DELIVERY MOVES PARTIALLY IN-HOUSE P.23 FOOD COST FORECAST FOR 2018 P.

11

January 2018

WHO
INSPIRES
INNOVATORS
Taco Bell’s chief and
THE
COMPANIES
THAT
INSPIRE:

WOW
BAO
BLAZE
PIZZA
other influencers name
the brands and thinkers BUFFALO
that ignite their ideas. WILD
WINGS
[ BRIAN NICCOL, TACO BELL CEO ]

RED
ROBIN
P.38

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 RESTAURANT BUSINESS / JANUARY 2018 / VOLUME 117, NUMBER 1

CONTENTS
FEATURES
Who are you watching? . . . . . . . . 38
Restaurateurs share where they
find inspiration outside the
industry, from Apple to Zappos.

IN THE KNOW
A 2018 commodity outlook, adult
beverage trends, wine after the
wildfires, tip pooling and more . . . 11

BEST PRACTICES
Sexual harassment. . . . . . . . . . . . . . . 17
In the wake of accusations, the
industry asks, “What’s next?”
Weather preparedness . . . . . . . . . . 18
Advice Guy . . . . . . . . . . . . . . . . . . . . . . . . .21

BUYING
Delivery 2.0? . . . . . . . . . . . . . . . . . . . . . . 23
Operators are taking a hybrid
approach to off-premise.
In steering Taco Bell, CEO
Brian Niccol looks to brands
he says are known for “caring CONCEPTS
and doing more,” such as REI. Red Robin goes ‘virtual’ . . . . . . . 27
The FSR experiments with a
delivery-only location.
Chains adapt to grocery . . . . . . . 28

MENU INNOVATION
When wing prices soar. . . . . . . . . . 31
Restaurants mix up the menu to
handle rising chicken wing costs.
An LTO melt that wins . . . . . . . . . 32
The 5 types of drinkers . . . . . . . . . 34

IN EVERY ISSUE
Editor’s Welcome. . . . . . . . . . . . . . . . . . 6
Reality Check . . . . . . . . . . . . . . . . . . . . . . . 8
Products . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
COVER AND Advertiser Index. . . . . . . . . . . . . . . . . 47
PHOTOGRAPH
THIS PAGE BY
MELISSA LYTTLE Classifieds . . . . . . . . . . . . . . . . . . . . . . . . . 47
The Big Idea . . . . . . . . . . . . . . . . . . . . . . . 48

Restaurant Business (ISSN 0097-8043 USPS 917-180) is published monthly by Winsight, LLC, 300 S. Riverside Plaza, Suite 1600, Chicago, IL 60606.
Copyright 2018 by Winsight, LLC. All rights reserved. Subscriptions in the U.S. $119; Canada $160; air mail outside U.S. and Canada $360. Single copies in the U.S. and
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J A N U A R Y 2 0 1 8 R E S TAU R A N T B U S I N E S S 3
Editorial, Marketing and Corporate
Foodservice Group Media Operations Chief Executive
Director Director, Officer
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Chief Financial
Managing Editor
Officer
Sara Rush Wirth Production
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Coordinator
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Director, Content Ward Downing
Senior Editor Marketing
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Technomic
Editor Digital Production Shawn Edwards
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Products & Officer
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Contributing Editors Manager Officer
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4 R e s tau R a n t B u s i n e s s J a n u a r y 2 0 1 8
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EDITOR’S WELCOME

OUTSIDE
INSPIRATION
Operators mitigate the risk
of stale, inbred ideas by
refusing to stay insular. IDEAS ON
It’s a new year, yet we enter it heavy with the baggage
from 2017. Jan. 1 does not magically lift the problems the
LEADERSHIP
Operators we talked to named
restaurant industry has been facing, wiping the slate clean. author John C. Maxwell as an
Casual dining is still a segment potentially on the brink. inspiration on leadership. Here’s
Delivery remains a necessary puzzle to be solved, full of a glimpse of what Maxwell says:
outside profit-grabbing partners and logistical woes. And
SARA RUSH “Leaders must be
labor remains the top challenge for at least half of oper-
WIRTH close enough to
ators, according to the National Restaurant Association.
Managing Editor relate to others, but
In spite of the many conundrums restaurateurs are up
against, many I’ve spoken with aren’t stressed or fearful; far enough ahead to
they’re excited. Operating in a business-as-usual manner is out the window. motivate them.”
With the rapid speed at which things change, thanks to social media, tech de-
velopments and more, restaurant brands—and their leaders—are being chal- “Anyone can steer
lenged not just to act quickly but to actually be ahead of the trends. the ship, but it takes
It’s a daunting task: identifying and acting on ideas that haven’t actually a leader to chart the
hit restaurants yet. Still, the trendsetting leaders I’ve spoken with have some- course. Leaders who
thing in common—they follow companies outside the restaurant industry for are good navigators
inspiration.
are capable of taking
After all, consumers aren’t living their lives in a restaurant vacuum; they
see and use other industries as well. You know who else sees other industries?
their people just
Your employees. So it makes sense to look where else they are also looking, too, about anywhere.”
extracting ideas that might translate to restaurant operations.
Admittedly, I was a little overwhelmed for you, thinking about narrowing “The challenge of
down the giant universe of companies into a list of brands to follow and ex- leadership is to
plore more. But the curiosity led to this month’s feature, starting on Page 38. create change and
We wanted to know who the execs atop some of the most watched restaurant facilitate growth.”
brands watch. So, we asked.
I was surprised. Not that the responses ranged from Apple to Zappos. But
that these leaders follow brands for such a wide range of reasons. Some are
turning to culture champions to help shape their employee relations. Others
follow e-commerce giants to better understand consumer behavior. And then
there are those inspired by retail companies that convey a brand image that
goes beyond what they sell. With each operator’s response, though, there was a
clear reason for watching each brand—something actionable they were taking
away.
P ORT R A I T BY OL I V I E R K UG L E R

We want to know who you’re watching. If there are companies or other

thought leaders you follow for inspiration that we didn’t mention, shoot me an
email at swirth@winsightmedia.com.
Speaking of inspiration, check out the new look of the back page of Restau-
rant Business. Each month, The Big Idea will give you a peek inside an innova-
tion or development that’s made a splash in the industry.

