December 19th QSR Roundup: Dutch Bros Rapid Expansion, Whataburger's Fashion Move and Foodservice Innovations for 2025

QSR news for Dec 19th, 2024. We reviewed 21 QSR publications, 6 subreddits, and over 106 articles to bring you the latest. Estimated reading time saved (at 200wpm): 345 minutes. It'll take you only 9 minutes to catch up.

Dutch Bros Rapid Expansion and Growth Potential

Dutch Bros is on track to approach 1,000 locations by the end of the year, fueled by significant growth in mobile ordering and a strategic shift in marketing.

• Mobile Ordering Surge: In Q3, consumers made 2.8 million mobile transactions, comprising 7% of sales, with 90% of shops equipped for mobile orders.
• Loyalty Program Impact: Over 67% of transactions came from loyalty program users, increasing customer frequency by 5%.
• Operational Excellence: Achieving 95% accuracy in fulfilling mobile orders, ensuring efficient digital expansion.
• Financial Highlights: Revenue jumped 27.9% to $338.2 million, with same-store sales up 4% in Q4 2023.
• Future Plans: Dutch Bros anticipates 160 new openings in 2025, focusing on mobile enhancements and new food offerings.
• Ambitious Growth: Potential to expand to 4,000 locations, aiming for annual revenue exceeding $6 billion.

Dutch Bros is leveraging technology and customer loyalty to solidify its growth trajectory and enhance customer experience.

Source: QSR Magazine

Whataburger and Wrangler's Texas-Style Fashion Collaboration

Whataburger and Wrangler are joining forces to celebrate their Texas roots with a limited-edition fashion line launching in Spring 2025.

• The Collection: Features denim jackets, jeans, graphic tees, and caps, blending vintage and modern styles.
• Marketing Campaign: Showcases rodeo cowboys, connecting with younger generations.
• Brand Expansion: Aims to establish Whataburger further as a lifestyle brand beyond Texas.
• Availability: The 24-piece collection will be available online and at select Western retailers.

This partnership reflects a strategic move to connect with customers culturally and expand brand reach.

Source: QSR Magazine

Top Foodservice Innovations Anticipated for 2025

The foodservice industry is set for transformative changes in 2025, driven by rising costs and evolving consumer habits.

Key Trends to Watch:

• Sustainability and Transparency: With 80% of consumers willing to pay more for sustainable options, brands emphasize eco-friendly practices.
• Revamped Promotional Strategies: Utilizing discounts and limited-time offers to strengthen customer connections.
• Customization and Convenience: Prioritizing personalized packaging and take-out options.
• Targeting Millennials and Gen Z: Leveraging social media and aligning menus with younger tastes.
• Catering Market Expansion: Offering quality packaging and diverse cuisines for convenient dining.
• Strong Packaging Partnerships: Aligning sustainability with convenience to resonate with evolving values.

These trends underscore the industry's focus on adapting to consumer demands and enhancing the dining experience.

Source: QSR Magazine

KFC's New 'Saucy' Concept: A Flavorful Innovation

KFC is launching a new concept called 'Saucy', focusing on chicken tenders and an array of 11 unique sauces.

• Location: Opening in Orlando, featuring hand-breaded tenders and a variety of beverages.
• Customization Galore: Guests can mix sauces and create over 4,000 combinations.
• New Menu Items: Introducing the EZ Crispy Sandwich and Passion Fruit Refresher drinks.
• Value Pricing: A three-piece tender combo priced at $7.99, with modern ordering tech available.
• Entertainment Factor: Incorporating live entertainment to enhance dining experience.
• Expansion Plans: More 'Saucy' locations are in the works, capitalizing on sauce popularity.

KFC is spicing up its menu, aiming to attract Gen Z customers with this innovative concept.

Sources: QSR Magazine, Restaurant Business, Eater

Bain Capital Eyes Sizzling Platter for a $1 Billion Acquisition

Private equity firm Bain Capital is considering a $1 billion acquisition of Sizzling Platter, a franchisee managing over 750 locations, including Little Caesars, Jamba, and Dunkin'.

• Financial Performance: Projected to post $175 million in EBITDA for 2024.
• Growth Drivers: Impressive same-store sales growth and a diverse portfolio.
• Industry Trend: Reflects private equity's interest in franchised restaurant chains.

This potential acquisition highlights the attractiveness of franchise operations in the current market.

Source: QSR Magazine

BurgerFi Changes Hands Again Amidst Challenges

Ownership of BurgerFi has changed hands, sold to the parent company of Savvy Sliders after a bankruptcy acquisition by TREW Capital Management for $10 million.

