November 4th QSR Roundup: Job Growth Slowdown, Mergers and Employee Empowerment

QSR news for Nov 4th, 2024. We reviewed 21 QSR publications, 6 subreddits, and over 41 articles to bring you the latest. Estimated reading time saved (at 200wpm): 140 minutes. It'll take you only 16 minutes to catch up.

October Job Growth Slowdown

October saw a significant dip in restaurant job growth, adding fewer than 4,000 new jobs compared to over 39,000 in September. This slowdown reflects broader economic challenges impacting the sector.

• Starbucks is reintroducing strict product testing to enhance their menu creation.
• BJ’s Restaurants attempted the Pizookie Pass promotion, which boosted traffic but hurt profits, leading to a strategic rethink.
• Tender Greens and Tocaya emerged from bankruptcy under new ownership, though details remain limited.

Sources: Nation's Restaurant News

Dine Brands Enhances Employee Benefits

Dine Brands is revolutionizing employee benefits to transform long-term careers in the restaurant industry, challenging the notion of restaurant jobs as merely temporary.

• Parent Transition Program offers remote work flexibility for family-building.
• Expanded supports include adoption assistance, fertility support, and six weeks paid time off for non-birthing parents.
• Tuition reimbursement has been doubled, responding to young professionals' feedback.
• High employee engagement with 30% participation in resource groups.
• An impressive 81% satisfaction rate with initiatives promoting financial wellness and belonging.
• Leadership pathways and individual development plans are now available, showcasing career growth potential exemplified by Christie Cook's rise from server to HR VP.

Sources: Nation's Restaurant News

M&A Growth in QSR

The quick-service restaurant (QSR) industry is poised for a surge in mergers and acquisitions (M&A) by 2025, driven by rising strategic technology needs.

• Pent-up demand and recent Fed rate cuts could lower loan prices below 8%, enhancing M&A valuations.
• QSRs thrived during the pandemic but faced slowed M&A activity due to inflation and interest rate hikes since 2022.
• Q1 2024 has already seen 70 food and beverage deals.
• Buyers are advised to set clear goals and thoroughly research potential targets, while sellers should keep their financials updated and invest in technology before selling.

Sources: QSR Magazine

Twin Peaks Spin-Off

Fat Brands is spinning off Twin Peaks into a separate public company, Twin Hospitality Group, with shareholders receiving 5% of the new entity.

• Twin Peaks operates 115 locations with an average unit volume of $5.3 million.
• Despite a 0.2% decline in same-store sales in 2023 and a 3.9% drop in 2024, Fat Brands sees massive growth potential.
• Plans include converting 60 Smokey Bones locations to Twin Peaks, targeting expansion to 650 locations.
• CEO Andy Wiederhorn remains optimistic about future growth despite recent sales challenges.

Sources: Restaurant Business

Lessons from Hotel Chefs

Hotel chefs are redefining success by focusing on creating fulfilling work environments and balancing culinary creativity with operational efficiency.

• Chef Jacob Sessoms emphasizes a culture that promotes team contentment beyond accolades.
• Intentional productivity and simplified menus increase dish sales and reduce burnout.
• Building strong relationships with local suppliers inspires seasonal menus and fosters a positive workplace, as seen with Miguel Estrada at Canopy by Hilton Cancun.
• Chef Cary Roy highlights the importance of menu flexibility to satisfy diverse guest preferences, enhancing the overall dining experience.

Sources: FSR Magazine

Roti Grill Launches New Location

Roti Grill has opened a new, more refined location at 3001 Knox Street in Dallas, TX, featuring a full-service dining experience and a cocktail bar.

• Owner Pardeep Sharma addresses the demand for sit-down Indian restaurants in DFW.
• Menu highlights include Vegetable Samosas and Chicken Vindaloo, paired with craft cocktails like the Indian Sunset.
• The vibrant, culturally inspired design by Hatsumi Kuzuu creates an immersive atmosphere.
• The new location accommodates up to 80 guests and operates daily from 11 am to 10 pm, catering to both casual diners and special occasions.

Sources: FSR Magazine

QSR Automations Investment

QSR Automations has secured a strategic growth investment from Battery Ventures, aiming to accelerate growth and innovation in restaurant technology.