6 R E S TAU R A N T B U S I N E S S J A N U A R Y 2 0 1 8
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REALITY CHECK
RESTAURANTS’ IDENTITY CRISIS
As off-premise booms, operators must figure
out how their businesses will keep up in 2018.
L
et’s review where we are
so far in 2018. Ah, why
bother. The latest version
of Google Maps can
probably pinpoint how
far restaurants have drifted from their
quaint 2017 existence.
Back in those dinosaur-friendly
times, restaurants knew their role in
the culture. People served food to oth-
er people in a pleasing setting. Then
came an identity crisis of Bruce Jenner
proportions. People? Pffft. The new
imperative is to erase humans from
the process, at least on the restaurant
side. Reduce any interaction to a fin-
gertip touching a screen. And forget
8 R E S TAU R A N T B U S I N E S S J A N U A R Y 2 0 1 8
customer face time. Entrust the food
to a stranger who’ll hopefully know to
look at the consumer while handing
over a delivery order.
Need more proof the industry has
been possessed by alien life forms?
Grab a seat and consider the evi-
dence. But that could be a problem,
given the industry’s newfound aver-
sion to seats. The trend is clearly to
reduce on-premise capacity, if not
eliminate dine-in business altogether.
Plenty of restaurateurs are betting a
kitchen is all you need, and even that
can be blasted with a shrink ray, if a
commissary is nearby.
This sounds like an old crab riffing
on Andy Rooney. But it’s intended to
highlight what should be near the top
of restaurateurs’ lists during resolu-
tion season, right under “Manage to
keep the doors open.”
The business is being remade by
forces bigger than the industry itself,
from automation to the acute nesting
fostered by Netflix, Hulu and the like.
Barreling toward the field are even
more forceful disruptors like artificial
intelligence and driverless cars.
The industry is responding with
all the force and initiative of a cork
lobbed atop a river, bobbing along
with the current instead of plying a
course. On the whole, it’s not reading
the patterns and actively remaking
itself for the times.
If there’s a strong tonic for the
business in what are likely to remain
bruising times, it’s dropping the
marketed passivity of last year and
redefining what restaurants should
become amid changing realities. The
success stories of 2017—McDonald’s,
Panera, Domino’s—were brands that
anticipated the seismic changes and
transformed themselves according-
ly. It’s the strongest takeaway from
a year that won’t be commemorated
by most operators with a smiley face.
So what’s your restaurant going to
become? Will it replace the in-home
microwave as the quick and easy way
to get a meal? Will it essentially func-
tion as a kitchen, with convenience
trumping all? Or will it be an experi-
ence, a welcomed relief for consum-
ers who want to step off the hamster
wheel for a few hours? That, after all,
has been a key aim of the industry for
roughly the last three decades.
The real hump is finding the right
PETER ROMEO blend, since you can’t take experi-
Editor-at-Large ence out of any transaction, even if
it’s merely opening a holding locker
to extract a takeout lasagna ordered
P ORT R A I T BY OL I V I E R K UG L E R
through Alexa.
Figuring out how your concept
should function in the strange new
world of the present is going to be the
overriding trend of 2018, regardless
of how many prognostications you’ve
read. The only thing tougher will be
engineering the follow-up transition.
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IN THE KNOW
Price Check
HOW FOOD COSTS
WILL FARE IN 2018
Wings are the wild card
amid improving prices.
F irst, the good news: Fore-
casters expect 2018 to be
a generally better year for
food costs than restau-
rants experienced last
year. “What’s good here is that the cost
of food is going to see a pretty modest
increase,” says Joe Pawlak, managing
principal for Technomic, referencing
data from the Bureau of Labor Statis-
tics’ Producer Price Index. “So, restau-
rants won’t have to price up to a high
extent to maintain their margins.”
Corn and soybeans—among the
most important indicators, because
they are the feed items for proteins
and dairy—have seen record or
near-record crops. “We have the best
available feed supply in the last de-
cade,” says David Maloni, president of
the American Restaurant Association,
which tracks and analyzes food com-
modity markets. “That should en-
courage protein and milk production,
and that’s really good news for 2018.”
However, at least one pain point of
the past year—chicken wing prices—
will likely persist in 2018, forcing op-
erators to get creative about how they
price the menu staple. Further, devel-
opments outside the industry could
throw a curveball into the forecast.
Wing prices still a concern
The ARA’s models suggest slight re-
lief in chicken wing prices. But, Malo-
ni cautions, “In my mind, we haven’t
seen prices go to a level yet where
RESTAURANT EXPERTISE IN 20 MINUTES
we’re rationing demand in any great
level, and that’s concerning.”
Near press time, wing prices had
dipped to a 14-month low, but the
growth in chicken production is ex-
pected to be tempered during the
winter, with the USDA predicting
a 1.6% increase year over year. A
number south of 2% suggests a trend
toward higher prices, says Maloni, a
challenging situation for restaurants
heading into the Super Bowl and
March Madness.
This trend in prices may solidify
a strategy that Popeyes, Buffalo Wild
Wings and a number of other chains
are trying: steering diners toward low-
er-cost boneless wings and building
in flexibility for bone-in wings on the
menu. (For more on this, see Page 31.)
All eyes on Mexico
While the Trump administration’s on-
going efforts to renegotiate NAFTA
aren’t expected to fall apart in the
end, the fact that the process has been
fraught with tension makes it worth
watching, says Maloni. If NAFTA un-
ravels, it would be devastating for the
price of avocados, for example, which
already has risen due to crop shortages.
But even just the climate created
by that renegotiation could impact
Beef prices could commodities longer term. Currently,
drop in 2018, but 40% of U.S. butter exports and rough-
a drought in the
Plains could limit ly a third of its pork, cheese, chicken
the relief in the and beef exports are to Mexico. Any
long run. notable change could put downward
pressure on prices, Maloni explains.
Short-term beef relief?
Last year was volatile for beef prices. In
2018, while they’ll likely spike at least
once, Maloni says, there are opportu-
nities for prices to go lower. And while
that’s good news, it may be short-lived.
The reason: a drought in the south-
ern Plains. If it continues, producers
could send more cattle to slaughter. In
the short term, it could drive beef pric-
es lower, but it will affect cattle produc-
tion in 2019, which would be bad for
restaurants’ bottom line. —Kelly Killian
“Operators who were at risk of pricing
themselves out have an opportunity
to re-establish themselves as being
competitively priced.” —Joe Pawlak
J A N U A R Y 2 0 1 8 R E S TAU R A N T B U S I N E S S 11
IN THE KNOW

