October 12th QSR Roundup: Innovative Trends and Challenges in the Restaurant Industry

QSR news for Oct 12th, 2024. We reviewed 20 QSR publications, 6 subreddits, and over 35 articles to bring you the latest. Estimated reading time saved (at 200wpm): 107 minutes. It'll take you only 10 minutes to catch up.

Leadership and Branding in the Restaurant Industry

Embracing Boldness and Empathy in Leadership

At the CREATE conference, four dynamic CEOs shared invaluable insights on branding and leadership:

• Alex Dunn of Swig focuses on maintaining a unique brand identity in the competitive 'dirty soda' market. With 50 topping options, Swig boosts customer loyalty by offering personalized experiences.
• Elisia Flores of L&L Hawaiian Barbecue emphasizes the importance of franchisee culture. She ensures that franchisees embody Hawaiian values and a community spirit, fostering a cohesive brand experience.
• Steve Kislow of Firebirds advocates for providing value through quality dining experiences instead of raising prices amid inflation. By avoiding discounting strategies, Firebirds maintains its brand integrity.
• Liz Williams from El Pollo Loco leverages organic customer promotion in new markets. She believes in harnessing social media hype over traditional influencer marketing to create authentic connections with customers.

A shared theme among these leaders is the balance of boldness and empathy—being confident in innovation while understanding and supporting their teams.

Sources:

• Nation's Restaurant News

Industry Acquisitions and Financial Moves

Darden Restaurants Expands Portfolio with Chuy's Acquisition

• Darden Restaurants has finalized its acquisition of Chuy's Holdings for $605 million, expanding its portfolio to encompass 10 brands.
• Chuy's, established in Austin, Texas in 1982, brings 101 locations across 15 states to Darden's expansive network.
• The acquisition was financed through senior notes offerings totaling $750 million, set to mature in 2027 and 2029.

TGI Fridays Faces Ongoing Closures

• TGI Fridays has closed over a dozen U.S. restaurants, particularly affecting the East Coast and Midwest regions.
• This follows a trend where the chain has closed half of its U.S. locations over the past decade due to declining consumer interest.
• Sales dropped 15% last year, and frequent leadership changes—with four different CEOs this year—have raised concerns about the chain's stability.

Rising Grocery Debt Highlights Economic Pressures

• A significant 60.5% of U.S. adults are using credit cards to purchase groceries.
• 3.5% are turning to Buy Now, Pay Later options for essential food items.
• Food prices have surged over 25% since pre-pandemic levels, exacerbating financial strain.
• Low-income families face a "hunger cliff" as SNAP benefits reduce, now averaging just $6 per person daily.

Sam's Club Introduces Checkout-Free Store

• Sam's Club is revolutionizing retail with a new location in Grapevine, Texas, eliminating traditional checkout counters entirely.
• Shoppers use the Scan & Go smartphone app to seamlessly scan and pay for items, enhancing efficiency.
• AI scanning technology at exits helps prevent theft, ensuring all purchases are accounted for.

Sources:

• Nation's Restaurant News
• Restaurant Business
• Salon

Consumer Trends and Marketing Strategies

Chili's Addresses Rising Fast-Food Prices

Chili's is capitalizing on consumer frustration with increasing fast-food prices, coining the term "McSpensive" to highlight the issue.

• The chain emphasizes its simple dress code—customers just need to be dressed—to promote an inclusive atmosphere.
• By focusing on mainstream trends and providing value, Chili's aims to connect with everyday customers without chasing fleeting fads.

McDonald's Boo Buckets Disappoint Fans

• McDonald's revived its iconic Happy Meal Boo Buckets, available in white, orange, green, and blue with customizable stickers.
• Fans are disappointed with the new designs, citing that the buckets are smaller and lack lids compared to the originals from 1986.
• Despite the negative feedback, some still find them appealing for children.

Fishwife's Tinned Fish Makes a Splash

• Fishwife, founded by Caroline Goldfarb and Becca Millstein, hosted a successful pop-up store in Manhattan.
• The brand, known for making tinned fish trendy, showcased products like Smoked Rainbow Trout and introduced California White Sturgeon Caviar.
• Guests enjoyed gourmet bites and catchy merchandise, reinforcing Fishwife's chic culinary status.

