December 4th QSR Roundup: Fast Food Legal Battles and Health Crises Shape the Future of Dining Experiences

QSR news for Dec 4rd, 2024. We reviewed 21 QSR publications, 6 subreddits, and over 116 articles to bring you the latest. Estimated reading time saved (at 200wpm): 390 minutes. It'll take you only 10 minutes to catch up.

Legal Battles Shaping the Fast Food Landscape

Smalls Sliders Takes on Smashburger Over Trademark Claims

Smalls Sliders has initiated legal action against Smashburger, alleging trademark infringement and unfair competition. The core issue revolves around:

• Logo Similarities: Smalls Sliders claims Smashburger's new orange-themed logo closely mirrors their own established branding, leading to potential consumer confusion.
• Demands:
  • Cease use of the contested logo.
  • Destroy all materials featuring the logo.
  • Seek damages, including profits from the alleged infringement.

Smashburger acknowledges the lawsuit and is reviewing the allegations. This case underscores the critical importance of protecting intellectual property in the fiercely competitive fast-food industry.

Sources:

• QSR Magazine
• Restaurant Business

Health and Safety Concerns in Dining

McDonald's E. coli Outbreak Officially Concluded

After a comprehensive investigation, federal agencies have closed the case on the E. coli outbreak linked to McDonald's Quarter Pounders. Key points include:

• Impact: 104 infections across 14 states, 34 hospitalizations, and one death.
• Source Identified: Tainted slivered onions from Taylor Farms.
• McDonald's Response:
  • Swift removal of onions from all locations.
  • Temporary halt of Quarter Pounder sales.
  • Resumed operations with a new onion supplier.

The outbreak led to a substantial sales decline, with traffic dropping over 30% in Colorado. McDonald's is investing over $100 million to support affected franchisees and regain customer trust, including a $35 million marketing campaign.

Food Recalls Surge During Holiday Season

As holiday gatherings increase, food safety concerns rise with several recalls:

• Costco's Kirkland Eggs: Recalled due to potential salmonella contamination affecting over 10,800 packages.
• SunFed Cucumbers: Linked to an outbreak sickening 68 people across 19 states.

Consumers are urged to stay informed about recalls to ensure safe festivities.

Sources:

• QSR Magazine
• Restaurant Business
• Salon

Revamping the Dining Experience: Innovations and Comebacks

Pizza Hut Unveils Modern Prototype with Drive-Thru

Pizza Hut is redefining fast-food dining with a new restaurant design in Plano, Texas:

• Customer Convenience:
  • Drive-thru lane with a 'Hut 'N Go' menu for quick pickups.
  • Self-service kiosks and contactless pickup cabinets.
  • Open kitchen design showcasing pizza preparation.
• Sustainability Focus:
  • Energy-efficient lighting and appliances.

This initiative aims to enhance customer experience and revive in-store traffic amid declining same-store sales.

BurgerFi Sold Amid Financial Struggles

BurgerFi has been acquired by TREW Capital Management for a $10 million credit bid:

• Challenges Faced:
  • Financial strains from rising costs and declining sales.
  • Reduction of corporate-owned stores to 17.
• Previous Moves:
  • Acquired Anthony’s Coal Fired Pizza & Wings for $161 million.
  • Significant losses leading to store closures and a Chapter 11 filing.

Chi-Chi's Plans a Nostalgic Comeback

After two decades, Chi-Chi's is set to reopen, rekindling fond memories:

• Leadership Revival:
  • Michael McDermott, son of the founder, spearheads the return.
  • Focus on honoring the legacy while modernizing the menu.
• First Locations:
  • Planned openings in Minnesota, Chi-Chi's birthplace.

Once a Tex-Mex favorite with over 200 locations, Chi-Chi's closed after a hepatitis A outbreak in 2003. The comeback aims to blend nostalgia with modern appeal.

Sources:

• QSR Magazine
• Restaurant Business
• Nation's Restaurant News

Technology and Automation Transforming Dining

Automated Boba Tea Revolution on College Campuses

Dartmouth College embraces beverage automation with Botrista's automated drink machine:

• Features:
  • Customizable boba tea ready in under 20 seconds.
  • Addresses labor constraints and ensures consistency.
• Market Demand:
  • 86% of college students desire boba on campus.
  • Reflects a significant opportunity to meet student preferences.

Botrista is expanding rapidly, emphasizing commitment to automation and simplified operations.

Smart Refrigeration Solutions Combat Food Waste

Restaurants are adopting smart refrigeration to tackle food waste:

• Benefits:
  • Monitors food usage and prevents spoilage.
  • Reports a waste reduction of 4.1% per month, saving approximately $500 per location.
• Features:
  • Remote monitoring for proactive temperature management.
  • Option to rent before committing fully.

This innovation promotes sustainability and operational efficiency, opening avenues like grab-and-go coolers and chilled vending machines.

