Sunday, September 30, 2007

Beltway bets

It was like popping into an airport bar to catch the playoffs and finding a stranded Joe Buck and Tim McCarver perched on stools, offering their play-by-play to a select crowd that happily included you. In the dullest of years, attending the National Restaurant Association’s Public Affairs Conference makes you feel like a Washington insider. Catching the annual political download at a time like the present, when the presidential race is fuzzier than Phil Spector’s hair, was akin to getting a D.C. zip code. Elsewhere in the nation, pundits may still be wrangling over which candidates will get the nominations of their respective parties. But everyone inside the Beltway seems to have a solid hold on who the final contestants will be. And the wonks gladly shared that information with restaurateurs attending last week’s conference.

Almost certain to top the Democratic ticket, presenters agreed, is Hillary—though Mike McCurry, a former press secretary for her husband, added a major asterisk. If her performance in the early bell weather primaries suggests she can’t win the general election, the party faithful will likely abandon her for more of a centrist candidate like John Edwards. Why put money and party machinery behind such a polarizing force?

For that reason, Clinton’s chances of returning to the White House were portrayed as unlikely.

Likely to face her in the general election, McCurry and successor Ari Fleischer both noted, will either be Rudy Giuliani, Mitt Romney or Fred Thompson. In further analyzing the situation, the former presidential spokesmen noted that Thompson is the Great Unknown, with the mien and outsider credentials of the Great Communicator, Ronald Reagan. But, as Fleischer said, the question is, “is there any there there?” Is Thompson an actor playing a role, or a genuinely wise, principled conservative of impeccable integrity?

Romney was likened to the Energizer Bunny, the battery-charged, in-the-pink phenom who just keeps going and going and going. They noted that he also has solid business experience, having founded the private-equity behemoth Bain Capital. Yet nothing was said of his political stance, perhaps because it’s changed like the seasons since he caught the attention of Massachusetts voters in his run for governor. Other pundits have noted that the voting public of that state hardly match the political composition of the national populace.

And that left Giuliani, about whom they said virtually nothing positive or negative. Which, judging from some of the other political handicapping that was offered aloud during the conference, is the modern-day equivalent of having FDR’s oratorical skills, JFK’s money, and OTB’s designation as a favorite.

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Monday, September 24, 2007

Appreciating small buns

One of the bigger things on chain menus this fall could be the tiny burger. Applebee’s is touting the mini sandwiches in its current commercials, and T.G.I. Friday’s is featuring a version on its high-profile new mix-and-match menu. They join such earlier adapters as Damon’s and Ruby Tuesday, which could cater Munchkin Land’s annual picnic with the three mini-based options it offers. The current array stretches from a turkey variation to the more traditional ground-beef variety.

But the phenomenon is hardly limited to the full-service sector, as Good Time Burgers can readily attest; the regional quick-service chain credited its tiny Bambino Burgers for a 13.8-percent comp sales leap during July and August. Back Yard Burgers, another regional brand, offers a 1/8-lb. Great Little Burger. Still another local player with ambitions, Five Guys Burgers, sees enough potential attraction within its Eastern stronghold to offer four permutations (with or without cheese, with or without bacon).

And, of course, the bite-sized burger remains the signature of White Castle, whose “slyders” (also spelled “sliders”) are still revered by hardcore fans as the one true mini. The chain claims to be the originator of the juicy little morsels, though plenty of other specialists point to years of spatula work with Lilliputian patties, from Krystal to occasional White Tower that refused to fade with the rest of that chain.

The roster will likely continue to grow as more chains grab for a product that could be the bouncing ball in a sing-along review of menu trends. Small indulgences, vis-à-vis spoon-sized desserts? Absolutely. Affordable luxury, a la high-art cocktails? It’s not a coincidence that many of the new burgers are made with Angus (or even kobe beef (or, in the case of Damon’s, a mix of the two meats), providing a luxe experience at a price below the pain level. Modular eating, where you build a meal from a little of this and a dab of that? What better element for a collection of shared items than a plate of two or three little burgers (or four or six, again in the case of Damon’s).