Workforce Watch

TIP POOLING GETS

Your Job Is What?

RESTAURATEURS
FIND SECOND CAREERS
AS FINANCIERS
A growing number of big-name
restaurateurs are leveraging their
cash flows and business-building
know-how to branch into venture fi-
nancing, finding and funding upstarts
even outside the industry.
Dan Cathy, CEO of Chick-fil-A
and head of the family that owns the
chicken empire, revealed at Global
Restaurant Leadership Conference in
Dubai in October that he’s considered
forming a venture capital firm to fund
“experiential” retail concepts.
He’d join established operators
such as Danny Meyer of Union Square
Hospitality Group, which recently
pooled $200 million in private equity
to back fast-casual chains and tech
firms that serve restaurants, and Ro-
“For us, it seems to be the
right next step and the
right evolution.” —Laura
Rea Dickey, CEO, Dickey’s
Barbecue Pit
land Dickey, who stepped down as
CEO of Dickey’s Barbecue Pit to take
charge of a new holding company,
Dickey’s Capital Group.
The trend all but erases the dis-
tinction between operator and finan-
cier. The converts are betting there’s
AN OK FROM DOL
Restaurants would be permitted to
pool servers’ tips and share the mon-
ey with back-of-house employees
under new rules proposed last month
by the U.S. Department of Labor. The
suggested change would reverse the
DOL’s decision in 2011 to prohibit
restaurants from forming and run-
ning tip pools, in which gratuities are
combined and then reallocated to all
staffers instead of being pocketed
immediately by servers. Waiters and
waitresses were free to share their
gratuities with kitchen workers, bar-
tenders or hosts, or “tip out,” but at
their discretion.
In many states, tip pooling re-
mained legal, but the funds could
be split only among employees who
were customarily tipped—essentially
the servers. The money could not be
shared under federal law with dish-
washers, busboys or other nontipped
co-workers.
In some tip-out situations, em-
ployers insisted the practice was
voluntarily undertaken. Lawsuits
brought by a number of waiters and
waitresses contended the convention
was required, a de facto tip pooling ar-
rangement. Other suits accused em-
ployers of dipping into the pools for
their own gain.
Meanwhile, a compensation dis-
The Trump
administration has
proposed the practice be
allowed to equalize front-
and back-of-house pay.
parity between tipped employees and
nontipped kitchen workers continued
to grow, making recruitment for back-
of-house positions a steep challenge.
Under the DOL’s proposal, tip
pooling would be permitted in restau-
rants that do not take a tip credit, or
regard servers’ tips as a portion of
their income.
“We applaud the Department of
Labor’s review of tip regulations,” An-
gelo Amador, executive director of
the Restaurant Law Center, said in
a statement. The center was formed
to protect and preserve the restau-
rant industry’s interests through the
courts system.
In mid-December, the DOL ex-
tended until early February the time
granted to sound off on the adjust-
ment, a sign the measure is drawing
resistance. —P.R.

49%
as much or more money to be made
in moving around money as there is
in selling food and beverage. « Stat of the Month
Some of the concepts funded
Percentage of
by USHG’s PE fund, Enlightened consumers who say
Hospitality Investments, could be they’d be at least
operations started by USHG itself, somewhat likely to
according to the parent company. order breakfast for
delivery. While much of
Its current holdings include stakes in
off-premise is focused
Tender Greens, Sweetgreen and Joe on lunch and dinner,
Coffee. —Peter Romeo there’s opportunity in
the early hours as well.1

12 R E S TAU R A N T B U S I N E S S J A N U A R Y 2 0 1 8 1
Technomic’s Breakfast Consumer Trend Report, powered by Ignite
 IN THE KNOW

Technomic Trend Watch

SHIFTS IN DRINKING THAT

MAY CHANGE THE MENU
Adult beverage listings were up 9% on menus in
2017, increasing more significantly than any other
BEER SLIPS, OVERALL SPIRITS SOAR WINE GROWTH
part of the menu. The actual drinks may be up, COCKTAILS RISE CONSUMPTION One category IS FINE
but are consumers actually drinking more often at Roughly half
of all drinks
STEADIES impacting the
upward thrust in
Increased menu
mentions of red
restaurants? And how has their booze consumption The share of adult beverage
changed? A look might suggest a shift in what’s on consumers restaurant visits wine, white wine
ordered in mentions and Champagne
the menu this year. —Lizzy Freier that include on menus is
restaurants in an alcoholic and sparkling
the most recent spirits. Spirit wine align with
beverage listings are up
quarter involved remains steady adult beverage
beer, higher than 17.2%, with the growth overall,
at 41%, the same greatest growth
any other adult percentage but it’s the
beverage type. categories being “other wines”
seen last year. whiskey/bourbon
However, beer However, this category—which
consumption (+31.7%), Scotch includes blush
is up from 35% whisky (+20.6%)
for the quarter in the same wines and rose—
is down slightly and liqueur/ that’s seeing the
quarter of 2015, cordial (+20.2%).
year over year. highlighting the greatest push, up
Cocktail and overall uptick 9.9% compared
mixed drink in on-premise to the same
consumption, consumption. quarter last year. 
though, is on
the rise—up 4% Sources: Technomic’s MenuMonitor, powered by Ignite; Technomic’s
from last year. Co-Pilot, powered by the Adult Beverage Planning Program

