December 16th QSR Roundup: Leadership Changes, Supply Chain Strategies, and Culinary Innovations for Growth

QSR news for Dec 16th, 2024. We reviewed 21 QSR publications, 6 subreddits, and over 50 articles to bring you the latest. Estimated reading time saved (at 200wpm): 175 minutes. It'll take you only 15 minutes to catch up.

Reviving the Core: Papa John's Strategic Shift

Papa John's is taking significant steps to overcome a challenging 2024:

• Sales Slump: The company faced a sales decline of 2%, 4%, and 6% over three consecutive quarters.
• Leadership Overhaul: With the departure of former CEO Rob Lynch, Todd Penegor steps in to steer the ship.
• Back to Basics: A renewed focus on the "Better Ingredients, Better Pizza" promise aims to enhance consistency and customer satisfaction.
• Simplifying the Menu: Original crust sales dwindled from 75% to just over 50%, prompting a move towards operational simplicity.
• Marketing Moves: Campaigns like Shaq-a-Roni and targeted CRM strategies have doubled loyalty program engagement from 20% to 50%.
• Tech Upgrades: A refreshed app led to a 50% increase in conversions, signaling successful digital investments.
• Franchise Collaboration: Working closely with 411 U.S. operators to boost profitability, with U.S. restaurants averaging $1.2 million AUV in 2023.
• Global Growth: Plans to expand in the U.K., China, India, and Saudi Arabia, adding to the existing 2,454 global locations.

Sources: QSR Magazine

Supply Chain Smarts: Navigating Holiday Demands

As the festive season approaches, restaurants are strategizing to avoid supply chain hiccups:

• Diversify Suppliers: Mitigate risks by not relying on a single source.
• Inventory Intelligence: Utilize advanced POS systems for real-time tracking and predictive analytics.
• Proactive Forecasting: Leverage historical data to anticipate demands and prevent stock-outs.
• Embrace Technology: Implement cloud-based systems for seamless inventory management.
• Flexible Menus: Offer modular dishes to adapt quickly to ingredient availability.
• Strong Supplier Relationships: Maintain open communication and develop contingency plans.
• Empower Staff: Train employees on new technologies and inventory practices to streamline operations.

Sources: QSR Magazine

Empowering Women: Firehouse Subs' Initiative

Firehouse Subs is fostering female leadership within its ranks:

• Global Women's Network: Launched by Restaurant Brands International with 600 members in 2023.
• Women of Firehouse Program: Initiated by Meghan Vargas to support and connect women in the company.
• Key Activities:
  • Weekly newsletters
  • Virtual meetups
  • Philanthropic efforts
• Leadership Spotlight: Mariana Marques shares strategies for success, highlighting the program's impact.

Sources: QSR Magazine

Starbucks Boosts Parental Leave

In response to employee feedback, Starbucks is enhancing its parental benefits:

• Extended Leave:
  • 18 weeks for birth mothers
  • 12 weeks for non-birth parents
• Effective Date: Changes take effect in March.
• Attracting Talent: Aimed at appealing to Gen Z workers who value paid leave.
• Additional Benefits:
  • Stock acquisition options
  • Tuition coverage for online degrees
• Industry Impact: Aligns with broader efforts to improve employee benefits amid unionization trends.

Sources: Restaurant Business, Nation's Restaurant News

In Memoriam: Ken Cole's Legacy

The restaurant industry mourns the loss of Ken Cole, a respected leader:

• Career Highlights:
  • Owned and operated Jerry’s restaurants
  • Held executive roles at Bonanza and Sizzler
  • Served as CEO for Damon’s and Quaker Steak & Lube
• Entrepreneurial Spirit: Owned Boston Beanery since 2011 and consulted for other businesses.
• Personal Life: Married to Vickie for over 51 years.