Plus, says well-known menu consultant Nancy Kruse, there's a built-in nostalgia factor for the large segment of the population that grew up on White Castle, Krystal or, in areas like Washington, D.C., White Tower or White Spot. Add in what is likely an attractive food cost, and a good margin, and you have a product that makes sound business sense, too, notes Kruse.

Of course, this isn’t the first time that small sandwiches have surged into a big thing for chains. When commodity spikes had the big brands searching for a way of offering greater value, Burger King tried a two-pack of minis called Burger Buddies. The product proved an operational nightmare, with the tiny patties slipping through the conveyor-like grillwork of the chain’s signature chain broilers.

KFC opted for 1-oz. chicken-patty sandwiches called Chicken Littles. If you Google the name, you’ll find a slew of blog reminiscences of the product, along with a petition imploring KFC to bring the product back. Clearly the item was a hit. But with a product that sold at about 39 cents, if memory serves me correctly, you couldn’t make any money unless you nailed the management contract for all of Munchkin Land’s feeding operations. It just wasn’t feasible.

Chains are far less bashful about how they price the current crop of minis. But are these products that are here to stay? Or are they today’s frozen yogurt?

Wait a minute—isn’t frozen yogurt making a comeback?

Sunday, September 23, 2007

The Roger Clemens syndrome

The producers of “Nova,” the popular science program, should forget about aboriginal tribes that worship Ernest Borgnine or ant species that build crude nuclear reactors. If they really want to focus on a scientific marvel, they should spotlight whatever mysterious force tends to turn the blood of foodservice veterans into grade A ketchup.

The vampire or virus has clearly been at work in recent months, leading to the memorable newsroom query of a young Nation’s Restaurant News staffer, “Ever heard of somebody named Jerry Richardson? He just bought into Bojangles’.”

Every heard of Jerry Richardson? When I was her age, that would’ve been like asking, “Anybody got a gauge on whether McDonald’s sells burgers or pizza?” He was a god of the business, a self-made gazillionaire who’d originally bought into the restaurant industry with money he’d earned by winning what many pundits still regard as the greatest football game of all time. He snatched a pass from Johnny Unitas during the 1959 championship series—this was eight years before the first Super Bowl—to beat the New York Giants.

He’d go on to build a colossal foodservice empire, with Hardee’s franchises at a cornerstone, but other interests ranging from Canteen Corp. to Quincy’s Steakhouse, Denny’s, El Pollo Loco and Hilton International. In his heyday, Richardson was as prominent a figure in the business as Yum! Brands’ David Novak or Darden Restaurants’ Clarence Otis is today.

But, of course, a lot has happened between that day and the present. Richardson, it seemed, never lost the football bug. The game was a big part of the culture of Spartan Foods, the Hardee’s franchise he built with longtime business partner (and fellow football fanatic) Charlie Bradshaw. Alumni of Spartan Foods still recall the rough-and-tumble inter-squad matches they’d be expected play at the company’s annual meetings.

For years, Richardson tried to use his wealth and connections to land an NFL franchise for the Carolinas. He finally succeeded in 1993 with the establishment of the Carolina Panthers, of which he remains the principal owner. To run the team, he stepped out of the business, but retained a Bojangles’ franchisee that he’d quietly purchased in the 1970s and delegated to his son, Jon, to run in the years since.

And now Richardson is suiting up to get back in the game. He’s named a longtime protégé as CEO of Bojangles, and Richardson has left little doubt that he intends to wield an active hand in the company’s operation.

It’s doubtful he needs the money, given the income bracket of most pro-sports team owners. Public records indicate that he’s about 71 years old. And he’s known success all of his life. Clearly he doesn’t have to do this.

Yet he sounds eager to put in the long hours and considerable effort that’s required to reinvigorate and expand a franchise chain. Clearly, he’s pumping Heinz or Hunt’s through his veins.

