Tuesday, June 26, 2007

The Always Slammed Grille, perhaps?

The intervention should have come after the Halloween night when a kid in a red chili-pepper costume rang my door bell. “Ah, the Chili’s logo! Great choice of outfit,” I remarked to a bashful 7-year-old whose sister, dressed as a strawberry, was holding the hand of a toddler painted like a pea pod. “They’re posting some kind of same-store sales these days, huh?” His father whisked them away, and we didn’t get another trick-or-treater all night. Word had spread up and down the street: Beware the restaurant geek in No. 18.

Though, given a little-noticed thread in restaurant-naming these days, perhaps I should have been hailed as a marketing consultant waiting to be hired. Because there are definite signs of industry jargon becoming the sign fodder of choice.

Consider, for instance, a pair of intriguing concepts from two of the most-respected chain operators in the business. What did Legal Sea Foods, the New England seafood powerhouse, christen its newest venture? Legal’s Test Kitchen—shortened, in typically industry fashion, to LTK in one iteration. Those of us in the trade might know that a test kitchen is a place of experimentation, as LTK is for the upscale-restaurant company (the Test Kitchen is a fast-casual take-off that promises to get customers in and out in 15 minutes; the LTK variation features such high-tech amenities as iPod docking stations at the table). But will consumers embrace it?

Hillstone Restaurant Group, parent of the much-salaamed Houston’s chain, would probably bet so. Its restaurant in a high-end Newport Beach shopping mall is called Café R&D, as in research and development, or the department that usually runs a restaurant company’s test kitchen. Already three years old, the indoor/outdoor hybrid features such out-of-the-ordinary fare as the Vegetarian Nut Burger and the Silver Service Hot Dog.

Which brings me back to my new flirtation with restaurant consulting—have I got names for you! How about Comp Sales Booster Grille? Or Morning Daypart Diner? The Awesome AUV Inn? At the very least, Many Covers Café?

Tuesday, June 19, 2007

McD's Hong Kong units to get worms

McDonald's regularly features products in one sector of the globe that probably wouldn't fly anywhere else. Seldom have they been as noteworthy as what the fast-food giant is about to start peddling in Hong Kong. Indeed, the latest McItem has the unique distinction of being both one of the most outlandish ever showcased by the chain, and perhaps the most widely adaptable. And then there's the matter of the production process. How many restaurants crow about having worms on the premises?

Earthworms are crucial to generating the compost that McDonald's will start selling in Hong Kong in a few weeks, according to local media reports. The soil enricher will be generated by feeding food scraps, napkins and certain types of packaging to the worms, which break it down in a process known as vermicomposting. The adoption of the program at eight McDonald's units in Hong Kong will be the largest-ever use of vermicomposting, a U.S. college professor told the international publication The Standard.

A story in the paper said the process is expected to cut the restaurants' output of carbon waste by 80 percent. But that pay-off can only be realized if patrons dispose of their biodegradable materials in a separate container, which, the story said, will require some customer training on McD's part.

Restaurants in the United States are still awakening to ways of making their operation a little greener. Clearly the adoption of environmentally sounder practices has galloped far ahead overseas.

The question is, will we ever see worms being used by McDonald's domestic operations?

Monday, June 18, 2007

Who's afraid of mice?

Humans may be unmoved by the health implications of eating poorly, but your average New York rodent could apparently pen its own fad-diet book. After being filmed early this year inside a Taco Bell-KFC unit, acting like starved pensioners on a Martha Stewart cruise, Big Apple vermin were back on the airwaves this morning, cavorting this time within one of the city's Pinkberry frozen-yogurt outlets.

If you don't know Pinkberry, you haven't been to Los Angeles lately. The concept is the hottest craze since Krispy Kreme's flicker as a haute brand in the 1990s. Just to put it in perspective: Paris Hilton requested it by name during one of her jail stays.

Pinkberry features a tart, South Korean style of yogurt in just two flavors, regular and green tea. But if that sounds just a tofu wafer short of bark-flavored Jello, consider that the mix-in choices include Fruity Pebbles, along with fresh berries or other fruits. You can presumably bring in your own Count Chocula.

Even with those nods to indulgence, a perception of healthfulness is a big part of Pinkberry's draw. Call me finicky, but news footage of mice scampering around a unit kind of undercuts that image. Yet there were the clips on the local ABC affiliate, showing at least two of the pests inside a store on the tony Upper East Side.

