—or at least spotlighting the instances where that’s been the practice. Outback Steakhouses in the Louisiana area have apparently always used shrimp harvested by the state’s Gulf shrimpers. It briefly changed its mind because imported shrimp was selling at a lower price, then opted in the eleventh hour to stay local. The news prompted Louisiana Gov. Bobby Jindal to hold a press conference where he lauded the casual chain as the video cameras hummed.
Last month, New England-based Papa Gino’s Pizzeria and its sandwich-serving sister, D’Angelo’s, added a bunch of products that feature Cheddar cheese produced in Vermont. The chains were aiming for what one executive called “a distinctive New England flavor,” which you don’t usually associate with pizzas or subs. Yet “Vermont Cheddar” is included in all but one of the new products’ names (the exception, a Bruschetta, incorporates just “Cheddar”).
This summer, the New England outposts of Panera Bread Co. featured a lobster sandwich, a local favorite usually described as a lobster roll. It was priced at $16.99.
Units of the Smashburger fast-casual chain feature reginal riffs on burgers and hot dogs (i.e., Colorado units feature the popular local topping of green chilis), and the Kona Grill casual chain told investors that it'll introduce a menu next month that includes a section for local favorites from any given store's host area.
Then there’s the poster-concept of the localization movement among chains, the Pacific Northwest’s 38-unit Burgerville group. Right now the brand is featuring sweet potato fries made from local sweet potatoes, which are currently in season. It’s also featured Washington State cherries, in a Cherry Chipotle Pulled Pork Sandwich, and is currently touting a hotdog garnished with a slaw made of local apples.
The novelty of finding local ingredients on chains’ menus should start to wear off as several large-scale players start shopping closer to their stores. Chipotle Mexican Grill, for instance, has pledged to purchase 35% of at least one produce item per restaurant from local farmers.
With roughly 900 branches, Chipotle may be the largest chain to pursue seasonal fare. But it’s certainly not the first, nor the model example. Critics have noted that its so-called local fare may be drawn from a 250-mile radius, which certainly stretches the definition.
Contrast that with Eat’n Park, the Pittsburgh-based family dining chain. The company has a director of sourcing and sustainability who goes out to find farmers who can supply the chain. When local items like radishes are used by any of the brand’s 75 stores, notice is often given to customers via the chain’s blog.
Those early adapters are being joined by the likes of Darden Restaurants, best known as the parent of Red Lobster and Olive Garden. Its youngest brand, Seasons 52, features seasonal ingredients blended into entrees with fewer than 475 calories.
P.F. Chang’s, a strong competitor to Darden, has invested in a start-up concept called True Food Kitchen. Like Seasons 52, it features seasonal fare, but goes a step further to use local and organic foodstuffs.
Where chains can’t tout the use of local ingredients, they’re doing the next best thing of highlighting the source. Seasons 52, for instance, is currently featuring Colorado Buffalo Chili, Canadian Black Mussels Marinara and a Gulf Shrimp Cocktail.
Is there any doubt that the source-naming trend, and the local variant in particular, is going to continue?
Indeed, there’s one form in particular that we’re likely to see. It’s not widely known by the public, but outlets of the giant burger chains buy their buns from a network of regional or local bakeries set up by the home office. Those suppliers aren’t exactly mom-and-pop shops. But they do offer an opportunity for the behemoths of the business to tout a little localization. I bet we see that start to happen, sooner versus later.
Friday, August 21, 2009
Getting bounce from 'balance'
Wipe “locavore” and “natural” off the whiteboard. A new buzzword for restaurant menu planners is starting to take hold: “Balance.”
That’s the underlying principle of True Food Kitchen, the new concept that P.F. Chang’s has decided to back with a $10-million infusion of growth capital. If the emperor of Asian casual dining likes what it fosters, it has the option of buying a controlling stake in the brainchild of Sam Fox, the Rich Melman of Phoenix. The young concept creator’s earlier hatchlings include the Sauce pizza and wine fast-casual chain and one-offs like Olive & Ivy.
True Food is a foodservice retreat for those seeking “a more balanced lifestyle,” according to Fox’s company, Fox Restaurant Concepts. It was created in collaboration with a New Age medical guru, Dr. Andrew Weil, who advocates a blend of conventional medicine and alternative aids like herbs and moderation.