Then again, he’d have no problem finding transfusion candidates. Just days before Richardson’s name re-emerged, we ran a story about Dick Holbrook’s re-entry into chain management. A longtime second-in-command of Popeyes parent AFC Enterprises, Holbrook was stepping out of an investment role to become president of J. Christopher’s, one of the new breed of breakfast-and-lunch concepts that should just about finish off the old coffee-shop-style family restaurant.

Holbrook’s partner in the endeavor is Sam Haddock, who’s slung his share of burgers, drinks and fried chicken, too. He hails from the Rally’s, Donatos and Moe’s Southwest Grill chains.

But they’re hardly alone in returning to the trenches after careers that would be adjudged successful by even the harshest critics. Steve Lynn came off the bench to lead a still-pending acquisition of Back Yard Burgers. Paul Fleming, the “P.F.” in P.F Chang’s, recently bought into the 10-unit Z’Tejas casual-dining chain.

Skip Sack, a veteran whose career stretches back to the heydays of Howard Johnson, controls a considerable packet of Applebee’s stock. He garnered a nice nest egg by selling his Applebee’s franchises—repeatedly the most profitable in the system—back to the parent company. Yet he’s developing a group of Irish pubs.

Abe Gustin, the one-time Applebee’s franchisee who ended up buying the brand from W.R. Grace and making it the biggest brand in casual dining, exited the chain with some franchise territory for his family.

Ned Grace, the founder of Capital Grille and Bugaboo Creek, is a backer of New England’s high-volume Not Your Average Joe’s chain.

Tom Russo, another Howard Johnson alumnus and onetime chairman of the British housewares giant Hanson Trust, still participates in industry events. Does anyone doubt he’ll show up atop a chain at some point.

Ditto for Michael Kaufman, the former head honcho of Steak and Ale and Bennigan’s parent Metromedia Restaurant Group.

What is it with these folks? They get in the industry, and then they can’t let go of it. Clearly there’s something that creeps into their system, turning them into lifers, regardless of whether they need the business or not. What is this strange infection—some might say avocation—that catches hold?

Best look at what “Nova” has scheduled for its new season.

Wednesday, September 19, 2007

First oil, now garbage and darkness?

Every day seems to bring another report of restaurant fryer oil being turned into bio-diesel fuel for trucks and cars. The Friendly’s chain, for instance, now uses its in-house distribution system for what may some day be a closed-loop system. Right now, the trucks deliver supplies to units, as per the usual. But instead of heading back to their garages with empty cargo bays, the vehicles pick up used oil from the stores and haul it to a recycling center. The fat is turned into fuel, which is then used to power the trucks, offsetting their need for conventional diesel.

Pundits have remarked that the process would quickly become an industry norm if a chain giant like McDonald’s added the used oil from its restaurants to the flow. That quantum leap in scale would make the reprocessing commonplace, along with the retrofitting of vehicles to burn the recovered oil. Suddenly, a quirky green cottage industry becomes a sizeable source of alternative fuel.

But McDonald’s seems to be channeling its petroleum-saving endeavors in another direction, judging from British news reports. Today, 11 McDonald’s units on the other side of the Atlantic reportedly started shipping their garbage to energy-generation plants instead of landfills. The trash will be burned to churn out electrical power for 130 buildings in their area, according to the local media. There’s already talk across the pond of rolling the program to every McD’s restaurant in the United Kingdom.

The initiative offers a double benefit: No McDonald’s trash flowing into landfills, and less fossil fuel firing the turbines of power plants.

McDonald’s is also experimenting in Britain with solar panels, wind-powered generators and new cardboard recycling programs, according to news reports. Some noted that the chain is largely blocked from recycling its waste because many centers won’t touch refuse that could be contaminated with food.

Meanwhile, new green ideas continue to be hatched here in the colonies, from operators big and small. The latest from the West Coast: A proposal in San Francisco to have restaurants join residences and other businesses in turning off all their lights between 8 and 9 p.m. on Oct. 20, or during the height of the Friday rush. Lights Out San Francisco is patterned after a one-hour blackout that was coordinated in Sydney, Australia during March. The voluntary effort was estimated to lesson carbon dioxide production by 24 tons.