Yet I'm apparently a veritable germ-a-phobe, given the coverage that followed on the internet during the day. As The New York Post reported, the incident didn't dissuade customers from lining up at the very store where the vermin had been spotted. The tabloid quoted one fan as saying, "As long as there's no rats in the ice cream, I'm OK."

In fairness, it should be noted that Pinkberry has already declared its New York stores "re-sanitized." It also told ABC that it was "chocked and puzzled" by the footage of mice running amock, an assertion supported by Health Department indications that no complaints had been leveled against the site of the videos.

In all, the incident amounted to 15 minutes of intense attention, followed by a mass shrug. It could be a reflection that the public is growing accustomed to rodent events. For that matter, small four-legged creatures may be in vogue with the Lohan-loving set. Look at how Paris clutches that varmint she calls a Chihuahua.

Oh, let it be

Starbucks logged its highest single-day sales of a music album when it moved 23,000 copies of Sir Paul McCartney's new "Memory Almost Full" on June 5. At a price of $15.95, the CD put about $360,000 into the chain's coffers on the first day of its availability—before the promotional tour, before a highly publicized "secret" show in a small New York venue, before airings of the disk's music video, before its considerable radio play, before the promo machine had kicked into high gear. The recording is now Number 3 on the Billboard sales chart, with more than 160,000 units sold.

Is that "Money" playing in the background? The Beatles' version, of course.

The chain presumably sold a few cups of coffee to the McCartney fans as they tramped through stores to the record display area by the sales counter. Some might've even popped for the chain's new high-priced sandwiches. But even without the lattes, that's a lot of cash to collect, especially since Starbucks is getting more than just the usual commission.

The ex-Beatle's release is the first on Hear Music, a new label launched earlier this year by the coffee giant and Concord Music Group. Other works are presumably in the pipeline. The venture presumably has entered the charts with a bullet.

Thursday, June 14, 2007

Feeding a green monster

The public is convinced the restaurant industry could do more to protect the environment, starting with the type of disposables it uses. But what if it's wrong? What if Tiffany and Brad Public are pushing for actions that might be more detrimental to the environment than the status quo? Does a restaurant do what's ecologically sound, or does it cede to mistaken impressions and accommodate the foot-stompers? Sadly, more and more are caving to the public clamor.

As those reluctant converts point out, they really have no choice. Even if they're willing to risk the ill will of customers, local lawmakers are taking away the option. San Francisco and Oakland have already mandated that restaurants switch from foam-type cups and disposables to paper carriers. Other areas are showing interest in propelling the movement into a trend.

Yet, as a Google search will demonstrate, even some environmentalists are unconvinced that paper is ecologically better. But input the search terms "paper," "versus" and "Styrofoam" and you'll also pull up a slew of rock-hard assertions that plastic is the worst hazard since DDT. Significantly, many of those contentions are made on college-related websites by students at the institutions—sometimes in direct conflict with what their professors are attesting.

Is it any wonder that the Jamba Juice drinks chain has organized a whole committee to address what management has slugged The Cup Challenge? Nine-five percent of the chain's intake is generated by the sales of smoothies, which means it uses more cups than a bra factory. Polystyrene works best from a customer-satisfaction standpoint, and yet the chain is concentrated in California, ground zero of the foam-ban movement. It's already had to switch to paper in San Francisco.

CEO Paul Clayton says that being green is part of the chain's culture, and that it wants to do what's right. But the evidence doesn't prove paper is better, notes he and other senior members of management. And long experience has shown it's decidedly worse from a customer-satisfaction standpoint. So what's a customer-centric brand to do?

The company is currently looking at such foam alternatives as paper coated with a corn-based shell, hopefully to enhance performance.

Monday, June 11, 2007

Where's a cat when you need it?

At any other time, it might have been sloughed off as one of the unfortunate occurrences that can embarrass even the most careful of restaurateurs. But Pizza Hut is a Yum! Brands concept, so when it's mentioned in the same breath as a rodent infestation, the world takes notice. Because, sadly for Yum, the world hasn't forgotten that its Taco Bell chain was the scene of a veritable rat cotillion earlier this year, still visible in videos posted on YouTube and other highly trafficked clip websites.