Sources: Restaurant Business

Innovating Drive-Thrus: McDonald's New Model

McDonald's introduces a game-changing restaurant design:

• "On the Go" Concept: Debuted in Los Angeles, focusing on drive-thru and digital orders.
• Features:
  • No traditional lobby
  • Food lockers for delivery pickups
  • Separate window for mobile orders
• Strategic Expansion: Part of McDonald's plan to grow U.S. locations, adding 39 new restaurants in 2023.
• Industry Trend: Follows other chains like Chick-fil-A and Taco Bell in reimagining restaurant layouts to prioritize speed and convenience.

Sources: Restaurant Business

Legal Victory: Restaurants Can Seek COVID Losses

A landmark court ruling offers hope for restaurant owners:

• North Carolina Supreme Court Decision: Restaurants can claim damages from insurers for pandemic-related losses.
• Key Points:
  • Government-mandated shutdowns are deemed "direct physical loss."
  • Policies did not explicitly exclude pandemic-related closures.
• Implications:
  • Could influence pending lawsuits nationwide.
  • Represents a potential shift in how business interruption insurance is interpreted.
• Industry Support: Backed by the North Carolina Restaurant & Lodging Association.

Sources: Restaurant Business

Cultural Fusion: Chef Eileen Andrade's Journey

Chef Eileen Andrade brings a unique culinary blend to Miami:

• Family Heritage: Granddaughter of the founder of Islas Canarias.
• Career Path:
  • Started with a food truck, Cuban Cube, at 21.
  • Opened Finka Table & Tap and Amelia’s 1931, blending Cuban and Asian flavors.
• Achievements:
  • Celebrated Finka's 10-year anniversary with special events.
  • Renovated Amelia's to pay homage to family history.
• Community Impact:
  • Advocates for the LGBTQIA+ community.
  • Mentors aspiring chefs, emphasizing passion over trends.

Sources: FSR Magazine

Activist Investors and Industry Shifts

Activist investors are influencing restaurant strategies:

• Targets: Brands like Starbucks, Potbelly, and Cracker Barrel.
• Recommendations:
  • Transition to smaller, efficient models to boost margins.
  • Embrace technology and streamline operations.
• Leadership Changes: CEOs at Starbucks and Dave & Buster’s have stepped down under investor pressure.
• Expert Advice: Boards should proactively engage with shareholders to unlock value.
• Industry Outlook: Restaurants must stay alert as activism shapes the future landscape.

Sources: Restaurant Dive

Rental Woes for Independent Restaurants

November marked a challenging time for independents:

• Record Delinquencies: 46% couldn't pay rent, up 3% from October.
• Contributing Factors:
  • Rising operational costs
  • Limited cash flow despite sales growth in major chains
• Industry Trends:
  • Traffic declined by 3.3% year-to-date.
  • Comparable sales down 0.5%.
  • Predictions of a further 2.9% traffic drop in 2025.
• Labor Costs:
  • Affected 88% of operators.
  • 51% saw increases of 1-5%.
  • 41% faced hikes of 6-14%.
• Outcome: Increased closures and bankruptcies among small restaurants.

Sources: Restaurant Dive

Instacart and Uber Eats: A Fruitful Partnership

Instacart's collaboration with Uber Eats is paying off:

• Integration: A 'Restaurants' tab in the Instacart app allows users to order meals via Uber Eats.
• Benefits:
  • Enhanced customer engagement
  • Increased app usage and spending
• Uber's Gains:
  • Basket sizes from this partnership are 20% larger than average.
• Audience Reach:
  • Attracting suburban customers and families ordering groceries.
• Growth Potential: Signals strong future expansion opportunities.

Sources: Restaurant Dive

Mo' Bettahs' Hawaii in Utah

Hawaiian restaurant Mo' Bettahs expands its Utah footprint:

• New Openings: Two locations in West Jordan and Murray, totaling 31 in the state.
• Founder's Gratitude: Kalani Mack thanks the community for their support.
• Menu Highlights:
  • Spam Musubi
  • Kalua Pig
• Mission: Share an authentic Hawaiian dining experience since 2008.

Sources: Fast Casual

Johnny Rockets Goes Global

Johnny Rockets announces major international growth:

• 2024 Expansion: 11 new international openings planned.
• Current Presence: 55% of locations are outside the U.S.
• Recent Openings:
  • 2 in Chile
  • 2 in Bali
  • 4 in Mexico
  • 2 in Brazil
• Innovative Locations:
  • Airports
  • Theme parks
• Legacy: Serving classic American fare since 1986.

