February 13th QSR Roundup: Chili's Revenue Surge, New Menus, and Navigating ICE Inspections

QSR news for Feb 13th, 2025. We reviewed 21 QSR publications, 6 subreddits, and over 107 articles to bring you the latest. Estimated reading time saved (at 200wpm): 155 minutes. It'll take you only 14 minutes to catch up.

Chili's Outpaces McDonald's with Revenue Surge

Chili's reported a remarkable 30% rise in comparable store sales, showcasing the strength of their brand experience and distinctive menu offerings. In contrast, McDonald's faced challenges with negative traffic counts, despite pushing value through discounts. This indicates a shift in diner preferences towards quality over low prices.

• Casual Dining Growth: The Casual Dining segment is witnessing a 1.5% increase in customer visits, attracting mid- to higher-income consumers away from traditional Quick Service Restaurants (QSR).
• Price Gap Diminished: Aggressive price increases have narrowed the gap between QSR and higher-tier dining, leading customers to consider trading up to Fast Casual options.

Key takeaway: Today's diners prioritize quality experiences and unique menu items over discounted prices.

Source: QSR Magazine

Potbelly Introduces New Menu Delights

Potbelly is expanding its menu with two permanent additions debuting on February 17:

• Chili Mac: A hearty blend of beef chili, kidney beans, bell peppers, and Potbelly's signature three-cheese mac. This comforting dish pairs perfectly with their sandwiches or salads.
• Banana Pudding Shake: Creamy vanilla and banana flavors blended with premium hand-dipped ice cream, topped with a shortbread cookie.

These new offerings build on Potbelly's reputation for craveable sides and complement their established sandwich lineup. Last year, they introduced new sandwiches like the Cubano and Sweet Heat Pork BBQ, along with four bold sauces.

Looking ahead: Potbelly plans more innovative additions throughout 2025, aligning with their campaign, "We’re bringing MORE to the table."

Source: QSR Magazine

Little Caesars Franchisee Honored for Exceptional Leadership

Taylor Johns, a third-generation Little Caesars franchisee, has been named the 2024 Franchisee of the Year by the International Franchise Association (IFA). Leading 16 locations in South Carolina, Johns exemplifies outstanding leadership and a strong commitment to his community.

• Community Service: Actively participates in charitable initiatives like the Love Kitchen after Hurricane Helene and organizes Toys-for-Tots donations.
• Team Culture: Fosters a positive and strong team environment across his franchises.

This award recognizes franchise owners who excel in community service and leadership, highlighting the significant impact franchisees have locally.

Source: QSR Magazine

Burgerville Unveils Delightful New Menu Items

This February, Burgerville introduces six limited-time offerings to tantalize taste buds:

• Orange Dream Shake: A refreshing blend of orange juice and organic vanilla syrup, creating a creamy, dreamy treat.
• Stumptown Mocha Perk Shake: A coffee-infused delight perfect for caffeine lovers.
• JoJo Potato Wedges: Crispy potato wedges seasoned to perfection, starting at $4.59.
• Spicy Crispy Chicken Sliders: Mini sandwiches packed with flavor, available with a choice of savory sauces.

These items are available from February 18th to April 7th (with the Mocha Shake available until April 19th). Don't miss out on the Country Fried Chicken Biscuit for a hearty breakfast option, served only in the mornings.

Source: QSR Magazine

Dutch Bros Targets the Morning Crowd

Dutch Bros is enhancing its morning offerings with a new limited food test and expanding mobile ordering:

• CEO Christine Barone emphasizes goals of employee satisfaction, effective food options, and maintaining throughput.
• Current Stats: Food accounts for less than 2% of total sales, with plans to boost this for increased morning traffic.
• Early Feedback: The food test shows promising results as the chain adapts to customer demands.

Mobile ordering is gaining popularity, with a significant increase in transactions. Dutch Bros plans strong growth, expecting 150 new shop openings and revenue increases in 2025, following a 32.6% revenue growth in 2024.

Source: QSR Magazine

Navigating ICE Inspections in the Restaurant Industry

The restaurant sector, a major employer of foreign-born workers, faces heightened scrutiny from ICE. Preparing for potential workplace inspections is crucial to avoid legal and reputational risks.

Key Steps for Compliance:

• Regular Audits: Conduct routine I-9 audits to ensure all employee documentation is up to date.
• Retention of Records: Keep I-9 forms for at least three years after hiring.
• Staff Training: Designate a manager as the point of contact with ICE, and train employees on their rights and appropriate responses.
• Warrant Awareness: Understand the difference between administrative and judicial warrants; only judicial warrants allow ICE access beyond public areas.
• Emergency Preparedness: Develop a response plan, including legal counsel contacts and practice drills.
• Documentation: During inspections, stay calm, verify warrant legitimacy, and document all ICE actions.