What’s on Your Back that it is going to have on the volume the effects on certain finished wines,

FIRES HIT THE

of wine produced in Napa,” says Rob given that most of the 2017 vintages
Warren, director of winemaking for are still in the early stages of produc-

WINE SUPPLY
Southern California’s wildfires have
proven to be among the most wide-
spread in the state’s history. And yet
Cooper’s Hawk Winery & Restau-
rants, which produces 600,000 gal-
lons of wine each year with grapes
sourced from California, Wash-
ington, Oregon and other regions.
“Fortunately, going into this vintage,
we weren’t at a major shortage. The
tion. But because Napa and Sonoma
wines are protected appellations, says
Warren, wines labeled as such must
come from those regions. If there isn’t
enough from those two areas, prices
will most certainly rise, he says.
As such, Warren sees the years

restaurants are still grappling with
the potential effects of the summer’s
devastating Napa County wildfires,
which saw 75,000-plus acres burned
and about 50 wineries damaged. Now
that the smoke in Napa has cleared,
restaurants—including those outside
the affected area—are assessing the
impact on the wines they menu.
“There is a lot that we don’t know.
We don’t know overall the impact
market was in pretty good balance as
far as supply and demand goes. But it
really is a little bit early to tell.”
Winemakers note that while a
few dozen wineries sustained some
damage, about 90% of the 2017 har-
vest was already off the vines by the
time the fires began. But there still
could be consequences from the
smoke and fire near the vineyard.
Experts agree that it’s too early to tell
5
ahead as a balancing act for putting
wine on the menu. “It just means that
we have to be aware that there is po-
tential for wines to have smoke taint.
It can be pretty mild, and you might
taste it one day and not the next. It’s
The number going to be important for us as buyers
of wineries to play close attention, not in a para-
that reported
“significant
noid way, but we don’t want to make
damage” from the any bad purchase decisions,” he says.
wildfires —Kate Bernot

J A N U A R Y 2 0 1 8 R E S TAU R A N T B U S I N E S S 13
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S nacks that stand in for meals, a preference for cleaner
eating and flavor profiles that break out of traditional
boundaries: These trends, and more, are fueling
an appetite for soups and salads in both restaurants and
groceries’ prepared foods departments.
A number of approaches can help drive salad and soup
purchases:

• Offering more than one portion size gives customers the ability
to tailor their order to their appetite and budget.

Soup and salad also align with growing demand for takeout
options, as both lend themselves to portability and their
quality typically doesn’t suffer during the trip.
According to a 2016 study by ielsen, 66% of consumers said
they were eating healthier than they were two years before.
early the same percentage said eating a healthy diet is a
challenge—one that restaurants and grocers can help them
conquer by offering soups and salads.
What do consumers deem healthy? The ielsen study
found that terms like “made from vegetables/fruits,” “high in
protein” and “high in fiber”—all potential qualities of both
soup and salad—scored highest among consumers.
Among consumers who don’t purchase soup and salad away
from home, about a quarter say it’s because they can easily
make these items themselves, according to Technomic’s 2016
Left Side of the Menu: Soup & Salad report. By challenging
that perception and providing something unexpected
and craveable, salad-centric and soup-centric concepts
like Tender Greens, Sweetgreen and Zoup! have thrived.
Sophisticated flavors, reliance on premium ingredients and
providing imaginative choices that break out of the Caesar
salad and chicken noodle soup mold are keeping these
operations busy.
• Similarly, a choice of proteins provides a customized experience
and emphasizes a made-to-order message. And offering a
vegetarian “meat” or high-protein grain substitute will win
over vegetarians accustomed to salads sans protein.
• Garnishes—a swirl of herb-infused oil, a dollop of sour cream,
fresh chopped herbs, house-made croutons or crackers--can
turn a “plain” soup into something memorable.
• Two-fer deals provide value and allow guests to customize.
Suggesting complementary combos will help facilitate orders.
• Both soups and salads should change with the seasons. Lighter
broth-based soups, gazpachos and other bowls packed with
fresh vegetables will sell in the summer; heartier creamed and
pureed varieties will fare better in cooler months. Cool-weather
salads similarly can take on heartier grains, roasted vegetables
and heavier flavors when there’s a chill in the air.
• Regardless of the time of year, presenting both healthier
options and more indulgent selections will appeal to a broader
audience.
 THIS PAIR
DESERVES A
PROMOTION.
Soup and salad. The reason you
always see them together at
checkout is because they’re meant to
be together. Today’s shoppers demand
quality, taste and choices that are better
for them. Blount soups and your salads
uniquely fit that bill. Why not maximize
their positive impact on your sales and
profits by promoting them together?
Talk to the culinary experts at
Blount to find out how.
Learn more about Blount’s
premium soup choices by contacting
us at, 800-274-2526.

