Restaurant and Food Service Blog

With Mayor Richard Daley running the vote, the Chicago City Council on Wednesday repealed its controversial ban on foie gras.

The council voted 37-6 to repeal the two-year-old ban, which critics argued had made Chicago–and the City Council–a national laughingstock.

And this all just in time for one of the biggest food/restaurant parties to take place in just a couple of days – the National Restaurant Association Convention at McCormick Place. How uncanny that Charlie Trotter can now dazzle all the foodies that will be descending on the Windy City.

This whole idea of local municipalities being do-gooders and looking out for our well being is ludicrous.

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New corporate chef at Baskin Robbins. Stan Frankenthaler has a long past into food and his new foray into the QSR world after being in the fine dining sector for so long is an interesting twist.We will have to see what new menu items he will be bringing to BR!With Dunkin Brands making a huge push to open 10,000 units by 2010, I find it interesting that they are bringing in someone like Stan. This is a person who has a ton of fine dining background, but is he going to be able to really bring his game to the QSR world. We have seen a couple of people do it such as Zack Caulkins at Quizno’s, but so many of these corporate chefs have been groomed in this area. Maybe this is a sign of things to come.read more | digg story

LOS ANGELES (AdAge.com) — “Howard Schultz insists he’s returning Starbucks to its roots, but he’s doing it with mass-marketing tactics once anathema to the original brand. The company is estimated to have nearly doubled its marketing spending to $100 million, and last week it began an aggressive coupon program unlike anything in its history, raising questions about its turnaround strategy.”As a former Starbucks partner, I am shocked to see that the company is going the route of couponing. During my time at the Siren, it was always about the quality of the product and there was never a reason to have to discount the value of a quality cup of joe. But it looks like a desperation move by Schultz and the gang there.What I find more interesting is My Starbucks website – an interactive blog site where customers can voice their opinions to the company. In a telling statement of the state of the company and its interaction with customers, it looks like customers want something “free” from the company for being loyal to the brand. Seems to make sense. Buy 10 cups and the 11th one is free. Seems like a no brainer. But for so long the company did not have to do these types of tactics.In the end, it seems clear that the companies that can be most nimble and in touch with its consumer base will win the battle.read more | digg story

Darden just disclosed 3rd quarter earnings (See press release on RestaurantNewsResource.com)  With a lot of positive comp sales growth in almost all of their brands, I wonder if the restaurant behemoth is looking to make a turn for the better. As most of the causal dining sector has been going over the past couple of years, the segment is due for a better run.  However, with transportation and commodity costs still running high, I question if this is only temporary.In addition, much of the positive earnings that Darden is showing can probably be attributed to the sale of Smokey Bones in December of last year.  The the looming economic slow down and financial crisis on Wall Street makes for great fodder for the restaurant industry.

Restaurants in Europe, the United States and Japan are testing technology to let diners order their food direct from a screen at their table instead of depending on a fellow human being to note their choice — sometimes grumpily or erroneously.This may work for only a limited few concepts where ambiance and personality are of no importance as much as speed of service and availability. I have visited a few places such as Sheetz gas station where they offer many gourmet items off their hot line and you order from a touch screen. It works there, but if I am going to go out with family and friends for a good meal, part of the experience of going out is the theatre that a good waiter can provide. Have a great waiter and you will have the time of your life. Have a terrible one; and you have stories to share with friends and family. Either way, I would rather take my chances with the human being thana boring touch screen computer. I almost always know what I will get that the LED screen of death.  read more | digg story

Technomic, the restaurant consultancy group, released its annual reporting of the top restaurant chains in the US. Technomic’s data shows a current slow down in restaurant sales in 2007 relative to 2006.The quick causal and limited service concepts continue to do well. But was interesting to see is that even among the good segments, there are still losers. This will ultimately be the demise of poorly run concepts.More importantly, what I think this will do is make the restaurant industry stronger. The industry is due for some contraction and with any cycle it is necessary to weed out the players from the dogs. Look at Brinker for example. They recently let go a bunch of talent. But in my mind it was probably necessary. What has Brinker done lately. The brand was once known as great breeding ground for tomorrow’s talent. If you had a Brinker background and were half decent, you would go far in this industry.But look at Brinker now. Just about everything they have had a hand in is terrible. Romano’s is in the toilet. Chili’s has seen better days. And Maggiano’s is fluttering about. Perhaps it is the casual segment since it has really taken it on the chin over the past couple of years. But what I think that the casual dining segment needs to learn is that most American’s today want quality and value. That is probably why the quick casual (Panera and Chick-fil-A) and limited service (Starbucks) are still doing well.read more | digg story

Last month I delivered my 2008 Predictions for the Restaurant Industry. I want to share that piece with my readers. Please let me know your thoughts.This is the first annual Predictions for the Restaurant Industry presented by Orrick Nepomuceno, CPC. 2008 will prove to be a tough time for the US economy that will have a huge impact on the state of the Restaurant Industry.