Post-Inspection Actions:

• Legal Consultation: Immediately consult with legal professionals to assess any risks.
• Staff Communication: Be transparent with employees about their rights and any new protocols.

By preparing thoroughly, restaurants can navigate ICE inspections with minimal disruption.

Source: QSR Magazine

Popeyes Enhances Advertising and Modernizes Operations

Popeyes Louisiana Kitchen franchisees are increasing national advertising spending and focusing on operational improvements:

• Advertising Increase: Raising national advertising spend from 4.5% to 5% of sales, aiming for 5.5% by the third year.
• Royalty Credits: Franchisees receive $4,000 in royalty credits per store to offset initial costs.
• Modern Remodel Rollout: Expected completion by 2030, enhancing brand image and service speed.
• Operational Challenges: Despite popularity from the Chicken Sandwich, same-store sales have been inconsistent.
• Upgrades: Investing in kitchen upgrades and technology to improve experiences and efficiency.
• Profitability: Average Popeyes location generated $255,000 in profits last year.

Key Focus: Improving operations is crucial for sustained growth, aiming to replicate the success of the Chicken Sandwich launch.

Source: Restaurant Business

Burger King's Plan to Boost Profitability and Modernize Stores

Burger King is revitalizing its brand and improving franchisee profitability through key initiatives:

• Leadership Vision: CEO Kobza highlights success stories like franchisees increasing sales by 30% after revamping underperforming restaurants.
• Profitability Trends: Average profitability in 2024 reached $205,000 per store, with top operators exceeding $275,000.
• Turnaround Goals: Targeting average profitability of $230,000 by 2026, aiming ultimately for $300,000.
• Modernization Efforts: Initiated 370 store remodels last year; plans for 400 more in 2025.
• Investment: Over $2 billion invested to enhance operations, including a $1 billion acquisition.
• Franchisee Strategy: Shifting towards franchisees managing fewer than 50 units, expanding from 300 to 400-500 franchisees.
• Marketing and Menu Innovation: Focus on family dining and unique promotions, driving a 1.5% rise in same-store sales in Q4.

Source: QSR Magazine

Starbucks Cuts Menu Complexity to Boost Efficiency

Starbucks has reduced its menu by 30%, reflecting a trend towards operational efficiency over variety. Large menus can hinder:

• Customer Satisfaction: Overwhelming choices lead to decision fatigue.
• Employee Morale: Complex menus increase training burdens.
• Operational Costs: Streamlined offerings reduce waste and simplify supply chains.

By focusing on curated, high-quality items, Starbucks aims to enhance the customer experience and improve efficiency.

Source: QSR Magazine

Dave’s Hot Chicken Explores Potential $1 Billion Sale

Dave’s Hot Chicken is considering a sale valued at approximately $1 billion, working with investment bank North Point.

• Rapid Expansion: Grown to over 250 locations globally since 2017.
• Celebrity Investors: Backed by Drake and Samuel L. Jackson.
• Growth Plans: Opened around 80 new locations in 2024, plans to match that in 2025.
• Pipeline Goal: Aiming for 1,000 units in development.
• Industry Trend: Reflects increased private equity interest in restaurant franchises.

Source: QSR Magazine

Denny's Plans to Close Up to 90 Additional Restaurants

Denny’s is increasing its planned closures to improve overall performance:

• Up to 90 Closures: 30 more than previously expected.
• Underperforming Locations: Average unit volume under $1.1 million, operating over 30 years.
• Focus on Growth: Aiming to open 25-40 new restaurants in 2024.
• Recent Performance: Despite a 1.1% sales increase, facing challenges from weather and inflation.
• Strategic Moves: Emphasizing value offerings and virtual brands to boost sales.
• Remodeling Impact: Updated locations show potential 6.5% sales increase, with a new loyalty program planned.

Source: Restaurant Business

The Growing Demand for Protein-Rich Foods

Protein is increasingly popular, especially among those using weight-loss drugs like Ozempic. Major chains are adapting:

• Panda Express and Smoothie King are integrating more protein-rich options.
• Consumer Perception: Higher protein intake is linked to health benefits.
• Industry Implication: Restaurants adjusting menus to include more protein meet this demand.

Source: Restaurant Business

Winter Menu Highlights: New Seasonal Offerings

Restaurants and convenience stores introduce enticing new items:

• 7-Eleven: BOGO Breakfast Tacos for $1.
• RaceTrac: Taco Pizza with beef crumbles and taco sauce.
• Krispy Krunchy Chicken: New Chicken Nuggets with five sauce options.
• Red Lobster: Lobsterfest with 10 lobster dishes until April 20.
• Arby's: Surf 'n Turf pairing fish sandwiches with Beef ‘N Cheddar for $6.99.
• Wendy's: Thin Mints Frosty arriving on February 21, partnering with Girl Scouts.
• Cracker Barrel: Seasonal specials like Strawberry Cheesecake Pancakes.
• Fazoli’s: Lasagna Rolls in four variations, starting at $5.99 until late April.