• Founded in 1996, QSR is a leader in restaurant technology with its renowned ConnectSmart technology, utilized by major chains like The Cheesecake Factory.
• Robbie Payne is the new CEO, while former CEO Angela Leet transitions to a board member role.
• The investment will expand QSR's market reach and enhance their ability to deliver cutting-edge solutions that optimize restaurant operations and improve guest satisfaction.

Sources: FSR Magazine

FAT Brands Spin-Off Plans

FAT Brands is spinning off Twin Peaks and Smokey Bones into Twin Hospitality Group, a standalone public company, to focus on business growth and allow investor choice.

• Shareholders receive 5% of the new entity, while Twin Peaks aims to expand to 650 domestic and 250 international locations.
• Sales have surged, with Twin Peaks' AUV rising from $4.1M to $5.4M (2019-2023) and Smokey Bones' revenue growing from $149.1M to $172.3M.
• The combined systemwide sales increased from $342.7M to $583.4M, with adjusted EBITDA spiking from $9M to $28.3M.

Sources: FSR Magazine

TGI Fridays Bankruptcy Declared

TGI Fridays has filed for Chapter 11 bankruptcy, with liabilities estimated between $100 million and $500 million, aiming to restructure and ensure brand viability.

• Financial struggles stem from COVID-19 disruptions, liquidity issues, and a decline in U.S. store counts from 270 to 163.
• Systemwide sales fell 12.5% in 2023 to $1.4 billion, and Q1 2024 saw a $40 million revenue decline.
• A failed $220 million acquisition by Hostmore severely impacted stability, leading to Hostmore's administration and TGI Fridays losing control over critical assets.

Sources: FSR Magazine, Restaurant Dive, Modern Restaurant Management

Beverage Trends for 2024

2024 is set to be a beverage revolution year with restaurants revamping their menus to attract Gen Z and Millennials.

• Matcha is predicted to outperform 99% of other beverages over the next four years, driven by its health benefits and versatility.
• Monin’s Matcha Green Tea Concentrate simplifies traditional Matcha preparation, offering 40MG of caffeine per serving and pairing well with trendy flavors like coconut and yuzu.
• Specialty drinks are becoming highly profitable, with operators able to charge premium prices due to growing consumer interest in high-quality beverages.

Sources: FSR Magazine

Gen Z and Millennials Drive Menu Innovations

Younger generations are reshaping restaurant menus with a focus on innovative and plant-based options, influencing major culinary trends.

• Chef Mitchell Aboujamra exemplifies this trend with his Lebanese-Mexican fusion restaurant, integrating plant-based products to cater to Gen Z and millennial tastes.
• 79% of Gen Z are eager to try plant-based meals, with successful offerings like falafel and sweet potato fries.
• The key is to balance authenticity with modern dietary demands, ensuring that plant-based proteins enhance without altering the culinary identity.

Sources: FSR Magazine

EEOC Sues Culver's Operators

The EEOC has filed a lawsuit against five Culver’s operators in Michigan for alleged discrimination and retaliation against a transgender worker and three colleagues.

• The lawsuit claims that employees were misgendered and subjected to anti-trans comments, leading to their dismissal after reporting harassment.
• This action violates Title VII of the Civil Rights Act of 1964, which prohibits discrimination and retaliation.
• The EEOC underscores the responsibility of employers to maintain a harassment-free environment, especially for transgender individuals.

Sources: Restaurant Dive

El Pollo Loco's Remodeling Plans

El Pollo Loco is set to remodel nearly half of its locations over the next four years, enhancing both aesthetics and operational efficiency.

• CEO Liz Williams announced a dual investment strategy: a low-cost five-year refresh and a more extensive 10-year remodel.
• New designs feature an updated color palette, upgraded furniture, LED lighting, and energy-efficient systems to boost sales and customer experience.
• The first remodeled restaurant is expected to open by late 2024, with plans to reach its 500th location soon, supported by strategic menu innovations.

Sources: Restaurant Dive

Martha Stewart's Instagram Charm

Martha Stewart's Instagram blends glamour with authenticity, creating a unique and engaging social media presence.