It may be the most visible proponent of the new balance sensibility, but it’s hardly alone. Across the Atlantic, Sodexo, the contract-feeding giant, is featuring a menu based on “balanced nutrition” at 500 of the institutional feeding operations it manages. The aim of the new Vitality line-up, according to the France-based company, is to provide healthy dining options without sacrificing the enjoyment. In short, it aims to strike a balance.
The strategy is hardly unknown on this side of the pond. Seasons 52, Darden Restaurant’s brilliant play for aging Baby Boomers, promises the same sort of balance between taste, indulgence and health concerns. You can have a low-calorie entrée, finish it off with tiny shot-glass-sized desserts, and wash it down with a few selections from the concept’s extensive wine list.
“Balance” also figured into Mimi’s selection of the winner in a customer recipe contest. Patrons were asked to come up with a Meaningful Muffin that could be added to the casual chain’s menu. The winner was a Pineapple Coconut Crumb preparation, praised in part by celebrity judge/chef Gale Gand for its “perfect balance of flavors and textures.” In part because of that distinction, “we felt it would appeal best to a wide audience,” said the Chicago restaurateur.
Clearly “balance” is being used in a variety of ways, just as “health,” “fresh,” “wholesome” or “homestyle” once carried more definitions than a pocket-sized Webster’s. But all the applications suggest it’s a word that resonates right now with the public. For that reason, it’s certain to show up on more menus.
That’s the underlying principle of True Food Kitchen, the new concept that P.F. Chang’s has decided to back with a $10-million infusion of growth capital. If the emperor of Asian casual dining likes what it fosters, it has the option of buying a controlling stake in the brainchild of Sam Fox, the Rich Melman of Phoenix. The young concept creator’s earlier hatchlings include the Sauce pizza and wine fast-casual chain and one-offs like Olive & Ivy.
True Food is a foodservice retreat for those seeking “a more balanced lifestyle,” according to Fox’s company, Fox Restaurant Concepts. It was created in collaboration with a New Age medical guru, Dr. Andrew Weil, who advocates a blend of conventional medicine and alternative aids like herbs and moderation.
It may be the most visible proponent of the new balance sensibility, but it’s hardly alone. Across the Atlantic, Sodexo, the contract-feeding giant, is featuring a menu based on “balanced nutrition” at 500 of the institutional feeding operations it manages. The aim of the new Vitality line-up, according to the France-based company, is to provide healthy dining options without sacrificing the enjoyment. In short, it aims to strike a balance.
The strategy is hardly unknown on this side of the pond. Seasons 52, Darden Restaurant’s brilliant play for aging Baby Boomers, promises the same sort of balance between taste, indulgence and health concerns. You can have a low-calorie entrée, finish it off with tiny shot-glass-sized desserts, and wash it down with a few selections from the concept’s extensive wine list.
“Balance” also figured into Mimi’s selection of the winner in a customer recipe contest. Patrons were asked to come up with a Meaningful Muffin that could be added to the casual chain’s menu. The winner was a Pineapple Coconut Crumb preparation, praised in part by celebrity judge/chef Gale Gand for its “perfect balance of flavors and textures.” In part because of that distinction, “we felt it would appeal best to a wide audience,” said the Chicago restaurateur.
Clearly “balance” is being used in a variety of ways, just as “health,” “fresh,” “wholesome” or “homestyle” once carried more definitions than a pocket-sized Webster’s. But all the applications suggest it’s a word that resonates right now with the public. For that reason, it’s certain to show up on more menus.
Wednesday, August 12, 2009
P.F. Chang's bets $10M on new 'balance' concept
Food with integrity, the effective rallying cry of Chipotle Mexican Grill, has a high-profile new proponent. P.F. Chang's announced today that it's providing a $10-million loan to fund expansion of True Food Kitchen, a restaurant concept aimed at consumers who want a "more balanced lifestyle," in Chang's words. Among the new brand's signatures is the use of ingredients grown locally or at least within the store's region.
In announcing the deal, Chang's noted that it has an option to buy a controlling interest in the now-single-unit concept.
True Food was developed by Phoenix concept creator Sam Fox and the popular author Andrew Weill, an M.D. who runs a Tempe health facility called the Arizona Center for Integrative Medicine. He's the parent of integrative medicine, which holds that true wellness entails balance in mind, body and spirit. No doubt he burns a lot of incense.
The relationship is probably making Chang's feel better already. The parent of a namesake casual chain and a fast-casual sidekick, Pei Wei Asian Diner, has been struggling with those brands as of late, as have most of its competitors.