These offerings cater to varied tastes, building excitement for upcoming seasons.

Source: Restaurant Business

Franchise Valuations Under Scrutiny

Crumbl and Dave’s Hot Chicken are reportedly on the market, potentially facing scrutiny over their rapid expansion valuations. These sales will test investor confidence in emerging franchise opportunities.

Source: Restaurant Business

Restaurant Menu Prices Show Signs of Easing Inflation

• January Increase: Menu prices rose 0.2%, showing signs of easing inflation.
• Comparison with Grocery Prices: Rise is less than half of the 0.5% increase in grocery prices.
• Yearly Comparison: Restaurant prices up 3.4% over the year; grocery prices up 1.9%.
• Egg Prices: Notable spike with egg prices soaring 15.2% month-over-month, 53% over the year.
• Operator Strategies: Facing a value war to attract customers amid these trends.

Insight: Inflation influences dining decisions, with restaurants adjusting strategies to remain competitive.

Source: Restaurant Business

Tropical Smoothie Café Strengthens Leadership Team

Tropical Smoothie Café announces three key executive appointments:

• Jonathan Biggs as Chief Operating Officer (COO).
• Chris Sasser as Chief Financial Officer (CFO).
• Karen Wickliffe as General Counsel.

Following its acquisition by Blackstone for $2 billion, the café boasts 13 consecutive years of same-store sales growth, with new menu items like the Dragon Fruit Bowl.

Source: Restaurant Business

Red Robin's Chief Marketing Officer Departs

Kevin Mayer, Red Robin's CMO, has left to pursue other opportunities. Since joining in May 2023, Mayer:

• Implemented a New Loyalty Program: Enhancing customer engagement.
• Strengthened Local Marketing: Improved community connections.

His departure comes during a key turnaround phase, with Red Robin recently seeing a 3.4% increase in same-store sales.

Source: Restaurant Business

Strategic Insights on Revitalizing Restaurant Chains

Jim Greco, CEO of Tijuana Flats, shares strategies for turning around struggling chains:

• Enhance Operations: Improve efficiency and customer satisfaction.
• Invest in Marketing: Attract and retain customers effectively.
• Maintain Food Quality: Ensure high-quality offerings to keep patrons returning.

His successful turnarounds at Bruegger’s and Sbarro highlight the importance of strategic leadership.

Source: Restaurant Business

In-N-Out Burger Announces Corporate Office Restructuring

In-N-Out plans to close its Irvine office by 2029:

• Relocation: Staff to move to Baldwin Park or a new office in Franklin, Tennessee.
• Expansion Plans: Opening restaurants outside the West Coast in Nashville, supported by a new facility in Lancaster, Texas.
• Cultural Values: Owner Lynsi Snyder emphasizes family values guiding future decisions.
• Employee Impact: Approximately 500 team members work in the Irvine office.

Source: Restaurant Business

Dutch Bros Reports Exceptional Sales Surge

Dutch Bros experienced strong growth in Q4:

• Same-Store Sales Increase: Up 6.9%.
• Loyalty Program Success: 71% of transactions from loyalty members, totaling 5.4 million transactions.
• Mobile Orders: Wide acceptance boosted customer frequency.
• Stock Performance: Shares jumped over 20% after the sales report.
• Expansion: Operating 950 shops, exploring expanded food menus.

Source: Restaurant Business

The Rise of Solo Dining Trends

Valentine’s Day 2025 sees an increase in solo diners:

• 81% of Americans seeking new dining experiences.
• Nearly 50% of New Yorkers dine alone for self-care.
• Restaurants Adapt: Tailored experiences for solo diners, like designated tables and customized menus.
• Staff Engagement: Key to welcoming solo guests.
• Technology Support: Advanced systems optimize operations for seamless experiences.

By embracing these changes, restaurants attract repeat customers and cater to evolving preferences.

Source: FSR Magazine

Ted's Montana Grill Introduces New Smashburger

Starting February 17, Ted’s Montana Grill rolls out a new smashburger:

• Options: Choose between beef or bison patty.
• Ingredients: Diced red onions, Ted’s Seasoning, American cheese, homemade pickles, and ranch onion dip.
• Sides: Served with hand-breaded onion rings and French fries.

This offering enhances the dining experience with bold flavors.

