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.

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.

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.

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.