True Food sounds like shares more in common with Seasons 52, Darden Restaurants' smash hit of a casual concept, than with any other chain restaurant out there. And the name suggests it professes the same aversion to heavily processed food that has set Chipotle apart in the limited-service sector.
True Food's menu includes pastas, pizzas, salads, tuna sliders, house-made sodas sweetened with agave nectar or honey, 13 vegetarian selections, and 10 gluten-free choices.
It's a mix that Chang's apparently finds irresistible.
In announcing the deal, Chang's noted that it has an option to buy a controlling interest in the now-single-unit concept.
True Food was developed by Phoenix concept creator Sam Fox and the popular author Andrew Weill, an M.D. who runs a Tempe health facility called the Arizona Center for Integrative Medicine. He's the parent of integrative medicine, which holds that true wellness entails balance in mind, body and spirit. No doubt he burns a lot of incense.
The relationship is probably making Chang's feel better already. The parent of a namesake casual chain and a fast-casual sidekick, Pei Wei Asian Diner, has been struggling with those brands as of late, as have most of its competitors.
True Food sounds like shares more in common with Seasons 52, Darden Restaurants' smash hit of a casual concept, than with any other chain restaurant out there. And the name suggests it professes the same aversion to heavily processed food that has set Chipotle apart in the limited-service sector.
True Food's menu includes pastas, pizzas, salads, tuna sliders, house-made sodas sweetened with agave nectar or honey, 13 vegetarian selections, and 10 gluten-free choices.
It's a mix that Chang's apparently finds irresistible.
Thursday, February 12, 2009
What're the pacesetters trying next?
Three of the industry’s most closely monitored performers conferred with their investors yesterday in quarterly conference calls. Apparently the SEC has quietly changed its regulations to require that each confab include questions about bundled meals and other ways of coaxing open tightly clutched wallets. Here are some of the highlights:
McDonald’s is the indisputable king of fast-food, based on its consistently strong financial results. By the same gauge, you’d have to give the crown in casual dining to Buffalo Wild Wings.
Comp sales for the first three months of Wild Wings' fiscal 2009 are running at 7% for franchises, 8% for company stores, CEO Sally Smith told investors yesterday. No one else in the sector is coming close to those sorts of gains.
Smith also detailed some of the new products slated for rollouts, and they’re absolutely brilliant—because they’re so simple. For instance, one of the new items is merely a twist on chicken fingers, quite literally. Twisted Chicken is exactly that.
Those products are being readied after the introduction late last year of flat-bread items that intended to be dipped before they're munched. Sauces, developed for BWW’s wings, are one of the chain’s signatures.
The other new items—barbecue-flavored nachos and Pepperoni Kickers, presumably a type of appetizer—are also simple extensions, which promise to keep serving times tight.
Executives noted that BWW opened 67 stores last year, and has $44.5 million in cash and marketable securities on hand.
Chipotle clearly feels it’s no bank in a bailout situation. The chain said categorically that it would not cut 2008 bonuses across the board for restaurant managers, a reflection of that position’s importance and the stellar performance of many doing the job. If they excelled, execs indicated, they’ll be collecting their promised incentive pay-outs.
Nor is the chain following the lead of Starbucks and virtually the rest of the industry by bundling menu items into bargain-priced packages. The approach would work against Chipotle’s founding principle of customizing each order, executives explained.
But, they acknowledged, the chain is experimenting with new menu boards that may be less intimidating to first-time visitors. A new set-up might also help regulars discover new flavor or meal combinations, they added, though they weren’t forthcoming with details.
P.F. Chang’s is testing several ways to underscore value at its Pei Wei Asian Diner fast-casual concept, including portion cuts with an accompanying price rollback, executives said during their conference call yesterday.
“We’re looking at offering some of the existing products in a smaller portion, smaller price opportunity. We are looking at the possibility of doing some more all-inclusive dining opportunities. And then we are also evaluating the general format of the menu as it sits today in relationship to its current price,” said co-CEO Rick Federico.
He also cited the possibility of doing bundled meals, where a drink, cup of soup, side salad or spring roll could be offered as part of the meal. And, he said, nine stores are offering certain meals as bowls instead of a plated offering.
Federico said the concept has evolved into more of a low-priced alternative to casual restaurants instead of a true quick-casual place, which has been “a bit of a competitive disadvantage.” Part of the remedy, he said, will be a step-up in the development of new menu items.