Source: FSR Magazine

Bloomin’ Brands Welcomes New Board Member

Bloomin’ Brands adds James (Jim) Dinkins to its Board of Directors:

• Board Expansion: Membership increases to 11.
• Role: Will serve on the Audit Committee.
• Background: CEO at The Honey Baked Ham Company LLC; former executive at The Coca-Cola Company.

Dinkins brings over 40 years of experience in brand strategy and consumer engagement.

Source: FSR Magazine

CasaDamí Brings European Charm to Newport Beach

Opening on March 1, CasaDamí offers:

• Ambiance: Custom Italian marble bar and floral-draped patio.
• Menu: Pastries, salads, tapas, and premium coffee.
• Wine Selection: Curated by collector Dave Shah, featuring prestigious brands.
• Dining Transformation: Café by day, full-service dining by night.
• Operating Hours: Open 8 a.m. to 10 p.m. daily.

CasaDamí captures the essence of European all-day dining in a coastal community.

Source: FSR Magazine

The Importance of Branding in the Restaurant Industry

Branding is crucial in creating unforgettable guest experiences:

• Menu Design: Texture and typography impact perception.
• Visual Storytelling: Decor and artwork enhance ambiance.
• Consistent Elements: Promote lasting connections with guests.
• Strategic Planning: Align branding with core values and guest experience goals.

Focusing on impactful branding elements yields the best results.

Source: FSR Magazine

Reinventing Classic Cocktails with Modern Flavors

Restaurants are giving classic cocktails a modern twist:

• Margot Bar & Bistro: Offers a guanabana-infused mojito.
• Crane Club: Combines classic flavors with innovative techniques.
• Lazy Betty: Features unique drinks like a fat-washed old fashioned.

This trend blends nostalgia with innovation, enhancing the overall experience.

Source: FSR Magazine

Innovative Seafood Dining Experiences Emerge

Restaurants redefine seafood dining:

• Four Seasons Resort Hualalai: Introduces Ulu and Noio, focusing on local produce and rare seafood.
• Chef Richard Polhemus: Enhances poke with Japanese bluefin.
• Miami's SHINGO: Offers 18-course Omakase menus with high-quality fish.

Sustainability Emphasis: Chefs prioritize sustainable sourcing to ensure future seafood availability.

Source: FSR Magazine

Wendy's Targets Growth Through Innovation and Value

Wendy's plans expansion by 2025:

• Menu Innovation: Expanding chicken and beverage categories.
• Value Offerings: New two-for-$7 meal deal reinforces value proposition.
• Breakfast Sales: Rose by 6%, with ongoing menu updates.
• Loyalty Program: Expanded to 46 million members, with exclusive deals.

In Q4, Wendy's posted a 4.1% same-store sales increase in the U.S.

Source: Restaurant Dive

Chili's Launches Margarita Campaigns to Boost Engagement

Chili's unveiled new campaigns targeting different audiences:

• "Ride the ‘Dente'": For NASCAR fans, featuring the Presidente Margarita.
• "I’ll be Home for National Margarita Day": A Lifetime special airing on Feb. 19.
• Financial Growth: Experienced a 26.45% annual revenue growth, reaching $1.36 billion.

Plans include redesigning 200 stores and promoting cultural events to appeal to diners.

Source: Restaurant Dive

California Pizza Kitchen Embarks on Strategic Expansion

• 40th Anniversary: Celebrating in 2025.
• Growth Focus: Non-traditional units and vending machines to offset labor costs.
• Airport Expansion: In 12 airports, with 38 proposals pending.
• Virtual Brand Partnership: With Man Vs Fries, offering burritos and quesadillas.
• Domestic Franchising: Adding 3-4 franchisees annually.

Expecting about 10 new units in 2023, with accelerated growth by 2026.

Source: Restaurant Dive

SNAP Cuts Proposed in Congressional Budget Raise Concerns

• Deep Cuts Proposed: Republicans advance plans for significant cuts to SNAP.
• $230 Billion Target: Savings aimed at impacting food assistance amid other expense increases.
• Potential Rollbacks: Could reverse recent SNAP benefit increases and adjust work requirements.
• Community Response: Advocates argue cuts will worsen food insecurity.
• Political Debate: Democrats criticize the cuts, emphasizing support for vulnerable communities.

Source: Civil Eats

Shifting Consumer Preferences in Bread Consumption

• Decline in Traditional Bread: Consumers moving away from white and wheat loaves.
• Healthier Options Favored: Increased interest in keto, gluten-free, and organic products.
• Brand Growth: Dave’s Killer Bread and Nature’s Own Perfectly Crafted seeing unit gains.
• Weight-Loss Drugs Impact: Potential influence on bread consumption patterns being studied.

Source: Food Business News

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