Sources: Fast Casual

Global Produce Market Trends

Key insights into the booming produce industry:

• Market Valuation: $733 billion globally, growing at 5% annually.
• Consumer Preferences:
  • Rise in demand for superfoods like kale and avocados.
  • Shift towards online grocery shopping post-pandemic.
• Massive Markets:
  • Central de Abasto in Mexico City handles 30,000 tons daily.
• Sustainability Impact:
  • Consumers favoring eco-friendly and organic products.
  • Sustainability influencing purchasing decisions significantly.

Sources: BlueCart

Preparing for 2025: HR and Payroll Must-Dos

Ensure your restaurant is ready for the new year with these strategies:

• Employee Handbook Refresh: Update policies to meet new laws and communicate changes.
• Simplify Health Enrollments: Start early and provide clear guides.
• Optimize Payroll Processes: Stay compliant with wage laws and conduct regular audits.
• Recruitment and Retention:
  • Hire for cultural fit.
  • Streamline onboarding.
  • Recognize employee achievements.
• Stay Ahead of Labor Laws: Be proactive with training and compliance.
• Efficient Scheduling: Use software to adapt to sales patterns.
• Boost Engagement: Hold check-ins and set clear goals.
• Safety Audit: Review protocols to reduce workplace incidents.
• Tax Planning: Prepare for deadlines and ensure accurate filings.

By focusing on these areas, you'll enhance compliance, morale, and growth in 2025.

Sources: Modern Restaurant Management

Turning Seasonal Hires into Long-Term Assets

Strategies to retain restaurant staff beyond the holidays:

• Prioritize Flexibility:
  • Offer adaptable scheduling.
  • Reduce burnout by respecting work-life balance.
• Invest in Development:
  • Provide training and mentorship.
  • Encourage career growth within the company.
• Adapt to Demand:
  • Use AI for accurate staffing needs.
  • Ensure optimal team sizes during peak times.

By valuing employees and adapting to their needs, restaurants can build loyal, long-term teams.

Sources: Modern Restaurant Management

Reviving Buffalo's Baking Traditions

Miller’s Thumb Bakery brings fresh milling back to Buffalo:

• Early Starts: Stephen Horton begins milling at 3:30 a.m. daily.
• Local Grains:
  • Uses New York-grown Glenn and Warthog wheat.
• Signature Product: The Wonderful Loaf, a nod to Wonder Bread.
• Mission: Reconnect the community with Buffalo's rich bread-baking heritage and traditional methods.

Sources: Civil Eats

Upcoming Food Ingredient Regulations

2025 will bring significant changes to food regulations:

• FDA Initiatives:
  • Post-market assessments of food chemicals, including GRAS substances.
  • Focus on both focused and comprehensive reviews.
• State Actions:
  • California bans certain synthetic dyes and chemicals starting 2027.
• Industry Impact:
  • Potential for varying regulations across states.
  • Manufacturers face challenges in compliance.
• Economic Considerations:
  • Balancing food safety with affordability is crucial.
  • Overregulation could affect food prices and accessibility.

Sources: Food Business News

General Mills Tops Responsibility Rankings

General Mills garners prestigious recognition:

• Rankings:
  • 2nd most responsible company in America.
  • 1st in retail and consumer goods.
• Score Details:
  • Overall score of 96.85.
  • Environmental: 96.97.
  • Social: 100.
  • Corporate Governance: 93.66.
• Competitors:
  • Keurig Dr Pepper at 5th place.
  • Mondelez International at 15th.
• Consumer Influence: Encourages responsible consumer choices.

Sources: Food Business News

Health-Conscious Eating on the Rise

Recent studies show a shift in eating habits:

• Healthy Eaters Increase: 19% eat healthy "all the time," up from 16%.
• Natural Products Preferred: 40% seek "all-natural" labels, compared to 34% last year.
• Ingredient Transparency:
  • 61% prioritize ingredient lists over nutritional claims.
• Stress Influence:
  • Global issues lead to people taking control of their diets.
  • 39% opting for homemade meals.