He also acknowledged under questioning that the company may hire someone out of the fast-casual sector to lead Pei Wei, which has been without a president since Russell Owens resigned late last year.
P.F. Chang’s closed 10 Pei Weis last year.
McDonald’s is the indisputable king of fast-food, based on its consistently strong financial results. By the same gauge, you’d have to give the crown in casual dining to Buffalo Wild Wings.
Comp sales for the first three months of Wild Wings' fiscal 2009 are running at 7% for franchises, 8% for company stores, CEO Sally Smith told investors yesterday. No one else in the sector is coming close to those sorts of gains.
Smith also detailed some of the new products slated for rollouts, and they’re absolutely brilliant—because they’re so simple. For instance, one of the new items is merely a twist on chicken fingers, quite literally. Twisted Chicken is exactly that.
Those products are being readied after the introduction late last year of flat-bread items that intended to be dipped before they're munched. Sauces, developed for BWW’s wings, are one of the chain’s signatures.
The other new items—barbecue-flavored nachos and Pepperoni Kickers, presumably a type of appetizer—are also simple extensions, which promise to keep serving times tight.
Executives noted that BWW opened 67 stores last year, and has $44.5 million in cash and marketable securities on hand.
Chipotle clearly feels it’s no bank in a bailout situation. The chain said categorically that it would not cut 2008 bonuses across the board for restaurant managers, a reflection of that position’s importance and the stellar performance of many doing the job. If they excelled, execs indicated, they’ll be collecting their promised incentive pay-outs.
Nor is the chain following the lead of Starbucks and virtually the rest of the industry by bundling menu items into bargain-priced packages. The approach would work against Chipotle’s founding principle of customizing each order, executives explained.
But, they acknowledged, the chain is experimenting with new menu boards that may be less intimidating to first-time visitors. A new set-up might also help regulars discover new flavor or meal combinations, they added, though they weren’t forthcoming with details.
P.F. Chang’s is testing several ways to underscore value at its Pei Wei Asian Diner fast-casual concept, including portion cuts with an accompanying price rollback, executives said during their conference call yesterday.
“We’re looking at offering some of the existing products in a smaller portion, smaller price opportunity. We are looking at the possibility of doing some more all-inclusive dining opportunities. And then we are also evaluating the general format of the menu as it sits today in relationship to its current price,” said co-CEO Rick Federico.
He also cited the possibility of doing bundled meals, where a drink, cup of soup, side salad or spring roll could be offered as part of the meal. And, he said, nine stores are offering certain meals as bowls instead of a plated offering.
Federico said the concept has evolved into more of a low-priced alternative to casual restaurants instead of a true quick-casual place, which has been “a bit of a competitive disadvantage.” Part of the remedy, he said, will be a step-up in the development of new menu items.
He also acknowledged under questioning that the company may hire someone out of the fast-casual sector to lead Pei Wei, which has been without a president since Russell Owens resigned late last year.
P.F. Chang’s closed 10 Pei Weis last year.
Wednesday, February 11, 2009
More dark clouds, but is that a glimmer of sun?
The financial results released this morning by P.F. Chang's, once one of the industry's over-achievers, are less interesting than the company's projections for 2009: "a significant reduction in average weekly sales" of about 6 percent for both if its concepts. And, actually, that might be good news.
The figures are consistent with the comps posted for P.F. Chang's and Pei Wei Asian Diner for the last three months of 2008. Since the numbers reflect year-over-year comparisons, they suggest the downturn is leveling off. Might the industry be finding the bottom?
The announcement follows several promising additional developments, including yesterday's disclosure by beleagured GE Capital that it has lent $5.8 million to the eight-unit Boston Blackie's casual chain for expansion. Any loan extended to a restaurant company in the current environment is an encouraging sign, given how scarce capital has been. It's especially noteworthy because GE Capital has been the poster company for lenders that have been hurt by the banks' liquidity crisis.
This morning also brought the news that Tremblant Capital, a New York hedge fund, has increased its stake in Chipotle to 5.7%. Clearly the well-known, multi-billion-dollar fund believes shares are under-valued, or soon may be.
Similarly, fund manager John Hussman has greatly increased his stakes in Panera Bread Co. and Starbucks, and purchased shares of Darden for the first time.
A brightening view of restaurant stocks could only help the industry.