• Reduced Footprint: Secured 85 BurgerFi units, down from 102.
• Growth Potential: Emphasizing the need to revamp their rewards program and app.
• Commitment to Quality: Focus on the 'Never Ever Program' ensuring no steroids, antibiotics, or additives.
• Strategic Goals: Optimize operations and promote multi-concept franchising.

Despite past challenges, the new ownership aims to rejuvenate the brand and capitalize on quality commitments.

Source: QSR Magazine

Franchisees Sue I Heart Mac and Cheese Over Misleading Practices

Franchisees of I Heart Mac and Cheese are suing the company for alleged misleading promises and illegal sales tactics.

• Allegations Include:
  • Overstated low startup costs and operational support.
  • Undisclosed corporate closures.
  • Inflated revenue claims and misrepresented operating costs.
  • Requirement to buy from higher-cost suppliers.

This lawsuit emphasizes the importance of transparency and fair practices in franchising relationships.

Source: Restaurant Business

Chefs Seek Work-Life Balance Beyond the Restaurant Kitchen

Many chefs are leaving hectic restaurant kitchens in search of better work-life balance.

• Career Reassessment: Exploring opportunities outside traditional settings.
• Mental Health Awareness: Industry recognizing importance of staff well-being.
• Positive Outcomes: Finding roles offering flexibility and satisfaction beyond restaurant pressures.

This shift highlights a trend towards sustainable careers in the culinary field.

Source: Restaurant Business

Olive Garden Sales Surge Thanks to Never-Ending Pasta Bowl

Olive Garden experienced a 2% same-store sales increase, driven by record interest in its Never-Ending Pasta Bowl promotion.

• Consumer Sentiment: Stronger visits from individuals earning $50,000 to $100,000.
• Promotion Success: Refills hit a new high during the 12-week offer, priced at $13.99.
• Brand Growth:
  • LongHorn Steakhouse saw a 7.5% sales boost.
  • Delivery sales via Uber now at 1.5%.
• Financial Highlights: Total sales for Darden rose 6% to $2.9 billion.

Strategic promotions and menu enhancements contribute to Olive Garden's positive performance.

Source: Restaurant Business

Highlighting Restaurant Crime Cases: A Haunting Reminder

Chilling crime cases within the restaurant industry, notably the Brown's Chicken and Speedway murders, serve as haunting reminders.

• Brown's Chicken Massacre: Seven-person murder in Chicago; took nine years to solve.
• Indiana Speedway Murders: Abduction and murder of four young crewmembers; case unsolved after 46 years.
• Safety Concerns: Urgent need for crime protection in vulnerable areas.

These stories underscore the importance of safety measures in the restaurant sector.

Source: Restaurant Business

Decline in Fast-Food Appeal Due to Traffic and Value Concerns

Consumers are turning away from fast-food restaurants in 2024, primarily due to traffic and value issues.

• Rising Prices: Increased restaurant prices lead to consumer frustrations.
• Need for Revitalization: Restaurants must rejuvenate interest and address pricing concerns.
• Industry Insights:
  • Experts discuss these challenges.
  • National Restaurant Association addresses various industry struggles.

Reflects a shift in consumer expectations and need for strategic adjustments by fast-food chains.

Source: Restaurant Business

Surge in Restaurant Chain Bankruptcies in 2024

The year 2024 saw a significant rise in restaurant chain bankruptcies, with over 30 chains seeking debt protection.

• Notable Bankruptcies:
  • Red Lobster closed over 100 locations.
  • TGI Fridays faced bankruptcy after managerial missteps.
• Financial Pressures: Poor decisions and soaring costs led to declining sales.
• Investor Opportunities: Investors capitalized on distressed assets.

Highlights challenges faced by the restaurant industry in a difficult economic climate.

Source: Restaurant Business

Starbucks Unionization Efforts Intensify

Starbucks Workers United successfully organized the headquarters store, escalating tensions between union and management.

• Possibility of Strike: Workers express frustrations over conditions and lack of negotiations.
• Broader Trend: Reflects industry-wide movement toward unionization.
• Workers' Demands: Seeking better pay and workplace conditions.

Signifies a significant step in labor organization within the industry.

Source: Restaurant Business

New Year Brings an Array of Mouthwatering Menu Items

Restaurants celebrate the new year with exciting menu offerings.

• Burger King:
  • Reintroduces BK Melts and Churro Fries.
• Wayback Burgers:
  • Features the Spicy Melt and Garlic Romano Fries.
• Dave’s Hot Chicken:
  • Debuts Top-Loaded Fries.
• Others:
  • Pincho Burgers, Honeygrow, Taco Cabana, Denny’s, and more present new seasonal dishes.