TM

www.blountfinefoods.com
MAY 20-21, 2018 • CHICAGO, IL

BEST
BEST PRACTICES
PRACTICES
RESPONDING TO SEXUAL
HARASSMENT IN RESTAURANTS
I
And where the industry goes from here.
n a post-Harvey Weinstein
world, there’s an awful anticipa-
tion over which star’s worst-kept
secret will be outed next. The
outpouring of claims of sexual
harassment and abuse helped popular-
ize a #MeToo social media campaign,
encouraging women to share their sto-
ries and spurring allegations against
upwards of 60 high-profile men. In
October, the movement’s momentum
hit restaurants. Since, industry giants
such as Mario Batali, John Besh and
Todd English were forced to confront
accusations of alleged sexual harass-
ment or misconduct.
For many women, the scope of
the industry’s sexual harassment
problem is not shocking. “To hear
that [the allegations] were being
taken seriously and that it was being
reported in a major publication—that
1
BuzzFeed News
BUSINESS IDEAS YOU SHOULD STEAL NOW
(From left) Mario Batali, John
Besh and Todd English face
harassment allegations.
Human Resources
was exciting to me,” says Caroline
Richter, bartender at New Orleans’
Turkey and The Wolf. In fact, restau-
rant employees and other service
workers have filed more sexual ha-
rassment claims with the U.S. Equal
Employment Opportunity Commis-
sion from 1995 to 2016 than any other
profession, according to a report from
BuzzFeed News.
With the industry tuning into
women’s calls to address harassment,
the question is, “Now what?” The
answer to that question is somewhat
elusive. When asked who restaurants
can look to as a leader in stomping out
workplace harassment, Amanda Co-
hen, chef-owner of New York City’s
Dirt Candy, says there’s not really any
such person within the industry. Ruth
Gresser, owner and chef of Pizzeria
Paradiso and Veloce in Washington,
D.C., echoed Cohen’s perplexity. “The
problem is so systemic and so funda-
mental to the industry,” Gresser says.
Although restaurants have yet to
devise a winning model to combat
sexual harassment, they are pointing
to structural and cultural ways the in-
dustry can move forward.
Don’t skimp
Restaurateurs should go through both
sexual harassment training and busi-
ness management training, Cohen
says. “There’s fire, there’s knives, and
there’s no handbook—you don’t al-
ways know how to do it.” Creating an
employee handbook, or updating it for
existing concepts, can be very pricey.
“I had to have a lawyer go through it,
and it was close to $10,000,” she says.
While she admits that it is a good thing
to spend on, she did have to debate it
as a cost when balancing other needs.
Meet often
When Cohen heard the industry alle-
gations of sexual harassment trickling
in, she looked at her business partner
and asked, “Are we good? Does ev-
erybody know the policy?” Deciding
it was time for a refresh, the restau-
rant held a series of staff meetings to
go through the handbook. “You don’t
have to fire someone for saying some-
thing stupid,” she says. “But you have
to nip it in the bud right away.”
Camaraderie can be a curse
The industry’s tight-knit community
can create an energetic and personal
workplace, but it can also make those
10,057
who have suffered harassment less
likely to report co-workers, Cohen says.
Richter says she’d trade some of
the industry’s camaraderie for a more
The number professional workplace. “We as an in-
of sexual dustry have been asking to be taken
harassment claims
from full-service
seriously,” she says. “If we want to be
restaurant workers taken seriously, we need to set a pro-
(1995-2016)1 fessional tone.” —Alaina Lancaster
J A N U A R Y 2 0 1 8 R E S TAU R A N T B U S I N E S S 17
BEST PRACTICES
READY FOR THE WEATHER
Operators use both high- and low-tech
methods to beat the weather woes.
O
perators battled
hurricanes, forest
fires and more in
2017, and while
the new year has
just begun, meteorologists are al-
ready releasing forecast predictions
for the rest of the year. A lot remains
unknown, weather-wise, so operators
are developing best practices, arming
themselves to weather the storms and
other disruptive forces of nature.
Plan of action
While the best course of action before,
during and after a storm depends on
its scale, Hudson Riehle, senior VP of
research for the National Restaurant
Association, says he’s seen operators
use one tactic: altering menu compo-
sition to deal with the conditions.
That’s the route taken by Waffle
House. It has multiple limited menus,
depending on available utilities, says
Pat Warner, director of PR and exter-
nal affairs for the brand that is often
seen as best in class when it comes to
staying open during hazardous condi-
tions. The 24/7 concept’s endurance
is so well known, in fact, that FEMA
uses an unofficial Waffle House Index
to determine the effect of a weather
event. If Waffle Houses are forced to
close, it’s likely a pretty bad storm.
Waffle House employees can also
consult the company’s weather play-
book for step-by-step actions to take.
That playbook is constantly updated,
says Warner, and will soon include
knowledge gained during hurricanes
Harvey and Irma. One of the most no-
table changes will be additional proto-
col for running the restaurant under
boil-water advisories.
“One of the things we learned ...
is that waffles aren’t the best thing to
make during boiling-water adviso-
18 R E S TAU R A N T B U S I N E S S J A N U A R Y 2 0 1 8
Skills
Parts of the South
and some of the
mountain states,
such as Arizona,
Texas and Utah,
have a 50% chance
of above-average
temperatures at the
end of the summer,
heading into fall.
A majority of the mountain states,
along with Texas, Louisiana and parts of
Mississippi, will have a 33% chance of
below-average precipitation this spring,
with Arizona dropping to a 40% chance.
Source: National Weather Service
ries—not because we can’t make the
waffle batter, but because of the clean-
up,” Warner says. “You don’t have the
water to clean up the sticky batter.”
Other updates to the playbook in-
clude organizational changes. “Right
now, [the playbook] is organized by
storm. Instead, we’re going to orga-
nize it into sections such as ‘Prepara-
tion,’ ‘Storm’s approaching’ and ‘After
the storm,’ because a lot of [practices]
overlap whether you’re talking about a
winter storm or a hurricane,” he says.
Tapping predictive technology
Having a plan in place may help mit-
igate potential lost sales, but some
operators are turning to technology
before weather strikes. Chains like
Garbanzo Mediterranean Fresh use
FORECASTING 2018
Here’s a look at what
to expect this year
There’s a 33% chance temperatures in the
Midwest will be colder than average through
March; there’s a 40% chance of above-
average precipitation. Out East, it’s most
likely to be warmer than average.
The Northeast will likely have above-average
precipitation July through September, with
the northernmost part having a 40% chance of
above-average precipitation. The rest of the East
has a 33% chance of above-average precipitation.
The Southern U.S. is likely to
see below-average precipitation
through March; parts of Louisiana,
Georgia, the Carolinas and Florida
all have a 50% chance of seeing less.
real-time data from predictive analyt-
ics tools to gain insight into how up-
coming weather may impact business,
and plan accordingly.
The fast casual, for example, uses
predictive analysis to better manage
its labor, says Director of Marketing
Devin Handler. The chain adjusts staff-
ing depending on how many guests
the tool predicts will come in based on
upcoming weather conditions.
While Garbanzo anticipated rainy
and sunny weather would affect guest
counts, Handler says the most sur-
prising thing Garbanzo learned from
the tool was wind’s impact on traffic.
“Apparently, people don’t go outside
in certain trade areas when it’s windy,”
he says. “We would’ve never guessed
that anecdotally.” —Benita Gingerella
 EVERY VINE
TELLS OUR
STORY
SUSTAINABILITY. QUALITY. INNOVATION.