Halloween Marketing in Full Swing

• Restaurants are launching Halloween-themed treats, with Tim Hortons and Dunkin' joining the trend.
• Bar owners discuss hosting Halloween parties on the weekend before the holiday to maximize attendance.
• The focus is on flexibility and catering to local preferences to draw larger crowds.

Sources:

• Restaurant Business
• Salon
• /r/BarOwners

Product Launches and Innovations

True Food Kitchen Debuts Quick-Service Spin-off

• True Food Market opens in Scottsdale, AZ, blending a restaurant and retail space to offer healthy meals for busy customers.
• The 2,800 square-foot location features a chef-crafted menu with nutrient-rich dishes like Nashville Hot Torpedo Roll and gluten-free chicken tenders.
• Collaborations with local vendors enhance community ties, and the bright retro decor provides a unique dining experience.
• Following a $100 million investment, True Food Kitchen plans to expand using smaller formats to make healthy eating more accessible.

Exciting New Food Products Hit the Market

• Primal Kitchen launches an Air Fryer Spray Oil, combining avocado and coconut oils for easy cooking.
• Graeter’s Ice Cream introduces limited-edition holiday flavors, including Pumpkin and Peppermint Stick, available starting November 1.
• Annie’s and Fruit Friends release organic Fruit Pouches with zero added sugar, catering to health-conscious consumers.
• Pringles brings back fan favorites like Dill Pickle and Hot Ones flavors, delighting snack enthusiasts.
• Bolthouse Fresh Foods rolls out new carrot products and commits to sustainable packaging over the next two years.

ReZorce Wins Innovative Packaging Award

• Zotefoams' ReZorce, an eco-friendly mono-material barrier packaging, wins the Product Innovation award at the 2024 Reuters Sustainability Awards.
• ReZorce stands out for its recyclable design, aiming to revolutionize the 250 billion unit-per-annum beverage carton market.
• Judges praised its practicality and potential to achieve circularity in packaging.

Food Science Course Launched by IFT

• The Institute of Food Technologists (IFT) introduces a new "Fundamentals of Food Science Course".
• Designed for professionals across the food industry, the course covers food chemistry, microbiology, safety regulations, and sensory evaluation techniques.
• Participants gain insights to solve real-world food challenges, enhancing skills to adapt to the rapidly changing food system.

Sources:

• FSR Magazine
• Food Industry Executive

Fast Food Reviews and Promotions

Mixed Reactions to McDonald's Chicken Big Mac

• The Chicken Big Mac has received lukewarm reviews, with many customers finding it bland and underwhelming.
• Patrons note that the chicken patties resemble oversized nuggets, lacking the flavor and texture expected.
• Priced at around $9.99, consumers feel it's not worth the cost compared to other menu items offering better taste and value.
• Some suggest modifications, like adding different sauces, but overall, it's seen as a gimmick.

Burger King's Purple Whopper Sparks Curiosity

• As part of the Addams Family promotion, Burger King offers free purple Whoppers during full moons through a BOGO deal.
• Customers report minimal flavor differences compared to the regular Whopper, with the novelty primarily in the bun's color.
• There's curiosity about side effects, like changes in stool color, but taste remains a primary concern.
• Some patrons question if customization options are available for the purple bun.

Buffalo Wild Wings Introduces 'Pick 6 for $19.99' Deal

• The new deal allows dine-in customers to choose six items for $19.99.
• Reactions are mixed: some see it as a decent offer for game days, while others feel the dine-in restriction limits its appeal.
• Discussions revolve around whether the deal provides genuine value compared to regular menu pricing.
• Concerns about potential impacts on staff tips due to the offer being dine-in only are also raised.