1. Sluggish Sales Growth Will Continue For 2008. The restaurant industry overall will see very conservative growth across all segments (casual, quick casual, quick service and fine dining). According to NRA estimations, the industry will see only a 0.9% sales growth for 2008. Although more Americans are spending a higher percentage of their disposable income allocated for food then ever before, most households will be less likely to eat out several times a week. Most likely, they will eat at home and save instead. Even if the President’s economic stimulus package does pass and Americans see a few extra spending dollars, most economists believe that most households are barely making ends meet. Bottom Line: Americans will have more disposable income in their wallets, but will probably consider saving instead of spending.
2. Increased Energy And Wholesale Food Costs Will Have A Negative Effect. With the price fluctuations in crude oil, lower and mid level-income households will feel a tighter pinch on spending disposable income on dining out as they will be inevitably hit hard with increased gasoline prices. Studies have shown a direct correlation to slumping restaurant sales and the increase in gasoline prices. Additionally, 2007 saw a nearly 8% increase in wholesale products. Much of this cost was eventually passed on to the consumer in higher menu prices. Most estimations see wholesale food costs to remain high for 2008 as well. Bottom Line: Households will get a double hit with transportation and dining expenses.
3. Technology Will Continue To Advance Even More Rapidly Than In Previous Years. Companies will look to the Internet for connecting with customers in more ways than before. Traditional print and television mediums will drive consumers to websites for offerings and coupons. Online ordering will become more robust as mobile handheld devices such as the iPhone have web browsing capabilities similar to their desktop versions. Also, a “Facebook” and “MySpace” type of social networking will become more prevalent with company sites where consumers can create online profiles. Bottom Line: The restaurant industry has a long way to go before it catches up with other industries in terms of technology.
4. Recruitment And Retention Will Be Of A Lesser Concern. The restaurant industry has always been a labor-intensive industry with recruitment and retention being typically the biggest concern among most hiring managers. But for 2008, according to NRA predictions, the industry will see a relatively small increase (0.9%) in the employment growth rate. Coupled with a slowing economy, job creation will be less than in 2007. Thus, with less demand for employees in 2008, many hiring authorities may substitute their concern for human resources to other cost cutting measures. Bottom Line: Many operators’ concerns will be moving towards cost reduction in order to stay competitive.
5. Bullish On Coffee Bars. One segment, although relatively small, the Snack & Non-Alcoholic Beverage Bars (Coffee and Dessert bars) will see higher than normal growth compared to other segments. In 2007, coffee bar sales outpaced beyond the rest of the crowd. Bottom Line: Companies will look to find niche segments where there is little or no saturation.
6. Global Cuisine. At a recent conference of Executive Chefs across America, most commented on smaller sized portions and introduction of ingredients from different parts of the world. Ethnic flavors found roots in the US with inspiration from Latin America, the Mediterranean, the Middle East and Southeast Asia. Many chefs also commented on utilizing more local produce, sustainable seafood and grass fed beef and poultry. Bottom Line: American diners are becoming more savvy and demanding more exotic flavors when they go out.
7. Fat Is Not In. Americans are demanding healthier foods as we wage the war on fat. Look for menu offerings at current concepts to reflect this trend, but also expect new totally concepts to emerge and fully embrace a menu offering with healthier choices – a la Seasons 52. With obesity in America on the verge of becoming an epidemic and local municipalities looking to stiff arm the industry into removing trans-fats and other harmful foods, the restaurant industry as a whole needs to get ahead of the curve and take a stand on obesity. Bottom Line: Expect the Federal Government, not local municipalities, to continue campaigns to reduce the consumption of trans-fats.

It is all too clear that the restaurant industry is a far cry from truly creating a level playing field for the top executives. Sure there are companies that certainly outperform such as YUM! Brands and Pepsico.  These companies not only talk the talk, but they definitely walk the walk as far as diverse executive talent.But the rest of the industry can be seen as a true good old boys club. With so many of the restaurant workforce being made up of minorities, it is absolutely a disgrace that the executive suite does not reflect a broader spectrum.  Not it can be argued that diversity is nice and all, but there certainly are no definable metrics that can prove that it will really improve the bottom line. Regardless of what it may in fact bring to the bottom line, the truth is that diversity is really a good thing for all companies. This not some feel good message. This is about giving those individuals an opportunity to shine. No special favors or recommendations. But a real chance to prove that regardless of color, race, religion or sex, each and everyone of us has something to offer and bring to the table.This uniqueness and difference is what can make every company better. As an Asian, I bring a different set of experiences from a Hispanic or African-American.  Each and every one of us can learn to respect and honor each other. That is turn will help our company become a better and more competitive brand.