November 16th QSR Roundup: Restaurants Innovate Amid E. Coli Scare and Evolving Consumer Preferences for Healthier Dining

QSR news for Nov 16th, 2024. We reviewed 21 QSR publications, 6 subreddits, and over 44 articles to bring you the latest. Estimated reading time saved (at 200wpm): 175 minutes. It'll take you only 8 minutes to catch up.

McDonald's Facing Challenges and Festive Cheer 🎄

E. coli Outbreak Response

McDonald's is investing over $100 million to support franchisees after an E. coli outbreak linked to its Quarter Pounders. The outbreak resulted in 104 reported cases, including 34 hospitalizations and 1 death. The CDC traced the source to slivered onions from Taylor Farms. Following the news, some locations experienced a traffic decline of up to 32.6% year-over-year. To regain customer trust, McDonald's plans to introduce a new value platform in Q1 2025 and continue food innovation.

Festive Collaborations and Holiday Happy Meals

Despite recent challenges, McDonald's is spreading holiday cheer:

• Festive Collaboration: Partnering with Doodles for the "GM Spread Joy" holiday campaign starting November 18. Limited-edition McCafé cups featuring custom artwork unlock unique digital experiences via the app. Each cup purchase allows users to collect digital wearables and animated content.
• Holiday Happy Meals: Launching on November 26, promoting sharing among children. Each meal includes two Pet Simulator toys, inspired by the popular Roblox game with 11.6 billion plays. Kids can customize the toys with holiday stickers, embodying the spirit of giving.

Sources: QSR Magazine, Restaurant Dive, QSR Web

Innovative Customer Engagement: Loyalty Programs and Social Media Campaigns 📲

McAlister's Loyalty Program Innovation

McAlister's has crafted an innovative loyalty program with over 5.4 million members. By training staff to recognize and engage differently with loyalty members, they offer personalized experiences, exclusive perks, and surprise treats like cookies. This approach has increased customer satisfaction and value scores, showing that enhanced service can boost attendance without relying on discounts. Overwhelmingly positive feedback since rollout has made it a model for other brands.

Dutch Bros' Passenger Princess Campaign

Dutch Bros is tapping into the viral #passengerprincess trend on TikTok and Instagram:

• Offering a Crown Straw Topper with drink purchases after 5 p.m. on November 18, coinciding with National Princess Day.
• Engaging digital audience with 2.8 million mobile orders and 67% of transactions handled via the app.
• Planning in-store giveaways and promotions to maintain customer connection and capitalize on social media trends.
• Continuous growth with 38 new shops added in the third quarter.

Sources: QSR, QSR Magazine

Restaurant Expansion and Milestones 🎉

Taziki's Mediterranean Cafe Reaches 100 Locations

• Celebrating its 100th location nationwide, with the fourth Dallas-area restaurant set to open in Las Colinas.
• Marking its 10th anniversary in Dallas, owner Benny Farzad expresses gratitude towards the community's support.
• Founded in 1998 after an inspiring trip to Greece, aiming to serve fresh Mediterranean dishes while engaging with local communities.

Rusty Taco's Fresh Vision

• Rusty Taco, operating over 30 locations in 13 states, is undergoing transformation under new president Daniel Smith.
• Smith's five key priorities include realigning support, enhancing franchisee engagement, repositioning marketing, reevaluating the menu, and creating a compelling franchisee business model.
• Changes involve replacing 80% of the support team and introducing new menu items like the Sunrise Slammer breakfast burrito.
• Aiming to support franchisees through better communication and data insights.

A&W Expansion Plans in Wisconsin

• A&W Restaurants plans to expand in Wisconsin with new locations in Milwaukee and Madison.
• CEO Kevin Bazner highlights the brand's heritage and successful community engagement.
• Over 850 locations nationwide, with a franchise owner sharing a deep familial history with A&W.

