November 27th QSR Roundup: Exploring Tech Adoption Gaps, Brand Revivals, and Leadership Changes

QSR news for Nov 27th, 2024. We reviewed 21 QSR publications, 6 subreddits, and over 102 articles to bring you the latest. Estimated reading time saved (at 200wpm): 330 minutes. It'll take you only 8 minutes to catch up.

Restaurant Tech Adoption Lagging Behind

Despite the buzz around AI and technology in major chains like Chipotle and White Castle, the restaurant industry is slow to adopt these innovations.

• 90% of restaurants are independents with tight margins, making tech investments tough.
• AI usage in restaurants is only at 16-50%, far behind other sectors.
• McKinsey reports a jump from 33% to 65% in businesses using AI for at least one function.
• Most restaurants use AI for marketing, neglecting operational improvements.
• High costs from big tech firms limit AI access for smaller players.
• Entrepreneurs face challenges entering the restaurant tech market due to profitability demands.
• The "Ten-Dimension Rating Scale" shows many tech initiatives score low on readiness and market access.
• Independents can start small with affordable AI tools like ChatGPT to boost efficiency.

Source: QSR Magazine

Brand Revivals: Old Favorites Make a Comeback

Iconic chains like Ground Round, Souplantation, Sweet Tomatoes, and Steak & Ale are re-emerging, tapping into nostalgia and changing consumer trends.

• Timing is Key: Market dynamics favor revivals.
• Nostalgia Factor: Consumers crave comfort foods from the past.
• Innovative Strategies: Modern twists make old brands new again.
• Market Opportunity: The restaurant sector is rebounding post-pandemic.
• Consumer Interest: There's excitement around familiar dining options amidst increasing competition.

These revivals reflect the industry's resilience and adaptability.

Source: Restaurant Business

Leadership Shake-ups in Major Chains

Subway CEO Transition

• John Chidsey is retiring as Subway CEO after five transformative years.
• Carrie Walsh, Subway’s president of EMEA and former global CMO, steps in as interim CEO.
• Under Chidsey, Subway focused on profitability and guest satisfaction, leading to its sale to Roark Capital for $9.6 billion.
• Walsh aims to continue the brand's growth and enhance the guest experience.

Source: Restaurant Business, Food Business News

Jack in the Box Restructures

• COO Tony Darden is leaving amid company restructuring.
• Ryan Ostrom, the chief marketing officer, takes over operational duties.
• Ostrom aims to enhance customer-centric strategies and has initiated digital transformations, including self-order kiosks.

Source: Restaurant Dive

Restaurant Operators Voice Operational Challenges

Restaurant owners share their pain points:

• License Renewals: Multiple licenses are cumbersome, particularly in states like Rhode Island.
• Staff Management: Acting as HR and counselor adds stress.
• Technology Overload: An influx of tech discussions that don't address core operational needs.

There's a shared frustration over administrative burdens and a desire for solutions that genuinely assist daily operations.

Source: /r/restaurantowners

Catering Surge During the Holidays

Restaurants are capitalizing on the booming demand for catering services:

• 90% of businesses plan to order catering this season.
• Killer Burger introduces 'party-in-a-box' with Mix & Match Pint Burgers.
• Asian Box sees corporate catering as key to maintaining relationships.
• Angry Chickz expects significant revenue boosts with their spicy offerings.
• World Wrapps anticipates a 30% increase in catering sales as offices reopen.

Catering is not just an additional revenue stream but also a way to strengthen brand loyalty and awareness.

Source: Nation's Restaurant News

Ghost Kitchens Resurgent: Delivery-Only Models Return

Brands like Starbucks, Taco Bell, and Jack in the Box are revisiting ghost kitchens:

• Utilizing CloudKitchens to explore delivery-only concepts.
• Adapting to changing dining habits where convenience is crucial.
• Potential revitalization of a sector previously considered declining.

This move indicates a renewed interest in maximizing reach with minimal physical footprint.

Source: Restaurant Business

Thanksgiving Dining Trends and Insights

• 37% of consumers planned to order takeout or delivery for Thanksgiving, up from 32% last year.
• Only 5% dined in at restaurants, a decrease from 17% the previous year.
• 31% preferred fast food for their Thanksgiving meal.
• Reasons include ease (75%), similar costs to cooking (32%), and preference for professional cooking (22%).
• Restaurants like Denny’s and Cracker Barrel offered special Thanksgiving meals.
• New traditions are forming around ordering in for convenience, with spending averaging $170.

Source: Restaurant Dive

Technology Innovations: Self-Service and AI

Bojangles Embraces Kiosk Technology

• Rolling out self-service kiosks in about 25 locations.
• Benefits:
  • Enhanced customer engagement.
  • Customized orders and quicker service.
  • Addresses labor shortages by reallocating staff efforts.
• Kiosks expected to increase check averages as online orders typically generate higher revenue.

Source: Networld Media Group

Self-Service Innovation Summit Preview

• Event scheduled for December 9-11 in Tampa.
• Focus on AI and technology reshaping the food industry.
• Panelists emphasize:
  • Embracing flexibility and innovation.
  • Aligning technology with real operational challenges.
  • AI's role in automation and improving employee productivity.

Source: Networld Media Group

Supply Chain and Product Launches

Koch Foods Expansion

• Investing $145.5 million to expand in Morton, Mississippi.
• Creating 128 jobs over five years.
• Supported by the Mississippi Flexible Tax Incentive (MFLEX).

Source: Food Business News

Tyson Foods' Dallas Cowboys Nuggets

• Launches star-shaped nuggets promoting the Dallas Cowboys.
• For every purchase, $1 donated to The Salvation Army, up to $100,000.
• Available at select retailers and AT&T Stadium.