• Identifiable Style: Effortlessly sophisticated posts showcasing both her upscale farm life and Hollywood glamour.
• Evolution: Transitioned from poorly lit photos to polished images, reflecting significant quality upgrades.
• Authenticity: Shares personal moments and embraces quirks, offering followers an intimate glimpse into her life.
• Community Connection: Stewart's blend of personal and glamorous content fosters a delightful community connection, standing out amidst curated celebrity feeds.

Sources: Eater, Salon

Martha Stewart Cookbook Craze

Martha Stewart’s Entertaining cookbook experiences a resurgence in popularity, driven by a new Netflix docuseries.

• Collectibility Debate: With 99 titles, Entertaining is not truly rare but has seen high demand after reissue.
• Market Trends: Current prices range from $5-$15, suggesting temporary hype.
• Demographic Appeal: Strong in blue states and among youth and 55+ demographics, with 20% of buyers purchasing multiple titles.
• Cultural Shift: Newer titles are more test-kitchen produced, altering the personal essence of earlier works.
• Influential Release: Entertaining was pivotal with its ambitious design and high-quality visuals, setting standards in the genre.

Upcoming releases like Martha: The Cookbook and a new Netflix doc are expected to reignite interest and prices.

Sources: Eater

Celebrating the Horse Girl Phenomenon

The "horse girl" identity is explored through Martha Stewart's life, highlighting her passion and dedication to horses alongside her culinary career.

• Symbol of Passion: Martha embodies the 'horse girl' identity, successfully intertwining her love for horses and cooking.
• Unique Experiences: Her equestrian lifestyle includes attending the Olympics and engaging in public appearances, enriching her personal and professional life.

Sources: Eater

Coping Through Cooking

Amid election-induced anxiety, cooking elaborate dishes offers a therapeutic escape, fostering focus and a sense of control.

• Stress Relief: Engaging in cooking projects like homemade pasta or baking bread diverts attention from election stress.
• Sense of Control: The process provides nourishment and calm amidst chaotic political climates.

Sources: Eater

Shrek Sandwich Maker Unveiled

Celebrate 23 years of Shrek with a themed sandwich maker, perfect for fans and unique holiday gifts.

• Iconic Item: A nonstick sandwich maker embodying Shrek’s character, tapping into the enduring pop culture phenomenon.
• Versatile Gift: Ideal for events like White Elephant exchanges and themed parties, appealing especially to millennials.

Sources: Eater

Caviar Uncovered

Caviar, prized for its distinct flavor and texture, remains a luxury staple in gourmet dining.

• Caviar vs. Roe: Only sturgeon roe is classified as caviar, differentiating it from other fish eggs.
• Market Size: Valued at approximately $330 million, driven by gourmet interest despite limited supply.
• Health Benefits: Rich in omega-3 fatty acids, promoting heart health, brain function, and skin vitality.
• Consumption: Typically enjoyed chilled as a garnish or spread, enhancing various dishes with its unique taste.

Sources: BlueCart

Loyalty Programs for Restaurants

Effective loyalty programs are crucial for customer retention and revenue enhancement across all restaurant types.

• Technology Integration: Over 60% of diners appreciate tech-enriched dining experiences, including contactless ordering and personalized marketing.
• Simple Strategies: Smaller establishments can implement birthday rewards or deep discount coupons to boost loyalty.
• Grassroots Marketing: Community events and social media engagement help build trust and a loyal customer base.
• Data-Driven Insights: Larger chains emphasize the importance of tech investment, data analytics, local partnerships, and consistent communication.
• Creative Features: Combining simplicity with creativity keeps customers engaged and interested in loyalty programs.

Sources: Modern Restaurant Management, /r/restaurantowners

Groundwater Crisis in Colorado

Farmers in Colorado's San Luis Valley face a dire groundwater crisis, needing to replenish aquifers within seven years to avoid mandatory well shutdowns.

• Agricultural Impact: The region is vital for agriculture, being the nation’s second-largest potato producer.
• Water Demand: Current water demand exceeds natural replenishment rates, threatening the future of local farming.
• Conservation Efforts: Innovative measures like groundwater conservation easements are being implemented to address the crisis.
• Model for Others: These efforts could serve as a blueprint for similar communities facing water shortages nationwide.