Sources: Fast Casual, QSR Magazine, QSR Web

Technological Innovations Transforming Restaurants 🤖

Bojangles Kiosks Expansion

Bojangles partners with Grubbrr to install self-ordering kiosks in over 800 restaurants, achieving over 50% customer adoption in pilot tests. The kiosks will streamline operations, reduce wait times, and improve order accuracy. This joins other tech advancements like the AI drive-thru voice system. Bojangles is also expanding rapidly, aiming for 1,000 units with multiple franchise deals, including 30 in Los Angeles County and 20 in Phoenix.

Leveraging Technology for Enhanced Customer Experiences

Restaurant owners are embracing technology to enhance efficiency and customer experiences. Key points include:

• Streamlining operations through tech investments that solve specific issues.
• Feedback systems, such as gamified customer surveys, significantly increase response rates.
• Successful restaurants balance high tech with low touch, ensuring human interaction remains a priority.
• Automation is utilized for inventory control and customer interactions, but hospitality cannot be sacrificed.
• Employee involvement is essential; educating staff on the benefits of new technology prevents turnover.

Sources: Restaurant Dive, Networld Media Group

Holiday Promotions and Limited-Edition Treats 🎁

Limited-Edition Holiday Treats

• Flipz introduces Peppermint Hot Cocoa and Snickerdoodle pretzels, available at major retailers.
• Bimbo Bakeries launches Little Bites Hot Cocoa with Marshmallow Muffins in a four-pack box.
• Barilla unveils winter-themed Snowfall pasta with snowflakes, poinsettias, and hearts, celebrating shared meals during the holiday season.

KFC’s Holiday Candle Launch

KFC partners with Homesick Candles to launch holiday scents: a Bucket of Chicken candle and a Buttery Biscuit candle. A car freshener is also available. The chicken candle boasts notes of chicken, peppercorn, and herbs, while the biscuit candle features honey, butter, and vanilla. This follows KFC’s previous scent marketing efforts like sunscreen and fire logs. Additionally, KFC introduces a $25.99 Festive Feast and offers exclusive holiday rewards to loyalty members.

Sources: Food Business News, Nation's Restaurant News

Financial Performance and Market Changes 📈

Cracker Barrel's Strong Q1 Amid Proxy Battle

• Reported positive Q1 same-store sales, outperforming the casual dining competition.
• Expected net income of $4.8 million and adjusted EBITDA of $45.8 million, a 4.3% year-over-year growth.
• CEO Julie Felss Masino highlighted strong momentum from the strategic transformation plan.
• Facing a proxy contest with activist investor Sardar Biglari, which could impact the ongoing $700 million transformation plan.

Restaurant Market Share Surges

• Restaurants' market share reached a record 56.4% in October.
• Retail sales up 0.4% month-over-month and 2.8% year-over-year.
• Increased office attendance expected to boost weekday dining traffic, critical for recovering foot traffic lost during the pandemic.

Sources: FSR Magazine, Nation's Restaurant News

Operational Strategies for Profitability 💡

Key Factors for Restaurant Profitability

• Systems: Serve as the operational backbone; streamlined processes can lead to a 3% reduction in food costs.
• Consistency: Vital for customer loyalty; fluctuating service can damage reputation and drive customers away.
• Culture: A supportive work environment improves morale and stability; ultimately cutting costs on training and turnover.
• Leadership: Essential for direction and motivation; strong leadership aligns team goals for better profitability.

Revisiting these foundational elements can lead to significant changes in restaurant performance.

Thriving Amid Rising Costs

Food manufacturers are facing significant pressures due to increasing costs, inflation, and shrinking demand. Key findings include:

• 25% increase in the all-food Consumer Price Index (CPI) from 2019 to 2023.
• Redefining strategies focused on optimizing revenue, costs, and capital through proactive network consolidation and operational efficiency.
• Establishing a Project Management Office (PMO) is essential for successful implementation of changes.
• Throughput optimization can potentially increase output by 15% through process improvements and managerial training.