This time, according to internet and news reports, the overrun store was a Pizza Hut in Raleigh, N.C. Health authorities closed the outlet last week after a shift manager reportedly found six mice stuck to a glue trap. For up to two weeks prior, she said, relatives of the nabbed six could be seen scampering through the place.

"I saw about 10 mice," Venice Spivey was quoted as telling local station WRAL. "Everybody saw them. Customers saw them. We had customers calling us to the dining room, saying, 'Look, we've got friends.'"

According to a story on the station's website, Spivey was fired for alerting health officials.

After rats were videotaped inside a Taco Bell/KFC combo franchise in New York, Yum hired Bobby Corrigan, a noted scourge of the rodents, to help the company avert another vermin scandal. Corrigan is to rats what the late Steve Irwin was to crocodiles. "We have been working around the clock to prevent this from happening again," Emil Brolick, president of Yum's domestic division, said at the time.

The company may want to can Corrigan and just hire a bunch of cats.

At least it has the comfort of knowing it's not the only restaurant giant having pest problems. The Toronto Star reported that a local family has sued McDonald's of Canada after allegedly finding a rat's head, complete with whiskers, in a burger. Meanwhile, mainland China's state press agency reported that a student collected $290 from the fast-food chain after being bitten in one of its units by a rat.

Friday, June 8, 2007

Now they're chasing human assets

Grab a rifle and head for the ramparts because we're being raided. After picking off restaurant companies one by one, private-equity firms are coming after the industry's executives.

They got Robb Chase last week. The president of Papa John's international operations was hired away from the pizza chain after just nine months on the job by a private-equity concern in Toronto.

A chain executive told me during the big restaurant show in Chicago that he'd been approached by another of the thick-walleted firms. It wanted his assistance in identifying and assessing acquisition candidates, and possibly to help in righting any handyman's specials they could pick up for a bargain price.

Meanwhile, consultants say they're fielding calls from private-equity companies that either want a download on trends that can affect a prospective acquisition's price, or advice on how to repair something they've already purchased and thereby raise its value.

It's easy to see why the companies are trying to tap the trade's brainpower. Private-equity firms have a lot of dollars, but sense sometimes eludes them, as a few of their foodservice deals have suggested. They're realizing that the restaurant business can be a peculiar one, best understood by a veteran steeped in the trade's puzzling ways.

And then there's the matter of timing. Many observers say the best acquisition candidates have already been scooped up by the equity firms, leaving what amount to berries on the bottom of a basket. They still might be good, but you have to pick more carefully.

Many of the companies are also hitting the point where they have to deliver a return on their purchase, either by cranking cash from it, or shining it up for a sale. They need experienced renovators and turnaround specialists to hasten the process.

The last thing the restaurant industry needs is a rival vying for its leaders and thinkers. It's just one more not-so-pleasant reminder that the private-equity pack is a part of the business right now, and a big one at that.

Monday, June 4, 2007

Where there's smoke, will there be fire?

Smoke is emerging as a key flavoring in this spring’s crop of new chain menu items. Consider, for instance, the products that were unveiled today alone. The barbecue fumes were enough to make your eyes water.

El Pollo Loco added two variations on its flame-grilled Chipotle Barbecue Chicken—one featuring barbecued beans, the other a dash of barbecue sauce, for added smokiness in items that started with the flavor of a smoked habanero.

Jack in the Box’s hyperactive R&D center cranked out an item also featuring grilled chicken, a shot of barbecue sauce, and some barbecue redundancy—in this case, barbecue-flavored tortilla strips, all mixed into a new entrée salad called the BBQ Ranch Chicken.

And Quiznos, an LTO machine in its own right, took its new Baja Chicken sub out of the bag. It’s hepped up with two sauces—a chipotle (read: smoky-tasting) mayo, and a proprietary sauce called Smoky Baja.

Another common trait of the bunch: Most were premium-priced, ranging as high as $7.99 for a large version of Quiznos’ new sub, to no lower than $4.99 for the Jack in the Box salad (though El Pollo Loco didn’t tell us what it’s charging).

Of course, those weren’t the only products introduced today by chains of scale. Taco Bell also fly-cast one into the market—without a hint of smoke, or a premium price, for that matter. Its new Extreme Cheese and Beef Quesadilla is aimed at the young men who want heft, but don’t have the pocket money to buy in volume and still put something toward the next body piercing. It’s priced at $1.29.