Sunday, September 16, 2007

Who's gonna make us?

Despite Rick Berman’s outstanding work as an industry Doberman, public-advocacy zealots are growing bolder in their attempts to bully the trade. Consider, for instance, the letter that was reportedly sent to Bill Allen, chief executive of Outback parent OSI Restaurant Partners Inc. Penned by an anti-abortion group called Life Decisions, the letter warned Allen that the various brands in his charge could be hit with a boycott if the company ever again made a donation to Planned Parenthood, according to a story in the St. Petersburg Times. Never mind that OSI’s lone dealing with Planned Parenthood, a group that champions contraception and family planning, was a “small” contribution by a single restaurant on the West Coast in 2005.

One restaurant, out of the 1,400 operated under OSI’s umbrella, making a single donation two years ago. The company hasn’t so much as advertised on a program that could be construed as pro-choice. Yet Life Decisions is threatening to steer customers away from the concern unless it does the group’s bidding.

The abortion debate is irrelevant to the matter. The issue is the attempt by a group with an avowed agenda to strong-arm a neutral company into acting in accordance with the advocate’s stance. Regardless of how anyone feels about abortion, that sort of bullying is just plain wrong.

To his credit, Allen apparently ignored the ultimatum. The Times reported that he called Life Decision’s bluff by not responding. He needs to stand firm against that sort of coercion, for the sake of reason as well as the independence of his company. It might just be a much-needed stroke of sanity for the whole industry.

Tuesday, September 11, 2007

Isn't it 9/11?

The calendar says that today is Sept. 11, but you wouldn't know it here in New York. Local newspapers gave the anniversary a minimum of attention, focusing on aspects like the controversy over where a commemoration for victims' families would be held, or an exhibition of photographs at a civic museum. It doesn't seem right that such a monumental development in the lives of all of us who were here on that day six years ago would go unremembered. So here's a one-person protest, in the form of my recollections. They start, curiously enough, with an Afghani in foodservice whites.

I'd come out of the subway in Greenwich Village, a decidedly non-corporate area of the city about a mile north of the World Trade Towers. As I stood at the window of a cart that sold coffee and breakfast pastries, I could see the sky just south of me filling with black smoke. It seemed to hover over New York University, where I'd gone to school and where I knew one of the science facilities had a nuclear science program. I figured it had blown up.

The guy inside the cart saw me looking. "A plane hit World Trade Sen-tair," he told me emphatically. "I see it!" I would learn later that he had come from Afghanistan to sling cruellers and muffins from a two-by-five cart five mornings a week, rain or shine, during heat wave or cold snap. The tip-off was the pro-American signs he'd post in his wagon after we invaded his homeland and some Americans got a little testy with any Muslim they encountered.

Figuring some dim-wit in a Cessna had flown too close to the Towers during a sight-seeing expedition, I grabbed my bagel and coffee and headed up to my office. By the time the elevator doors opened, the second airliner had hit. A colleague told me as I was walking onto a floor that normally would have been abuzz with editorial activity. The only sounds were the click-clacks of computer keyboards and telephone touch pads as we tried to get word about what was happening. We could see the burning towers outside our windows, but had no sense of the larger picture. The internet was jammed, phone systems—land-line and cell—were overloaded, and TV reception was already shaky (one of the city's main broadcast antennas was atop one of the towers).

A few of us managed to get a call through to loved ones in other parts of the country, who relayed what they were watching on TV. But one of our co-workers, a young woman who now works as a restaurant publicist, was unable to locate a brother who worked on Wall Street and lived across the street from the Trade Center. He would later be located, but his wife was missing until she was tracked down to a hospital bed. She'd been injured while walking their dog when the first tower collapsed.

Back at the office, we didn't know what to do. We had very little information, hordes of people covered in soot were marching up from Ground Zero, and we were still sketchy on the details. For instance, some of our telephone contacts said that other planes were still in the air and authorities thought they may be part of the attack.