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HOW TO SPOT
A SCAMMER
Red flags that can help distinguish
customers from con artists.
I’ve empowered my staff to re-
spond to customer concerns
and make things right without
needing my approval, but was
recently burned by a scammer
who went restaurant to restau-
rant demanding refunds, claim-
ing she ordered takeout and
found hair in her food! Where’s
the balance?
Unfortunately, wherever there is a
system, there will be someone trying
to take advantage of it. It’s great you
empower your staff to solve problems
directly. Even though you are feeling
the sting of this thief, I would suspect
that the positive service recoveries
you’ve made by enabling your staff to
solve problems far outweigh the cost
of the occasional bad actor.
That said, in the same way you
train staff to problem-solve, you
may be able to train them to detect
a scammer.
Scams like these share some
characteristics:
● They often happen during a busy
lunch or dinner rush when the em-
ployee (or manager) just wants
to solve the problem as quickly as
possible.
● They often are disruptive and
make threats such as calling the
health department, posting a video,
or posting to social media or review
sites.
● They often decline to answer
specifics regarding their order or
P ORT R A I T BY OL I V I E R K UG L E R
experience, covering their lack of
knowledge with mock outrage.
● While a real disgruntled customer
may share that outrage, they usually
want the restaurateur to understand
the problem, both to empathize with
their shock and to prevent future
problems. A good technique to sniff
J A N U A R Y 2 0 1 8 R E S TAU R A N T B U S I N E S S
Advice Guy BEST PRACTICES
out a scammer is to push them to
help you understand the problem, as
a real guest with a concern would do.
Some techniques:
● Slow down. Ask the guest to speak
about this at a time when they have
your undivided attention.
● Audit. Ask for specifics that you
can check against the POS so that you
can truly understand the problem.
● Interview. Gather details about
the food, timing and service that
only someone who has been to your
operation would know.
JONATHAN If you get unsatisfactory answers,
DEUTSCH call the police.
Professor of
Culinary How can I keep my employees
Arts and from using their phones?????????
Food Science
at Drexel While my editors reserve the right
University to edit your question, I hope they
leave in your nine question marks,
as it both represents an Advice Guy
record and underscores your exas-
peration. Fighting phone addiction
is something I’m struggling with at
school, work and especially at home
as the father of teenagers. And I
know I’m an offender as well.
When I addressed this problem in
the past, it was more about crafting
a policy that can help you manage
employees’ cellphone use to an ap-
propriate/responsible level, espe-
cially during service. Increasingly,
my advice is a straight-up ban: no
cellphones back of house, front of
house, anywhere at work, except
during official breaks. Your job is to
make money providing great food
and beverage to your guests and
putting their experience at the fore. I
don’t see how that is compatible with
employee cellphone use.
Provide a secure place, even
charging lockers, for employees to
leave their devices. Some may argue
that as long as they get their work
done and guests don’t notice, they
can keep up with texts and notifica-
tions. I think that’s the wrong way
to look at it—if they can keep up in
that way, they can be cleaning, help-
ing co-workers or taking on more
responsibilities.
21