Still, the trade has a long way to go before it can claim the recovery is underway. P.F. Chang's profits for the last quarter of 2008 fell about 23%, to just $5.4 million.
The figures are consistent with the comps posted for P.F. Chang's and Pei Wei Asian Diner for the last three months of 2008. Since the numbers reflect year-over-year comparisons, they suggest the downturn is leveling off. Might the industry be finding the bottom?
The announcement follows several promising additional developments, including yesterday's disclosure by beleagured GE Capital that it has lent $5.8 million to the eight-unit Boston Blackie's casual chain for expansion. Any loan extended to a restaurant company in the current environment is an encouraging sign, given how scarce capital has been. It's especially noteworthy because GE Capital has been the poster company for lenders that have been hurt by the banks' liquidity crisis.
This morning also brought the news that Tremblant Capital, a New York hedge fund, has increased its stake in Chipotle to 5.7%. Clearly the well-known, multi-billion-dollar fund believes shares are under-valued, or soon may be.
Similarly, fund manager John Hussman has greatly increased his stakes in Panera Bread Co. and Starbucks, and purchased shares of Darden for the first time.
A brightening view of restaurant stocks could only help the industry.
Still, the trade has a long way to go before it can claim the recovery is underway. P.F. Chang's profits for the last quarter of 2008 fell about 23%, to just $5.4 million.
Saturday, December 27, 2008
And he could collect unemployment, too
Russ Owens may have lost one of the most coveted jobs in the business, but he probably had a nice holiday nonetheless. After announcing in late November that he would step down as president of the Pei Wei Asian Diner fast-casual chain, Owens and concept parent P.F. Chang’s agreed 10 days ago the longtime industry veteran would collect $800,000 in severance for his “resignation.”
The money is being paid in one lump sum. In addition, all stock options or other equity awards were vested immediately, according to the agreement, which was detailed in an SEC document filed on Christmas Eve.
In exchange, Owens agreed not to sue Chang’s, reveal its trade secrets or take a position that puts him in competition with Pei Wei. That could be a breeze, given that the concept’s direct competition is usually characterized as local Chinese restaurants.
Pei Wei is widely regarded as one of the more promising concepts to come out of the fast-casual boom in the first half of the decade. More recently it’s been battered by the same sales slowdown that has stymied chains at the higher end of their respective segments' price range.
Because Pei Wei is more of an everyday kind of place than a special-occasion option, some of us have viewed its sales problems as a reflection of the public’s shift back to cooking at home.
But at least Owens will have a fair amount of change to spend on dining out.
The money is being paid in one lump sum. In addition, all stock options or other equity awards were vested immediately, according to the agreement, which was detailed in an SEC document filed on Christmas Eve.
In exchange, Owens agreed not to sue Chang’s, reveal its trade secrets or take a position that puts him in competition with Pei Wei. That could be a breeze, given that the concept’s direct competition is usually characterized as local Chinese restaurants.
Pei Wei is widely regarded as one of the more promising concepts to come out of the fast-casual boom in the first half of the decade. More recently it’s been battered by the same sales slowdown that has stymied chains at the higher end of their respective segments' price range.
Because Pei Wei is more of an everyday kind of place than a special-occasion option, some of us have viewed its sales problems as a reflection of the public’s shift back to cooking at home.
But at least Owens will have a fair amount of change to spend on dining out.
Tuesday, December 23, 2008
More (sea) changes at the top
This morning brought the news that Greg Burns, a leader of the O’Charley’s dinnerhouse chain for 25 years, will step down early next year as CEO and chairman. It’s the latest indication that a changing of the guard is quietly taking place in the restaurant industry as executives who spent a lifetime in the business surrender the helm to newer and presumably more mainstream talent.
O’Charley’s said it hasn’t yet chosen Burns’ successor. But look at some of the replacements that have been named for exiting long-timers. Nigel Travis is stepping into the CEO’s job at Dunkin’ Donuts’ parent company with deep experience in internet sales, international business and retail marketing. The internet wasn’t even known when the standout he’s succeeding, Jon Luther, was starting his career.
Wendy’s had a long tradition of putting operational specialists in the corner office, starting with Dave Thomas, continuing through the legendary Jim Near and the highly respected Gordon Teeter, and then ending with Jack Schussler. Leading the company since its acquisition by Arby’s owner is Roland Smith, a veteran of the golf, bowling, soft drink and pharmaceutical industries. He’s a West Point grad.