Sources:

• Restaurant Business
• FSR Magazine

Expanding Dining Options and Market Shifts

Convenience Store Fare Competes with Fast Food

A notable shift in dining preferences sees:

• Over 50% of U.S. consumers viewing convenience store prepared food as an alternative to fast food chains.

Key Factors:

• Value for Money: Attracts cost-conscious consumers.
• Variety and Accessibility: Expanded offerings provide diverse on-the-go options.
• Quality Perception: Improved food quality enhances appeal.

Fast-food chains may need to adapt offerings to retain loyal customers amidst this competition.

C3 Enhances Theme Park Dining with Diverse Options

SeaWorld and Busch Gardens partner with C3 to elevate visitor dining:

• Offerings:
  • Around 40 quick-service concepts like Krispy Rice and Umami Burger.
  • Pop-up events featuring celebrity collaborations (e.g., Toma with Sofia Vergara).
• Strategic Importance:
  • Food sales contribute nearly 50% of revenue.
  • Nearly 17 million visitors in the first nine months highlight significant foot traffic.

The partnership aims to provide flexible grab-and-go options, improving guest experiences.

Sources:

• Restaurant Business

Leadership Changes and Strategic Investments

Red Robin Secures $8.3 Million from Activist Investors

Red Robin receives a financial boost to reduce debt and enhance operations:

• Investor Influence:
  • JCP Investment Management and Jumana Capital Partners gain two board seats.
  • Aimed at strengthening the balance sheet and supporting growth.
• Strategic Moves:
  • Revamped menu and cooking processes.
  • Additional staffing to improve service.

The investment reflects confidence in Red Robin's turnaround strategy amidst financial challenges.

Portillo’s Welcomes New COO to Drive Expansion

Tony Darden joins Portillo's as COO, effective December 9:

• Experience Highlights:
  • Over 30 years in multi-unit restaurant operations.
  • Previous roles at Jack in the Box, Mooyah Burgers, and Panera Bread.
• Initiatives:
  • Improving drive-thru times.
  • Piloting self-service kiosks.
  • Overseeing the opening of the first 'Restaurant of the Future' with efficient design.

Portillo's aims to expand to 920 locations nationwide, enhancing efficiency and customer experience.

Industry Leadership Shifts in November

Significant changes across the restaurant industry include:

• CEO Departures:
  • Subway, CKE Restaurants, and Salad and Go see leadership changes.
• New Appointments:
  • Chipotle secures a permanent CEO.
  • Promotions at Red Lobster, Wendy’s, Jack in the Box, and others enhance operational leadership.

These shifts reflect the dynamic nature of the industry as companies adapt to evolving market conditions.

Sources:

• Restaurant Business
• QSR Magazine
• Nation's Restaurant News

Trends in Consumer Preferences and Dining Experiences

Health-Conscious Dining Gains Momentum

Toastique's Success in Healthy Lifestyle Dining

Founded by Brianna Keefe in 2018, Toastique offers:

• Menu Highlights:
  • Gourmet toasts, bowls, and collagen-infused drinks.
  • Emphasis on fresh ingredients and beautiful presentation.
• Growth:
  • Generated over $1 million in the first year.
  • Expanded to 14 states, fostering community involvement through local partnerships.

Toastique's dedication to wellness and transparency makes it a unique dining destination.

Convenience Store Food as Fast Food Alternative

As previously highlighted, consumers are embracing convenience store food:

• Reflects a trend towards quick, accessible, and varied meal options.
• Challenges traditional fast-food chains to innovate and adapt.

Sources:

• QSR Magazine
• Restaurant Business

Resurgence and Acquisition of Legacy Brands

Wings N' More Acquired by Goode Partners

Private-equity firm Goode Partners acquires Wings N’ More Restaurants LLC:

• Growth Plans:
  • Expand the Buffalo-style wing chain within Texas.
  • Leverage Goode's previous successes, like growing Chuy's from 8 to 75 locations.
• Founder Background:
  • Mark Dennard, former NFL player, founded Wings N’ More in 1986.

The investment aims to tap into the popularity of wings and extend the brand's reach.

Chi-Chi’s Restaurant Making a Comeback

As previously discussed, Chi-Chi's plans to reopen after two decades, blending nostalgia with modern dining to attract a new generation of customers.

Sources:

• Restaurant Business
• Nation's Restaurant News

Holiday Specials and Celebrations in Dining

National Cookie Day Brings Sweet Deals

On December 4, various eateries celebrate with special offers:

• Milk Bar: Free limited-edition Candy Cane Pretzel Bark Cookie for the first 100 customers.
• Subway: Free cookie coupons for MVP Rewards members.
• Great American Cookies: Buy One, Get One free on the Original Cookie Cake.
• Chip City Cookies: Free cookie for app users ordering on National Cookie Day.
• Insomnia Cookies: Complimentary Classic cookie for Rewards Members.