Red Robin’s new unit
fields both self-delivery
and third-party orders.
A NEXT STEP FOR DELIVERY?
T
he drawbacks of using
third-party delivery ser-
vices are prompting a
number of chains to try
a new way of exploiting
the off-premise boom. Call it Delivery
2.0, a drift toward restaurants trans-
porting more orders themselves as
volumes grow and ordering patterns
PHO T O G R A PH BY H I L A RY H IG G I N S
change.
Big-name proponents like Red
Robin, Outback Steakhouse, Carrab-
ba’s Italian Grill and Zoes Kitchen ar-
en’t abandoning their collaborations
with dedicated deliverers such as Uber
Eats, DoorDash and Amazon. But
each is tempering that reliance with a
self-delivery/third-party hybrid.
1
Technomic’s On-Demand Delivery Report
WHAT TO BUY AND HOW TO SAVE
BUYING
Line Item
Operators take a hybrid
approach to off-premise.
At Red Robin’s new delivery-only
unit, Red Robin Express, who carts
the food is determined by how the
order is placed. “If ... you use your
DoorDash app, the order comes into
our system and one of their drivers
delivers it,” says Jason Rusk, VP of
business innovation for the full-ser-
vice burger chain. The customer ex-
pects DoorDash to ring the doorbell,
since that’s the brand they’re dealing
with. That holds true for orders from
the unit’s other partners, Uber Eats
and Grubhub.
But “if you go to Red Robin’s web-
site and you want to order delivery,
the nearest Red Robin restaurant will
show up as a pinpoint, you plug in
your order, and we bring the food to
you.” The experience is wholly a Red
Robin interaction. “It gives us total
control of the experience. It gives us
total control of the data,” says Rusk.
(For more on the unit, see Page 27.)
Operationally, self-delivery is easi-
er for Red Robin Express because of its
location, Rusk noted. It’s in the middle
of downtown Chicago, enabling em-
ployees to make most deliveries on
foot. If a car is needed, they use Uber.
Yet even if there weren’t any of the
usual challenges with self-delivery—
hiring drivers, accessing cars, tweak-
ing operations—the store would still
have worked with third parties be-
cause of the marketing advantages
they provide.
“If you ask the customer, over-
whelmingly they want Red Robin
to deliver to them,” says Rusk. “But
that’s a Red Robin consumer. We
know there are people who are loyal
to their platforms.”
Even a brand with the recogni-
tion of McDonald’s needs a listing
on a third-party app to snag consum-
ers’ attention, the franchisor’s CFO,
Kevin Ozan, recently told investors.
“You’re getting pushed up farther on
the app and people will see that more
often,” he said. “The biggest opportu-
nity for us on delivery is awareness.”
The lost exposure opportunities
are the real yellow light on self-deliv-
ery, not the costs, says Rusk. “Are the
economics better if you do self-de-
livery vs. third party? The answer is
19%
‘Yes,’” he says.
From a pure cost standpoint, the
challenge is building volume, says
Rusk. As a delivery-only operation,
100% of the Express’ sales will factor
into that. But there’s still the matter of
Percentage of exposure on third-party apps.
consumers who The chain will be closely moni-
rank delivery as
their top way to
toring the Express store to see if the
buy food away arrangement could work elsewhere.
from home1 —Peter Romeo
J A N U A R Y 2 0 1 8 R E S TAU R A N T B U S I N E S S 23
 WHERE INSIGHTS
BECOME INSPIRATION

C H A R R E D B E E F A N D V E G E TA B L E G R A I N B OW L

GRAIN UP ON U.S. MENUS

BOWLS 652% OVER THE PAST
FOUR YEARS*

At Custom Culinary® we’re dedicated to providing exceptional bases, sauces and

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rooted in culinary expertise and a thoughtful, innovative approach to product
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 BUYING

3
BOWLED
4 OVER
Products WITH
JANUARY PICKS FLAVOR
21 2 32 42
Meals in a bowl are trending across
CrewSafe’s EDITOR S ’ PICK Chef-mate Lidworks’
dayparts—patrons love them, especially
X-traSafe Operators can Country UltraStrong
Cartridge Knife use Euro-Bake Sausage Gravy Clear High when they look as good as they taste!
is designed with gourmet burger from Nestle is Dome Lids have
a replaceable buns from made with pork a large 1.9-inch
Custom Culinary® makes it easy to
cartridge to Lantmannen sausage and hole designed to create beautiful signature dishes with a
minimize Unibake to add seasonings to make blending
the hazards a premium deliver classic easier. Sturdy wholesome spin. Try a Charred Beef and
associated with element to gravy flavor in construction Vegetable Grain Bowl using our
handling loose burgers. Euro- a convenient helps prevent
blades; the user Bake offers an heat-and- cracking or Gold Label True Foundations™ Beef
never touches a assortment of serve format. shattering and Roasted Vegetable Bases, made
loose blade. The buns, including The gravy can during
environmentally pretzel, brioche be used for blending, the with clean, simple ingredients.
friendly and onion a traditional company says.
cartridge potato, to take on biscuits The lids are
includes a clear serve as the and gravy or available in 22-
guard, which foundation as a topping on and 32-ounce
covers the blade for a variety of sandwiches. It sizes and fit
after each cut, burgers and comes in packs traditional-size
and a manual other recipes. of six 105-ounce double-sided
guard lock. lantmannen-unibake. cans. poly paper cups.
crewsafe.com com/en-US nestleusa.com lidworks.com
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©2018 Custom Culinary, Inc.
J A N U A R Y 2 0 1 8 R E S TAU R A N T B U S I N E S S 25
 Extraordinary

Open here
For the crispy, golden-brown goodness
customers crave, always start with shredded
hashbrowns that are basically

delicious.
Order your free sample and get inspired
at baf.com/freesample

Basic American Foods is a trademark and Golden Grill® is a registered

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 CONCEPTS THAT ARE CHANGING THE GAME

CONCEPTS
Art of the Business

RED ROBIN ADDRESSES

DELIVERY-ONLY
The full-service chain hopes its
“virtual” concept will fly.
RED ROBIN IS TREATING one of its shuttered
fast-casual units in Chicago as a laboratory of
sorts, hoping to find success in the “virtual”
restaurant format where others have failed.
Red Robin Express is a challenging model,
says Jason Rusk, the chain’s VP of business
innovation. But the chain must find a way to
keep up with changing consumer demand,
and delivery (despite the “necessary evil”
of third parties, as Rusk refers to them) is
where it’s at, he says. There’s hope delivery-
only will succeed where Red Robin’s fast-
casual Burger Works concept failed, because
it allows for a pared-down menu and a
slimming of staff, he says. —Heather Lalley

To build its self- Timed delivery Hybrid Building a

delivery program, radius delivery model better bun
Red Robin has
At Red Robin In addition to To maintain its
reached out to its
Express, in the partnering with product integrity,
loyalty rewards
heart of Chicago’s half a dozen third- Red Robin’s
members who live
densely populated party delivery signature steak
within the shop’s
Magnificent companies, Red fries aren’t offered
delivery area.
Mile, delivery Robin Express for delivery.
boundaries are employs three Customers instead
PHO T O G R A PH Y BY H I L A RY H IG G I N S

set by minutes, people each get seasoned

not miles. Ideally, shift to handle chips. The chain
a delivery should deliveries that has also developed
be no farther than come in through a sesame seed-
eight to 10 minutes Red Robin’s topped brioche
away, Rusk says, website and app. bun that doesn’t
so each driver can These staffers get soggy during
handle about three deliver food on travel, Rusk says.
or four deliveries foot or by bike, It’s available at
per hour, and food while another four limited locations,
arrives at the right workers man the including the new
temperature. kitchen. delivery-only unit.