Consumers are making deliberate choices for better health and well-being.

Sources: Food Business News

Food Trends to Watch in 2025

Expect to see diverse cuisines influencing menus:

• Global Flavors:
  • Haitian Pikliz (spicy pickled slaw)
  • Peruvian Sweety Drop Peppers
  • Chinese Chow Fun
• Unique Ingredients:
  • Pastina pasta
  • Bonito Flakes from Japan
  • Orange Wine
• Consumer Behavior:
  • 89% indulge weekly, seeking comfort in food.
  • Greater interest in cultural culinary blends.

Stay ahead by incorporating these trends into your offerings.

Sources: Food Business News

Krispy Kreme Cybersecurity Alert

Krispy Kreme responds to an IT system breach:

• Incident Date: Detected on November 29.
• Actions Taken:
  • Engaged cybersecurity experts.
  • Notified federal law enforcement.
• Operational Impact:
  • Shops remain open.
  • Some online orders disrupted.
• Financial Implications:
  • Anticipates material impact during recovery.
  • Has cybersecurity insurance to offset costs.

Sources: Food Business News

Leadership Changes at Food Lion

Key executive shifts are happening:

• New President: Greg Finchum to become president on May 2, 2025.
• Retirement: Meg Ham retires after a 35-year career.
• Finchum's Background:
  • 21 years at Food Lion.
  • Roles in retail operations and strategy.
• Company Growth:
  • Under Ham, enhanced fresh food offerings and online services.
• Broader Changes:
  • Ahold Delhaize USA revamping leadership across brands.
  • Roger Wheeler named president of Stop & Shop.

Sources: Food Business News

Spicing Up Snacks: New Ritz Flavor

Ritz introduces an exciting new offering:

• Flavor: Spicy Queso Ritz Bits.
• Taste Profile: Rich, creamy cheese with a bold kick.
• Product Launch:
  • First new bite-size snack flavor in nearly a decade.
  • Available in 3-oz bags at convenience stores.
  • 8.8-oz boxes arriving in major retailers by February 2025.

Sources: Food Business News

Pecan Milk: The New Plant-Based Trend

Pecan milk is making waves in the dairy alternative market:

• Sustainability:
  • Pecans require less water and no chemicals.
  • Supports local farmers by upcycling pecan pieces.
• Health Benefits:
  • High in flavonoids and antioxidants.
  • Promotes brain and heart health.
• Taste and Quality:
  • PKN brand perfected a frothable Barista blend after 18 months.
• Future Plans:
  • Introducing new products in 2025 with native plants for enhanced flavor.

Sources: Salon

Nulogy's Supply Chain Excellence Recognized

Nulogy wins a top industry award:

• Award: 2024 Top Software & Tech award in Supply Chain Visibility.
• Innovations:
  • Materials Visibility Module in the Supplier Collaboration Solution.
  • Materials Ordering Tool in the Shop Floor Solution.
• Impact:
  • Provides real-time data access for FMCG brands.
  • Enhances collaboration and agility in supply chains.
• CEO's Statement: Jason Tham highlights the importance of these tools in today's market.

Sources: Food Industry Executive

Urgent Call for Sustainable Food Supply Chains

DNV's report urges transformative action:

• Sustainability as Priority:
  • 75% of companies rank it above cost efficiency.
• Digital Transformation Lag:
  • Need for tools ensuring traceability and risk management.
• Regulatory Pressures:
  • New EU directives on sustainability and human rights.
• Consumer Demand:
  • Preference for sustainable products, even at higher prices.
• Action Steps:
  • Collaborate across supply chains.
  • Embrace technology for transparency.
  • Balance cost-efficiency with environmental responsibility.