Blaze Pizza's 18-Second Soda Rule Raises Concerns

• Blaze Pizza implements an 18-second limit on soda dispensing, intended to control portions.
• Customers express frustration, fearing this may become a wider trend in fast-food establishments.
• The policy raises issues around convenience and accessibility, particularly for those with disabilities.
• Debate centers on the profitability of soda and whether such restrictions negatively affect customer satisfaction.

Sources:

• /r/fastfood

Operational Challenges and Industry Discussions

Strategies for Handling Cash Drawer Shortages

• Restaurant owners share approaches to managing cash shortages, emphasizing that employees should not be penalized for minor discrepancies.
• Implementing cash counting protocols at shift changes helps identify errors promptly.
• Training and documentation are crucial to maintaining accountability without harming staff morale.
• Trust and regular monitoring are key to fostering a positive work environment and preventing theft.

Bathroom Improvements Enhance Customer Experience

• Suggestions for enhancing small, single-person restrooms include installing motion-activated lights and adding coat hooks.
• Some debate the necessity, noting that the cost savings on energy with motion sensors may be minimal with modern LED lights.
• Providing conveniences like coat hooks can improve customer satisfaction, though opinions on their importance vary.

Using a Concrete Mixer for Food Preparation?

• A query about using a concrete mixer for mixing food sparks discussion.
• Majority advise against it due to food safety concerns and lack of NSF approval.
• Emphasis is placed on investing in proper, food-grade equipment to ensure compliance with health codes.
• While some share anecdotes of unconventional methods, the consensus underscores the importance of adhering to safety standards.

Kitchen Leasing Opportunity from a Gentleman's Club

• A bar owner considers leasing a large, unused kitchen from a gentleman's club to expand food operations.
• The idea is met with support, likened to operating a ghost kitchen.
• Potential benefits include increased revenue without significant downsides, despite possible social stigma.
• Success depends on effective marketing and maintaining food quality standards.

Sources:

• /r/restaurantowners
• /r/restaurant

Labor and Management Issues

Shift from Salaried to Hourly Pay Causes Frustration

• A restaurant transitions managers from salaried positions to hourly pay with a 40-hour work cap, resulting in a 20% pay cut.
• Managers express concern that this move is a tactic to cut labor costs and reduce benefits.
• Advice from peers includes strictly adhering to the 40-hour limit and documenting any overwork.
• Many suggest that such a significant change may indicate deeper issues within the company, prompting consideration of new employment.

Drug Testing Policies at Darden LongHorn

• An individual with a valid medical cannabis card is unsure about THC testing after receiving a management job offer at Darden LongHorn.
• Comments reveal that THC testing is routine, and failing a test could jeopardize employment.
• Insights into the work environment suggest it can be demanding, with management often required to perform line work duties.
• Opinions on company culture vary, but awareness of strict drug policies is emphasized.

Sources:

• /r/Restaurant_Managers

Business Opportunities and Advice

Zaxby's Plans Expansion into Maryland

• Zaxby's is set to open its first Maryland location in Cambridge in 2025, with additional restaurants planned in Easton and West Ocean City/Berlin.
• The expansion is driven by local developers inspired by Zaxby's during a trip to South Carolina.
• With 941 outlets and an average gross revenue of $2.7 million per unit, Zaxby's outpaces competitors like KFC and Popeyes.
• The brand's growth reflects the increasing popularity of chicken in the restaurant industry.

Crafting a Profitable Restaurant Menu

• A food truck owner plans to lease a restaurant and seeks a simple, profitable menu to complement their wood-fired pizza offerings.
• Community suggestions include:
  • Expanding Italian cuisine: Incorporate appetizers, pastas, meats, and desserts that align with pizza, providing a cohesive menu.
  • Focusing on fresh ingredients: Offer dishes that emphasize freshness and quality without relying on fried or greasy foods.
  • Considering Mexican dishes: Use shared ingredients for cost-effectiveness and quick service, appealing to a broader audience.
• Emphasis is placed on understanding the local market and avoiding oversaturated niches like BBQ.
• Keeping mains priced between $9 and $15 aligns with profitability goals while remaining affordable for customers.

Sources:

• Restaurant Dive
• /r/Restaurant_Managers

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