Source: Food Business News

Menu Innovations and Holiday Offerings

Krispy Kreme's Grinch Doughnuts

• Merry Grinchmas Doughnut Collection inspired by Dr. Seuss.
• Introducing new creations like the Grinch Doughnut and Grinchy Claus Doughnut.
• Aims to boost holiday spirit with playful treats.

Source: QSR Web

Panera's Asian Sesame Salad Returns

• Bringing back the popular Asian Sesame Chicken Salad.
• Features romaine, grilled chicken, cilantro, almonds, and wonton strips.
• Available nationwide starting at $11.69.

Source: QSR Magazine

Consumer Trends: Hot Honey and Swicy Flavors

• Hot honey leads the "swicy" (sweet and spicy) trend.
• California Pizza Kitchen debuts Nashville-style hot honey pizza.
• Local Hive releases hot honey infused with spicy peppers.
• Kellanova teams up with Mike’s Hot Honey for spicy-sweet Club’s Crackers.

Operators are getting creative to satisfy adventurous palates.

Source: Food Business News

Challenges Facing the Industry

Record Year for Restaurant Bankruptcies

• At least six more restaurants filed for Chapter 11 recently.
• Factors include:
  • Inflation leading to sales declines.
  • High debts surpassing assets.
  • The need for operational restructuring.

This reflects the challenging economic landscape for the food industry.

Source: Nation's Restaurant News

Starbucks Ransomware Disruption

• Attack on vendor Blue Yonder disrupted scheduling and backend processes.
• Company ensures all workers are paid and provides guidance.
• Customer-facing operations remain unaffected.

Highlights increased cybersecurity challenges in the industry.

Source: Restaurant Dive

Modernizing Menus: Less is More in Luxury Dining

• Luxury dining emphasizes quality over quantity.
• Smaller menus suggest exclusivity and enhance customer trust.
• Simplified choices prevent decision paralysis.
• Aligns with 2024 trends of regional and streamlined menus.
• Focus on freshness, seasonality, and local ingredients.

Chefs benefit from reduced costs and the ability to showcase their best dishes.

Source: Modern Restaurant Management

Emerging Culinary Trends for 2025

• Hawaiian Flavors: Significant rise in menu inclusion.
  • Searches for Hawaiian barbecue up 88%.
  • Mac salad searches up 523%.
• Mushrooms as Functional Ingredients: Searches for mushroom drinks up 501%.
• Unique Coffee Flavors:
  • Einspanner coffee searches up 1,145%.
  • Mojito coffee searches up 591%.

These trends are driven by user-generated content and reflect evolving consumer tastes.

Source: Food Business News

Leadership Changes and Company Updates

Another Broken Egg Cafe Names New CFO

• Brad Cameron appointed as CFO.
• Focus on innovation and collaboration to enhance the dining experience.
• His experience at Bloomin' Brands will support franchise expansion.

Source: Nation's Restaurant News

Nemco Expands Sales Team

• Adam Rosenkranz joins as national sales manager for the western territory.
• Brings nearly nine years of sales management experience.

Source: Foodservice Equipment & Supplies

Community Discussions: Operational Advice and Challenges

Issues with TouchBistro POS

• Restaurant owners express dissatisfaction with TouchBistro.
• Complaints include:
  • Poor customer service.
  • Defective equipment.
  • Operational failures leading to frustrated customers.
• Some have switched to alternatives like Toast for better support.

Source: /r/restaurantowners

Ordering Small Items for Restaurants

• Owners discuss managing orders for small supplies.
• Amazon Business Prime is a popular solution.
• Emphasis on creating structured ordering systems to avoid supply shortages.
• Some caution against subscription services due to pricing fluctuations.

Source: /r/restaurantowners

Impact of Political Decisions on the Industry

Trump's Tariff Threats

• Proposed 25% tariff on imports from Mexico and Canada.
• Potential impact on supplies like avocados, tequila, and beer.
• Restaurants may face significant cost increases.
• The industry expresses concern over supply chains and rising prices.

Source: Restaurant Business, /r/restaurant

Potential Deportations Affecting Labor

• Discussions around the reliance on immigrant labor in restaurants.
• Deportations could lead to labor shortages, especially in back-of-house roles.
• Emphasis on the need for sustainable practices and fair wages to attract workers.

Source: /r/restaurant

Innovations in the Floral Industry

• Floral Software advancements improve efficiency for florists and distributors.
• Technologies include:
  • Wholesale management tools for inventory and orders.
  • Retail solutions like POS systems and delivery management.
• Platforms like BlueCart connect suppliers with buyers seamlessly.
• The cut flower market exceeds $36 billion, growing at 5% annually.

Source: BlueCart

Consumer Behavior and Market Shifts

Matcha Shortage in Japan

• Tourists experience difficulty finding pure matcha due to global demand surge.
• Social media fuels #MatchaTok, increasing popularity.
• Environmental factors affect harvests, leading to shortages and price hikes.
• Backlash against high-volume buyers on social media platforms.

Source: Eater

Hot Honey Trends

• The sweet and spicy combination gains popularity.
• Restaurants and manufacturers are introducing hot honey products.
• Reflects consumers' adventurous tastes and desire for bold flavors.

Source: Food Business News

Holiday Dining and Consumer Spending

• Thanksgiving Day saw an uptick in takeout and delivery orders.
• Consumers find ordering in easier and often cost-effective.
• Restaurants offer special holiday menus to cater to this trend.
• Anticipation for Christmas and New Year’s Eve dining is positive, with more consumers planning to eat out.

Source: Restaurant Dive

Snack Innovations: Reinventing Classics

Snackable Baklava Revolution

• Dar Baklava introduces Snacklava, a healthier baklava snack.
• Contains 80% nuts, reducing sugar content.
• Aimed at making baklava a mainstream snack option.

Source: Food Business News

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