Sources: Civil Eats

Tariff Impacts on Farmers

Heightened U.S.-China trade tensions threaten to devastate U.S. agricultural exports, despite claims of beneficial policies under Donald Trump's presidency.

• Trump’s Claims: Asserts that his presidency has greatly benefited farmers, dismissing negative polling as false.
• Study Findings: The American Soybean Association warns that renewed tariffs could slash U.S. exports of soybeans by over 50% and corn by up to 90%.
• Global Competition: Brazil and Argentina may capitalize on U.S. export gaps caused by tariffs.
• Economic Consequences: A steep retaliatory tariff from China could result in U.S. farmers losing 2.9 to 4.6 million metric tons of exports annually.
• Permanent Losses: Economists caution that ongoing trade wars could lead to permanent market share losses for American farmers.

Sources: Salon

Co-Branded Dessert Launch

Famous Brands International launches a co-branded store featuring Mrs. Fields and TCBY in Pineville, NC, marking franchisee Samuel Batt's 15th opening.

• Grand Opening: Held on Nov. 3, celebrating the synergy of two beloved dessert brands under one roof.
• Community Loyalty: Samuel Batt emphasizes the local community's loyalty and product enjoyment as key to the store's success.
• Enhanced Choice: Customers can enjoy a variety of high-quality desserts in a single location, boosting convenience and satisfaction.

Sources: QSR Web

Checkers & Rally's Expansion

Checkers and Rally's continue their expansion with a new restaurant in Social Circle, Georgia, operated by franchisee Yousuf Dosani.

• Job Creation: This new location marks Dosani's fourth in Georgia, contributing to local employment and business growth.
• Brand Commitment: With 800 restaurants nationwide, the brand focuses on quality food and efficient service.
• Community Engagement: The expanded footprint aims to positively engage with local residents and strengthen community ties.

Sources: Checkers & Rally's, QSR Web

Election Day Specials?

Restaurants are exploring special promotions for Election Day, with varying experiences on whether it's busier or slower.

• Special Promotions: Ideas include themed coffee cups and carry-out specials to attract customers during evening vote counts.
• Staff Considerations: Importance of allowing staff time to vote and managing potential divisiveness.
• Mixed Experiences: Some restaurants find Election Day busier, while others remain cautious about special promotions this election year.

Sources: /r/restaurantowners

Choosing a Griddle for Smash Burgers

Restaurant owners discuss upgrading from cast iron to gas griddles for better performance in smash burgers.

• Popular Choices: Stainless steel and carbon steel griddles are favored for their versatility and cooking performance.
• Top Recommendations: Steelmade Pro Griddle for custom sizes and AccuTemp Grill for efficiency.
• Key Considerations: Size of the range and potential burger output are crucial factors in selecting the right griddle.

Sources: /r/restaurantowners

Sourdough in Pizzerias

Incorporating sourdough into pizzeria operations is debated, focusing on sustainability and consistency challenges.

• Benefits: Creates lighter, more digestible pizzas and can be marketed as a healthier option.
• Challenges: Requires proper systems, training, and space for longer fermentation times.
• Feasibility: Mixed opinions on whether the complexity is worth it, though successful integration can enhance flavor and shelf-life.
• Operational Tips: Suggestions include using a poolish, having a backup starter, and maintaining temperature control.

Sources: /r/restaurantowners

Direct Mail and Loyalty Strategies

Direct Mail combined with loyalty programs can effectively boost customer engagement and retention.

• Initial Boost: Direct Mail can enhance brand awareness, but redemption rates may decline over time.
• Successful Tactics: Implementing deep discount coupons, like '50% off for any order up to $50', to attract customers to loyalty programs.
• Enhanced Communication: Using text campaigns alongside Direct Mail increases redemption rates and customer engagement.
• Community Insights: Restaurant owners seek tailored advice based on specific restaurant types to optimize these strategies.

Sources: /r/restaurantowners

Fresh, Not Frozen Fast Food Choices

A discussion on fast-food chains known for using fresh ingredients highlights consumer preferences for fresh over frozen options.