Sources: Food Industry Executive

Highlights from the Restaurant Summit

Key takeaways from the upcoming event:

• Venue: Myrtle Beach from March 11-13.
• Keynote Speaker: Tabassum Zalotrawala, McDonald’s CDO.
• Networking Opportunities:
  • Beachside dinner on March 12.
• Focus Areas:
  • Leveraging AI, robotics, and data.
  • Boosting profits and improving training.
• Closing Panel:
  • CEOs from various dining establishments.
• Diversity Efforts:
  • Seeking speakers from diverse backgrounds.
• Early Bird Registration: Extended to December 20.

Sources: Fast Casual

Global Pizza Market Set to Soar

The pizza industry anticipates significant growth:

• Market Expansion: Expected increase of $66 billion from 2024 to 2028.
• Growth Rate: 6.79% CAGR.
• Driving Factors:
  • Rise of Quick Service Restaurants (QSRs).
  • Urbanization and increased disposable income in countries like India.
• Trends in India:
  • 20-25% rise in QSRs during FY 2023.
  • Chains like Domino’s and Pizza Hut expanding in smaller cities.
• Market Diversity:
  • Offerings range from traditional to gourmet pizzas.
• Positive Outlook: Supported by Technavio's comprehensive report.

Sources: Technavio Report

Little Caesars Brings Back a Fan Favorite

The Stuffed Crazy Crust returns:

• Price: Just $9.49.
• Features:
  • Crust stuffed with cheese.
  • Brushed with a garlic-butter-flavored spread.
  • Topped with parmesan cheese.
• Company Message:
  • Greg Hamilton, CMO, emphasizes value and flavor.
  • Marketed as the most affordable stuffed crust among national chains.
• Availability: For a limited time only.

Sources: Food & Beverage

Hot Dr Pepper: A Retro Holiday Treat

The classic warm beverage makes a comeback:

• Origin: Introduced in 1958 as a winter warmer.
• Preparation:
  • Heat Dr Pepper to 180°F.
  • Serve with a slice of lemon.
• Viral Resurgence:
  • TikTok videos with over 2 million views.
  • Mixed reactions, from skepticism to delight.
• Flavor Profile:
  • Notes of cinnamon and nutmeg align with holiday spices.
• Serving Suggestions:
  • Ideal as a festive, non-alcoholic option at gatherings.
  • Best made with Dr Pepper containing real sugar for enhanced taste.

Sources: Food & Wine

Forecasting Rising Food Costs in 2025

Restaurant owners brace for price hikes:

• Universal Increases: Expectation that all food costs will rise.
• Specific Concerns:
  • Avocados, beef, chicken, and produce highlighted.
• Contributing Factors:
  • Potential tariffs leading to up to a 40% price increase on imports.
  • Inflation impacting labor and operational costs.
• Industry Sentiment:
  • Skepticism about predicting exact trends due to economic volatility.
  • Importance of regular cost analysis and menu pricing strategies.
• Operational Advice:
  • Set menu price thresholds.
  • Prepare for shifts in consumer behavior.

Sources: Reddit: /r/restaurantowners

Strategies Amid Revenue Declines

Restaurant groups seek solutions to slipping profits:

• Self-Audit Approach:
  • Identifying unnecessary expenses.
  • Renegotiating supplier contracts.
• Operational Efficiency:
  • Empowering staff to take on management roles.
  • Maintaining quality service despite cost-cutting.
• Industry Challenges:
  • Rising prices and decreasing quality.
  • Financial strain in lower-income areas.
• Community Insights:
  • Importance of strong leadership.
  • Vigilance in managing finances during tough times.

Sources: Reddit: /r/restaurantowners

Customer Behavior in the Post-Pandemic Era

Restaurant owners note a shift in patron attitudes:

• Increased Rudeness:
  • Reports of more demanding and less patient customers.
• Contributing Factors:
  • Emotional strain from Long COVID.
  • Inflation and economic pressures.
  • Changes in social norms post-pandemic.
• Industry Impact:
  • Staff facing higher stress levels.
  • Challenges in maintaining customer service standards.
• Mixed Experiences:
  • Some report more understanding customers.
  • Overall trend points to heightened tensions.