These innovations aim to entice customers seeking new flavors and festive options.

Source: Restaurant Business

FTC Exempts Restaurants From New Fee Rules

The FTC's new "Junk Fees Rule" mandates fee transparency for hotels and live-event tickets but excludes restaurants, marking regulatory relief.

• Industry Relief: Exemption prevents potential cost burdens.
• National Restaurant Association: Extensive lobbying efforts contributed to the exemption.
• Rule Details: Requires inclusion of fees in total pricing, not banning them.

Allows restaurants to continue current pricing practices without additional burdens.

Source: Restaurant Dive

Taco Bell Introduces Limited-Time Chicken Nuggets

Taco Bell adds chicken nuggets to its menu starting Dec. 19, 2024, available until at least Jan. 22, 2025.

• Product Details:
  • Marinated in jalapeño buttermilk with tortilla chip breading.
  • Served with Hidden Valley Fire Ranch Sauce.
• Pricing:
  • $3.99/$6.99 for five/ten-piece orders.
  • Combos range from $5.99 to $10.99.
• Strategic Move: Leverages popularity of chicken; limited-time offers boost sales.

Taco Bell innovates its menu to attract customers seeking new flavors.

Source: Restaurant Dive

Grubhub Agrees to $25 Million Settlement Over Misleading Practices

Grubhub agrees to a $25 million settlement with the FTC and Illinois Attorney General over accusations of misleading diners.

• Allegations:
  • Misleading delivery costs.
  • Misrepresented driver earnings.
  • Improperly listing restaurants without consent.
• Settlement Terms:
  • Increased transparency in fees.
  • Better communication regarding subscriptions.
• Recent Scrutiny: Follows similar issues with other delivery platforms.

Reflects ongoing regulatory attention to fairness in food delivery services.

Sources: Restaurant Dive, Nation's Restaurant News

New York Tackles Reservation Black Market with Anti-Piracy Act

Governor Kathy Hochul to sign the Restaurant Reservation Anti-Piracy Act, curbing the black market for reservations.

• Legislation Purpose: Target unauthorized groups selling reservations for profit.
• Consumer Impact: Ensures fair access without exorbitant prices.
• Support: Assemblymember Alex Bores emphasizes fairness.

Addresses reservation scalping, promoting fair dining experiences.

Source: Eater NY

Subway UAE Introduces Flavorful Local Fusion

Subway UAE partners with Excellence Hot Sauce, infusing local culture with bold flavors.

• New Menu Items:
  • Fresh & Furious: Crispy chicken bites with hot sauce and chips.
  • Wahed Sub Laham: Beef Philly steak with melted cheddar.
  • Fery Good, Fery Nice: Crispy chicken with hot sauce.
• Marketing Strategy: Blends nostalgia with innovation, resonating with the community.

Showcases commitment to regional tastes while leveraging global presence.

Source: Food & Beverage

Employee Retention Strategies in Food and Beverage Industry

High turnover rates in the food and beverage industry impact productivity and costs, highlighting the need for effective employee retention strategies.

• Generational Differences:
  • Millennials and Gen Z: Value flexibility and purpose.
  • Older Generations: Seek stability.
• Retention Approaches:
  • Fostering communication.
  • Providing continuous learning.
  • Promoting work-life balance.
  • Retaining legacy knowledge.

Enhances workforce cohesion and adapts to industry evolution.

Source: Food Industry Executive

Innovative Trends Transforming Restaurants in 2025

Several innovative trends are set to transform the restaurant industry.

• Solo Dining Surge: 29% increase in solo dining reservations.
• Smart Menus: Dynamic menus adapt to demand.
• Budget Luxury: Accessible premium experiences.
• Immersive Experiences: Tech-enhanced dining merges profit with creativity.
• AI Utilization: AI revolutionizes kitchen and guest experiences.
• Sustainability Focus: Emphasis on sustainable packaging and ingredients.
• Dynamic Pricing: Adjusting prices based on real-time demand.

These trends highlight adaptation to technology and changing preferences.

Source: RestaurantSpaces

Grubhub's $25 Million FTC Settlement Over Deceptive Practices

Grubhub will pay $25 million after an FTC investigation revealed deceptive practices involving delivery costs.

• Key Findings:
  • Misled consumers about fees.
  • Blocked accounts with gift card balances.
• Settlement Requirements:
  • Provide full delivery costs upfront.
  • Obtain consent from restaurants.
• Company Response: Grubhub maintains innocence but settles.

Emphasizes importance of transparency in food delivery industry.

Source: Nation's Restaurant News

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