• Popular Chains: Wendy's, Chipotle, and In-N-Out Burger are praised for their fresh offerings.
• Consumer Skepticism: Some question the emphasis on 'fresh' ingredients, noting that certain items like wagyu beef are still shipped frozen.
• Balanced View: While frozen food isn't inherently bad, many consumers prefer fresh options for better taste and quality.
• Surprising Inclusions: Some chicken chains known for using fresh chicken were unexpectedly included in the discussion.

Sources: /r/fastfood

New Dulce de Leche Frappe

McDonald's introduces a Dulce de Leche Frappe, sparking mixed reactions regarding its sweetness and health implications.

• Customer Reactions: Some enjoy the new frappe, while others express concerns about high sugar content and prefer less sweet options.
• Menu Adjustments: Local McDonald's have reduced McCafe offerings, focusing on regular and iced coffee.
• Cultural Appreciation: A celebration of dulce de leche culture adds a fun, nostalgic element to the discussion.

Sources: /r/fastfood

Hostess Tips for Beginners

New hostesses share valuable tips to create a smooth and professional hosting experience in restaurants.

• Customer Interaction: Maintain eye contact and a smile, and avoid phone distractions.
• Seating Management: Learn the seating rotation, stagger seating to prevent kitchen overwhelm, and communicate effectively with management.
• Training Importance: Emphasize proper training and maintaining a professional demeanor to handle customer needs and special accommodations.
• Collaborative Efforts: Helping servers during busy times ensures a cohesive team environment.

Sources: /r/restaurant

Waitstaff Earnings Insights

Waitstaff earnings vary significantly based on location, restaurant type, and shift dynamics, with peak shifts offering substantial income boosts.

• Earnings Range: Typically between $30 to $50 per hour, with busy nights earning even more.
• Extreme Examples: Servers report earning as low as $75 for a slow 12-hour shift versus $2,000 on bustling nights.
• Annual Earnings: Averaging between $40k to $75k, depending on hours and personal effort.
• Influencing Factors: Restaurant type, location competition, and seasonal demand heavily impact tips and overall income.

Sources: /r/restaurant

Bar Owner Q&A

Bar owners engage in a Q&A session, sharing insights and advice on various operational and business challenges.

• Employee Policies: Discussions on rules for employees drinking off-duty and managing profitable food items.
• Business Innovations: Ideas like trivia games and vending machines aimed at college students to enhance engagement and revenue.
• Aspiring Owners: Advice for those looking to take on more responsibilities and successfully run bar operations.
• Event Enhancements: Emphasis on creating engaging events to attract and retain customers.

Sources: /r/BarOwners

Magician at Bars - Yay or Nay?

The idea of having a magician at bars receives mixed feedback from bar owners and patrons.

• Entertainment Value: Some find it entertaining and enjoyable during special events, while others find it annoying or out of place.
• Event Suitability: Magic performances are more suitable for special events or family-friendly venues rather than regular bar nights.
• Quality Concerns: Ensuring the magician's experience is crucial to avoid negative impacts on the venue’s reputation.
• Alternative Entertainment: Suggestions include tarot card reading as a less intrusive form of entertainment.

Sources: /r/BarOwners

Glycol System Line Length Concerns

A bar owner discusses installing a glycol system for beer lines, addressing concerns about maintaining beer quality over long runs in hot environments.

• System Setup: Properly sized glycol systems can prevent beer spoilage, even with a 35 ft run in hot climates.
• Maintaining Quality: Critical to ensure the chiller is located in a cooler area with good airflow to avoid inefficiencies.
• Cost and Maintenance: Glycol systems have high initial costs and require regular line cleaning, which can lead to beer wastage.
• Profitable Investment: Despite costs, the profitability from maintaining beer quality justifies the investment for many bar owners.

Sources: /r/BarOwners

Employee Investment in Bars

Considering allowing employee investment in the business can increase commitment but may complicate management dynamics.

• Pros and Cons: Selling shares can boost employee commitment but make management more complex.
• Structure Recommendations: Offering phantom benefits instead of actual shares to avoid ownership complications.
• Focus on Performance: Emphasizing business performance improvements over bringing in investors unless necessary.
• Risk Management: Thorough planning is essential to mitigate potential risks associated with employee investments.

Sources: /r/BarOwners

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