Sources: Reddit: /r/restaurantowners

Debating the Value of Mexican Cuisine

Discussions on pricing and perception:

• Chef's View:
  • Silvana Salcido Esparza advocates for elevating Mexican food to the esteem of French cuisine.
• Community Opinions:
  • Some stress the need for affordability to maintain accessibility.
  • Others agree on the potential for high-end Mexican dining experiences.
• Cultural Significance:
  • Emphasis on authenticity and preserving traditional flavors.
• Market Space:
  • Room for both affordable and upscale offerings in the culinary landscape.

Sources: Reddit: /r/restaurant

Mistaken Tip Dilemma

A patron accidentally over-tips:

• Scenario:
  • Intended to tip $85 but wrote a total of $597 instead of $497.
• Advice from Community:
  • Contact the restaurant to clarify the error.
  • Policies vary, but many establishments honor the tip amount over the total.
• Industry Insight:
  • Such mistakes are common.
  • Emphasis on customer intention and satisfaction.
• Resolution Importance:
  • Open communication can easily rectify the situation.

Sources: Reddit: /r/restaurant

Steak Doneness Preferences Spark Debate

A lively discussion on how steak should be cooked:

• Diverse Opinions:
  • Some prefer well-done; others advocate for medium-rare.
• Key Points:
  • Cooking preferences are personal and should be respected.
  • Understanding different cuts of meat can influence cooking methods.
• Culinary Insights:
  • Well-marbled steaks can remain juicy even when cooked longer.
• Consensus:
  • No wrong way to enjoy a steak.
  • Restaurants should accommodate all preferences.

Sources: Reddit: /r/restaurant

Launching a Bar Co-op: Dreams and Challenges

An experienced bartender seeks to start a collective:

• Goal: Create a bar co-op with industry friends.
• Concerns:
  • Funding limitations (around $100k).
  • Navigating partnerships and profit sharing.
• Community Advice:
  • Importance of clear roles and expectations.
  • Need for a solid business plan and sufficient capital.
• Financial Realities:
  • Suggested starting budget closer to $200k.
  • Awareness of market conditions and upcoming economic shifts.

Sources: Reddit: /r/BarOwners

Insights from Bar Owners

Key questions in the bar industry:

• Mobile Ordering:
  • Interest in its effectiveness during peak times.
• Relocation Considerations:
  • Moving operations from Mexico to Texas.
  • Navigating new demographics and regulations.
• Customer Spending:
  • Average spend of 21-40-year-olds on weekends.
  • Aiming to benchmark financial expectations.

Sources: Reddit: /r/BarOwners

Bar Design: Shape Matters

Discussion on the best bar layouts:

• Preferences:
  • Straight or L-shaped bars favored for efficiency.
  • U-shaped or island bars promote social interaction if designed well.
• Operational Impact:
  • Design affects customer experience and staff efficiency.
• Considerations:
  • Bartender movement
  • Customer engagement
  • Space utilization
• Consensus:
  • No one-size-fits-all; design should suit the specific venue's needs.

Sources: Reddit: /r/BarOwners

Restaurant Innovations and Wage Hikes

Latest updates from the industry:

• McDonald's:
  • Opens "On the Go" location focusing on drive-thru and digital orders.
• Raising Cane’s:
  • Uses compelling storytelling and celebrity influence for marketing.
• Wage Increases in L.A.:
  • City Council raises minimum wage for airport and hotel workers to $30/hour by 2028.
• Lobbying Efforts:
  • Restaurant sector shows strong presence among top federal lobbyists.
• Stay Informed:
  • Listen to the Restaurant Daily podcast for more news.

Sources: Nation's Restaurant News

Domino's Offers a Slice of Relief

A creative campaign targets fantasy football fans:

• Emergency Pizza Giveaway:
  • $1 million in free pizzas for fans with injured players.
• Special Guest: NFL star Stefon Diggs.
• How to Enter:
  • Must have Diggs on your fantasy roster.
  • Sign up for Domino’s Rewards and provide proof.
• Campaign Goal:
  • Lift spirits of disappointed fans.
  • Reinforce Domino's as a fun, customer-focused brand.
• Promotion Duration: Until January 6, 2025.

Sources: Nation's Restaurant News

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