We'd have gone home, but the city was virtually quarantined by that point. No train service in or out, all vehicular traffic across the bridges was stopped, and you couldn't even walk across most of them. Sirens were wailing, and National Guardsmen were out in full combat gear, with police vehicles zooming through the streets. And we were stuck right in the middle of it.

Knowing that my wife worked across the street from Madison Square Garden and down the street from the Empire State Building—two likely targets if another attack came—I tried to coax her to leave her office and meet me for lunch, as far from any landmark as I could get. We agreed to meet in a park midway between us.

The streets were packed with people marching up from the World Trade Center, looking like ghosts because of the soot. Yet no one spoke. It was quieter than church until suddenly we all stopped and looked skyward, where a plane was clearly visible. By that time, we knew all commercial aircraft had been ordered out of the sky. Was this plane heading toward another building in the city?

"It's okay," someone shouted. "It's a fighter plane." The whole crowd, thousands of us, broke into nervous laughter. Then someone said in a pained voice, "But is it one of ours?" Suddenly, the silence resumed.

But it proved not to be a peril, so the silent trek resumed. I met my wife and tried to get into one of the few restaurants near the park that was open. Most never fired up their fryers and ovens because deliveries had been turned back at the city's borders, and workers couldn't get into Manhattan because the subways and buses were grounded.

This was a hotel restaurant, and it was doing gangbuster business. It just didn't want ours. "We're only serving guests, since we don't know when we're going to get another delivery," the host brusquely informed us.

So off we trekked, to my wife's office. She knew that someone at her company had scored a few pizzas. The concern had set up a relief center in its boardroom, with soft drinks and the pizza. Most amazingly of all, it had good TV reception. We decided to camp out there, in part because we could peer across the street at Penn Station, where we'd be catching a train if they ever started running again.

Her company, Thomson Financial, had a satellite office down at the World Trade Center. Without telephone service, no one at the midtown office knew how the people at the Center had fared. But as we were eating, they started showing up one by one. No one had known if they were alive or not, so the reunions were tearful ones. Each person arriving would be pumped with information about who else they'd seen either leaving the office or walking uptown. Some people already knew that colleagues from Thomson's Boston headquarters had been on one of the flights that struck a tower. And my wife knew that a competing company was holding a conference that morning in Windows on the World, the restaurant atop one of the Towers. We assumed that everyone there would be gone.

In total, the company lost eight people. It would make a large donation to one of the recovery funds, a fact that still fills my wife with pride.

Our train line started running again in mid-afternoon, after Penn Station was cleared by a bomb scare. By then we knew about the crash of the plane in Pennsylvania, and were pretty sure that no other craft were in the air. But we knew that life would never be quite the same again.

Six years later, we all know how true that intuition was.

Sorry to meander off on a personal reminiscence that has little to do with foodservice. But for the sake of the 74 Windows on the World employees who died that morning, it seems important to remember that day. And I plan to do it every Sept. 11 for as long as I live.

Sunday, September 9, 2007

Must-flee TV

With the new television season about to begin, this is a perfect time to look at the programming additions that are sure to be a hit with restaurateurs, given some of the recent developments in their business. Here are our picks from the new fall line-up.

Catch that Alien! Thwarted from forcing restaurants and other employers to fire immigrants who may be using a bogus Social Security number, the federal government came up with this new reality show. Employers are awarded points for the illegal immigrants they turn over to the authorities, with the top vigilante bagging a free trip to Mexico. Participants get 50 credits for the deportation of an immigrant employee who’s been with them for at least five years, 30 credits for a head of household, and 20 for someone who’s sure to face abject poverty back home. Any score over 100 entitles the contestant to a free weekend at Lou Dobbs’ home. But, true to the program that a San Francisco court thwarted some 10 days ago, employers who refuse to play are fined $10,000 for each illegally residing employee they fail to bust. There was a movement to call the program the No Match Game, after the letters that would have been sent to employees with a directive to fire staffers with bogus Social Security information. But that title is being used for a new game show where participants point out where the country has veered from its heritage.