Companies must navigate market volatility while maximizing profits and improving overall efficiency.

Sources: Total Food Service, Food Industry Executive

Industry Mergers and Acquisitions 🤝

Wonder Acquires Grubhub

On November 13, Wonder announced its acquisition of Grubhub to enhance its food delivery platform and expand its offerings. With new investments totaling $250 million, Wonder aims to dominate the Northeastern U.S., planning to grow from 30 to 90 locations by 2025. Founded by Marc Lore, Wonder's model includes 'multiple restaurants at once' from shared kitchens, promising an innovative delivery experience.

Primo Brands Merger Announcement

Primo Water Corp. and BlueTriton Brands have merged to form Primo Brands Corp., a leader in the branded beverage market. CEO Robbert Rietbroek emphasizes the company's strong portfolio, efficient distribution networks, and commitment to delivering exceptional products. The merger combines recognized brands like Primo Water, Poland Spring, and Crystal Springs, positioning Primo Brands for accelerated growth in North America.

Sources: Eater, Food Business News

Food Trends and Culinary Inspirations 🍽️

Mango Magic: Culinary Tips

• Mangoes are a summer staple in India, with over 1,000 varieties celebrated for their unique flavors and textures.
• A family favorite pickle, tok-jhal aamer achaar, is made from tart mangoes, salt, turmeric, and a spice mix, left to mature in the sun for enhanced flavor.
• Mango chutneys are versatile; chef Chintan Pandya suggests a sweet and sour version that complements snacks and grilled dishes.
• Creative zero-waste recipes like mango peel kashundi, a tangy relish using offcuts, and beverages like aam panna.
• Mangoes also find their place in savory dishes like fish curry, showcasing their adaptability in Indian cuisine.

Thanksgiving Main Course Alternatives

Thanksgiving doesn't have to revolve around turkey every year, with a plethora of delicious alternatives to elevate your feast:

• Wholesome options: Salmon recipes that bring a light and fresh taste to the table.
• Hearty feast: Succulent pork shoulder recipes that guarantee satisfaction.
• Showstopper: Prime rib roasts that will impress your guests and provide a hearty meal.
• Vegetarian delights: A wide variety of vegetarian recipes to cater to all diets.

Embrace new flavors and make your Thanksgiving dinner unforgettable with these enticing main course alternatives.

Sources: Eater, Food & Wine

Insights from Restaurant Owners: Reddit Discussions 💬

Cash Discount Impact

The discussion revolves around the effectiveness of offering cash discounts in restaurants:

• Notable increase in cash payments: Some restaurant owners reported a significant increase in cash transactions after implementing cash discounts.
• Communication is key: Owners emphasized that verbally promoting the cash discount while providing totals can positively influence customer payment choices.
• Mixed results on cash sales: While some found no substantial change, others noted that the majority of customers still opt to use credit cards.
• Financial complaints lessen: Fewer complaints about credit card fees when offering the discount instead of an added charge.

Overall, consensus leans towards minimal change in cash sales but highlights varying customer reactions based on restaurant type.

Control Over Cocktail Service

A GM of a brewery restaurant faces a dilemma as the establishment transitions to incorporating liquor:

• Training Importance: Proper training can prepare servers to handle liquor service effectively.
• Control Concerns: Necessity of maintaining strict control over liquor service to prevent inconsistencies and waste.
• Financial Implications: Liquor sales represent substantial profit; dedicated bartenders may be needed to manage drinks accurately.

The GM is left to weigh the advice, balancing the desire for a smooth implementation of a liquor program against the need for control and training.

Sources: /r/restaurantowners, /r/Restaurant_Managers

Stay tuned for more concise news updates delivered right to your fingertips, saving you valuable time. As industry professionals and restaurant operators, your time is precious—spent on running your businesses, innovating menus, and enhancing customer experiences. Let us keep you informed with quick, comprehensive summaries so you can focus on what you do best. Subscribe now and join us again for the latest insights in the restaurant industry!