These promotions add a festive flair to the holiday season.

Feast of the Seven Fishes at Ferraro’s Ristorante

• Event: Five-course seafood feast on December 24 for $145 per person.
• Menu Highlights:
  • Seared scallops, lobster risotto, and choice of entrée like Scottish salmon.
  • Festive atmosphere for holiday celebrations.

Sources:

• Restaurant Business
• FSR Magazine

Sustainability and Eco-Friendly Initiatives in Food Production

Innovative Canola Protein Partnership

Burcon NutraScience Corp and Puratos collaborate to develop:

• Puratein Canola Protein: An alternative to egg protein in baked goods.
• Benefits:
  • Neutral flavor suitable for various applications.
  • Comparable nutrition to eggs.
  • Cost-effective ingredient.

This partnership aims to redefine canola protein's potential in the food industry.

Illinois Leads in Biomanufacturing Innovation

The Illinois Fermentation and Agriculture Biomanufacturing (iFAB) Tech Hub receives $51 million:

• Goal: Enhance sustainable food production through biomanufacturing and precision fermentation.
• Impact:
  • Repurpose 30% of Illinois corn used for ethanol into valuable food ingredients.
  • Position Illinois as a global hub for eco-friendly food solutions.

Sources:

• Food Business News

Supply Chain Concerns and Market Volatility

Proposed Tariffs Pose Risks to Agriculture

• Potential Tariffs:
  • 25% on Mexican and Canadian imports.
  • 10% on Chinese goods.

Implications:

• Price increases for consumers.
• Cost hikes for farmers and manufacturers.
• Retaliatory tariffs could adversely affect US agriculture, repeating past challenges.

Egg Market Volatility Resurfaces

Egg prices fluctuate due to:

• HPAI Outbreaks:
  • Loss of 2.8 million layers in October.
  • Impact on cage-free egg supply, especially in states with exclusive cage-free regulations.
• Price Spikes:
  • Wholesale prices reached 446 cents per dozen, a significant increase from previous years.

Supply and demand dynamics, along with disease outbreaks, contribute to ongoing volatility.

Sources:

• Food Business News
• Food & Wine

Cultural and Culinary Traditions During the Holidays

Oyster Traditions in Charleston

• Seasonal Delicacy:
  • November marks the start of oyster season.
  • Family traditions revolve around oyster roasts during holidays and football games.
• Cultural Significance:
  • Reflects the region's Gullah Geechee heritage.
  • Symbolizes familial bonds and passing down traditions.

Pasteles: A Puerto Rican Christmas Staple

• Cultural Dish:
  • Labor-intensive tamale-like dish made with plantains or yuca.
  • Filled with savory meats and wrapped in banana leaves.
• Tradition:
  • Families gather to prepare pasteles, fostering community and connection.
  • Symbolizes gifts during the holiday season.

Sources:

• Eater

Fast Food Promotions and Collaborations

Domino's Teams Up with 'Squid Game'

• Promotion:
  • Domino's Emergency Pizza at 'Squid Game: The Experience' event.
  • Lowest-scoring players receive free pizza for a year.
• Engagement:
  • Immersive experience with challenges based on the hit series.
  • Reinforces Domino's bold marketing strategies.

Taco Bell's Super Bowl Ad Campaign

• Innovation:
  • Installing drive-thru camera stations for customer engagement.
  • Rewards program members can take photos for a chance to feature in the Super Bowl ad.
• Goal:
  • Increase customer traffic and brand engagement.
  • Move away from celebrity-driven campaigns.

Sources:

• Networld Media Group
• Restaurant Dive

Trends in the Beverage Industry and Dining Formats

Top Drink Trends for 2024

• Moderation Movement: Rise of low- and no-alcohol beverages.
• Emerging Flavors: Licorice as a standout flavor.
• Nostalgic Influences: 90s-inspired vibrant drink styles.
• Barrel Aging and Craft Distilleries: Expansion of barrel-aged beverages showcases craftsmanship.

The Case for Bowls Over Plates

• Dining Shift:
  • Bowls are becoming a preferred dishware, from casual to formal settings.
  • Represent kindness and abundance, offering comfort and ease during meals.

Sources:

• Food & Wine

Additional Highlights and Noteworthy Updates

• Andy's Frozen Custard Expands in Texas: Opening two new locations with festive flavors.
• Carl's Jr. Reaches 400 Restaurants in Mexico: Continues global growth.
• Starbucks Launches 'Starbucks for Life' Game: Offers exciting prizes for Rewards members.
• Informa TechTarget Launch: Industry Dive merges to form a new company, expanding editorial reach.

Sources:

• Pizza Marketplace
• QSR Web
• Nation's Restaurant News
• Restaurant Dive

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