Ken Burns’ Celebrity Restaurateur A 30,000-episode series on the restaurant business’ irresistible attraction for film, television and recording stars. Then again, the latest convert, Nick Lachey, doesn’t exactly fit any of those classifications. Neither does his partner, Nicky Hilton, whose claim to fame is being the younger sister of Paris Hilton. Whose achievements, in turn, include being born into wealth and starring in an online sex video. Lachey, in case you don’t regularly visit, BANG or other rivals to, is the ex-husband of Jessica Simpson, the legendary successor to such songstresses as Barbra Streisand and Judy Garland. The restaurant, to open in Las Vegas’ Luxor casino-hotel, will be an American-style place called Company American Bistro, according to US magazine. With the debut, Lachey would join a long, long list of celebrities who have given the industry a try, from Justin Timberlake to Minnie Pearl, Ron Wood, Johnny Carson, Mickey Rooney and Muhammed Ali. Each installment of this new PBS blockbuster will open with a shot of James Dean’s crushed Spider sports car, to symbolize the success of most ventures to date.

The Drive-thru Volleys Fed up with the web-fueled prank of hurling drinks and other missiles at drive-thru window staffers, restaurant chains fight back in this new program, whose episodes will also be posted regularly on YouTube. Staffers will be provided with tennis racquets to volley the drinks back at pranksters in their cars, with a video camera recording it all for the yucks of web surfers with far, far too much time on their hands. The defense is a reaction to the craze that has cited in this space before, called Fire in the Hole. It’s presently the height of hilarity for drive-thru customers to throw the contents of an open drink through the window to douse the employee on the other side, while someone else in the car videos the escapade on a cell phone for posting on the internet. The customers yell, “Fire in the hole!” and speed away with the rest of their order. Recent news reports suggest that some of the Einsteins who have embraced the prank are going farther afield in what they throw. Last week, for example, a snake was reportedly thrown through the window of a Taco Bell in Mississippi, though some stories quoted the unit’s manager as saying the snake entered the restaurant through other means. The incident drew the attention of writer Dave Barry, blogger Ariana Huffington and late-night talk show host Conan O’Brien. No wonder that it’ll be airing on O’Brien’s network, NBC.

Thursday, September 6, 2007

What hath Harry Caray wrought?

If you want to catch a game at Wrigley Field during next year's NRA show, start sucking up to indie-group operator Rich Melman, sports concessionaire Larry Levy or McDonald's chairman Andrew McKenna. The three are part of the thick-walleted investment crew that Chicago media have tagged as the lead bidder for the city's beloved Cubs.

The group is led by John Canning, chairman of the private-equity firm Madison Dearborn Partners, itself no stranger to the restaurant industry. Long before the current wave of private-equity-financed restaurant acquisitions, Madison Dearborn was active in the field, with investments in Ruth's Chris, Burger King franchisee Carrols Corp. and the Peter Piper Pizza chain.

Of course, the group isn't the only suitor for the team, which is narrowly holding on to first place in its division. Among the other reported tire-kickers is Mark Cuban, the one-time Dairy Queen employee who is perhaps a tad better known as owner of the Dallas Mavericks. The bad boy of sports moguls did time at a DQ unit after shooting off his mouth about an NBA ref. Cuban publicly remarked that he wouldn't hire the guy to manage a Dairy Queen. The quip cost him $500,000 in fines from the league, and Cuban decided to make nice with the working world by spending 90 minutes behind the counter of a DQ unit in Texas.

But even before he added swirls to soft-serve cones, Cuban was no stranger to the restaurant business. A former partner is Jeffrey Yarbrough, the Dallas restaurateur and one-time president of the Texas Restaurant Association.

And lest you think the restaurant industry is unrepresented on the other side of the deal table, consider that the pending Cubs sale is part of a larger transaction for current owner Tribune co., publisher of Chicago's namesake newspaper. While divesting the team, the media concern is in the process of being sold itself for $8.2 billion to Sam Zell, who made more than a few of the dollars in his considerable real estate fortune by serving as a landlord for Melman.