Not all of the long-timers exiting top posts are being followed by newcomers with such extensive resumes. Dick Frank, for example, is surrendering his leadership of Chuck E. Cheese to Mike Magusiak, a protégée and longtime exec of the pizza-and-games chain. But Magusiak has a background in finance, having served as CFO. Frank was hailed for his operational and marketing know-how.
And not all the replacements have been named yet. Big Boy, for instance, said it’s still searching for a replacement for Tony Michaels, its longtime leader and an even longer-time veteran of the restaurant industry, including stints with Marriott.
The list of other industry greybeards to step down in recent months include Russ Owens, the casual-dining vet who had been leading P.F. Chang’s Pei Wei Asian Diner fast-casual operation; and Paul Motenko and Jerry Hennessey, the co-founders of BJ’s, who have left the board of that seemingly recession-resistant frontrunner to rev up for a new venture.
I’d be remiss if I didn’t note the counter-current of long-timers getting back into the business. Yesterday, for instance, the new owners of Romano’s Macaroni Grill released the stunning news that the chain would now be led by Olive Garden vet Brad Blum, a brilliant move on the buyer’s part. And Ned Lidvall, perhaps best known for his leadership of Rock Bottom Breweries, will now be leading Friendly’s.
O’Charley’s said it hasn’t yet chosen Burns’ successor. But look at some of the replacements that have been named for exiting long-timers. Nigel Travis is stepping into the CEO’s job at Dunkin’ Donuts’ parent company with deep experience in internet sales, international business and retail marketing. The internet wasn’t even known when the standout he’s succeeding, Jon Luther, was starting his career.
Wendy’s had a long tradition of putting operational specialists in the corner office, starting with Dave Thomas, continuing through the legendary Jim Near and the highly respected Gordon Teeter, and then ending with Jack Schussler. Leading the company since its acquisition by Arby’s owner is Roland Smith, a veteran of the golf, bowling, soft drink and pharmaceutical industries. He’s a West Point grad.
Not all of the long-timers exiting top posts are being followed by newcomers with such extensive resumes. Dick Frank, for example, is surrendering his leadership of Chuck E. Cheese to Mike Magusiak, a protégée and longtime exec of the pizza-and-games chain. But Magusiak has a background in finance, having served as CFO. Frank was hailed for his operational and marketing know-how.
And not all the replacements have been named yet. Big Boy, for instance, said it’s still searching for a replacement for Tony Michaels, its longtime leader and an even longer-time veteran of the restaurant industry, including stints with Marriott.
The list of other industry greybeards to step down in recent months include Russ Owens, the casual-dining vet who had been leading P.F. Chang’s Pei Wei Asian Diner fast-casual operation; and Paul Motenko and Jerry Hennessey, the co-founders of BJ’s, who have left the board of that seemingly recession-resistant frontrunner to rev up for a new venture.
I’d be remiss if I didn’t note the counter-current of long-timers getting back into the business. Yesterday, for instance, the new owners of Romano’s Macaroni Grill released the stunning news that the chain would now be led by Olive Garden vet Brad Blum, a brilliant move on the buyer’s part. And Ned Lidvall, perhaps best known for his leadership of Rock Bottom Breweries, will now be leading Friendly’s.
Tuesday, November 25, 2008
WANTED: New Pei Wei president
All of you out-of-work restaurant execs, get your resumes to Alice Elliot ASAP. Her company is handling the search for a successor to Russell Owens, who's stepping down next month as president of Pei Wei Asian Diner, the fast-casual little sister of P.F. Chang's. His resignation was announced this morning.
It's probably not a job for the faint of heart. Chang's has been taking its lumps from Wall Street, along with almost every public restaurant company. Shares are trading at roughly half the annual high of $33. And your mission, the company said, is president is "to bring Pei Wei to the next level of growth and profitability." Capital is frozen and restaurant spending is depressed by an historic degree. At least the statement didn't mention leaping tall buildings at a single bound.
You can see the official announcement here.
It's probably not a job for the faint of heart. Chang's has been taking its lumps from Wall Street, along with almost every public restaurant company. Shares are trading at roughly half the annual high of $33. And your mission, the company said, is president is "to bring Pei Wei to the next level of growth and profitability." Capital is frozen and restaurant spending is depressed by an historic degree. At least the statement didn't mention leaping tall buildings at a single bound.
You can see the official announcement here.
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