J A N U A R Y 2 0 1 8 R E S TAU R A N T B U S I N E S S 27
CONCEPTS

Concept Makeover

CHAINS ADAPT TO GROCERY

A Mediterranean concept adjusts operations Staffing in grocery stores

T
to fit the nontraditional footprint. presents a different
challenge, knowing that
the kitchen isn’t attached.

he team behind Israe-

li hummus and pita
chain Dizengoff op-
erates three different
small-footprint con-
cepts inside a massive new Whole
Foods Market in Philadelphia.
The units are moneymakers, but
adapting to fit into 150-square-foot
stalls caused some headaches, says
Steve Cook, partner with Michael Sol-
omonov in Cook N Solo, the restau-
rant group behind Dizengoff, Federal
Donuts and vegan falafel shop Goldie.
“It was an opportunity to get into
a relationship with Whole Foods, and
that was exciting because who knows
where that could lead?” Cook says.
Running the kiosk-like spaces
presented some logistical difficul-
ties, Cook says. The restaurant stalls
are located at the front of the Whole
Foods, which is great for foot traffic,
but less ideal for efficiency. Employ-
such as a supermarket, Cook says.
That problem has improved now that
CONCEPTS
Dizengoff (above),
ees have had to adjust to pushing Cook N Solo runs several kiosks in Goldie (left) and
carts through the store to get to the the Whole Foods and has a “critical Federal Donuts
dish room and prep area. mass” of people on the same team, he (below left)
Dizengoff ’s hummus and pita are
made on-site, as are the fried chicken
says. Most kiosk employees first train
at the concepts’ other locations. “It’s
LOCATION
Inside a
and doughnuts at Federal Donuts. But not the easiest place to train because 60,000-square-
knowing that the kitchen isn’t up front, it’s so small,” he says. “You can’t just foot Whole Foods
doughs and batters are made in a cen- throw an extra body in there. People grocery store in
Philadelphia
tral kitchen before being trucked over have to hit the ground running.”
to Whole Foods each day. For Cook, Another challenge of operating in FOOTPRINT
proper planning has been essential in the grocery store is asserting brand 150 square feet
making sure the grocery units have the identity in the midst of a larger brand, per kiosk
correct amount of product.
The separate areas also impact
Cook says. “I wouldn’t want to rely
on an establishment like this to build KEY FEATURES
Separate stalls
staffing; there must always be enough a brand,” he says. Each kiosk has five for each concept;
employees to cover the front while or six opportunities for branding, small seating area;
others are away from the stall. Too, from signage to lighting and menu each kiosk has five
it’s easy for employees to feel isolated graphics. Whole Foods often posts to six employees
per day; pita-
when working in a satellite location chalkboard signs with the concepts’
cooking oven;
specials throughout the store, Cook stove; fryer
“It was a way to do a store says. And they’ve discussed installing
in [a desirable area] ... lighted exterior signs on the building,
very quickly and with a so passers-by will notice the restau-
low capital investment.” rants in the evening. —H.L.

28 R E S TAU R A N T B U S I N E S S J A N U A R Y 2 0 1 8
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MENU INNOVATION
Arooga’s
WHEN WING PRICES SOAR
combos help
take the edge
off high wing
costs.
Chains built around chicken wings are
A
rejiggering menus to keep costs in check.
chicken only has
two wings—an an-
atomical fact that
poses a challenge
for restaurants that
focus on chicken wings. For several
years, demand by both operators and
consumers has outstripped supply,
which has jacked up prices.
That could turn into an especially
sticky problem in the first quarter of
2018, when the Super Bowl, NCAA
basketball playoffs and peak hockey
season converge and demand peaks.
At Arooga’s Grille House & Sports
Bar, the food cost for bone-in chick-
en wings is now 40%, says Gary
Huether, president and co-founder
of the regional chain. “Ten years ago,
wings averaged 89 cents per pound,
with a food cost of about 15%-20%,”
he says. “Wings and light beer were
my least expensive buy. Now, it’s the
opposite.” Like Buffalo Wild Wings,
which raised menu prices for bone-in
WHERE FOOD AND DRINK ARE GOING NEXT
Culinary Trends
wings late last year, Arooga’s bumped
up its own by 10%. But neither opera-
tor stopped there—both are applying
several other strategies to push cus-
tomers toward more profitable items.
Moving guests around the menu
Late last fall, Arooga’s introduced
combos on the wings page of its
menu. Customers looking for wings
can order five with a half-rack of ribs
and fries for $14.99 or with sliders for
$13.99—a deal that lowers Arooga’s
food cost percentage to the low 30s.
In addition, new menus are designed
to “bury” wings, highlighting more
profitable appetizers first, followed
by soups and salads, burgers and then
wings, says Huether.
There’s also innovation happening
in the appetizer category, he adds,
where new non-wing items such as
best-seller Buffalo chicken dip are
showcasing the popular wing sauc-
es. Another deliberate move was the
creation of a special menu section
highlighting 12 burger variations.
“Burgers now are getting more at-
tention from customers, with a larger
number of guests transferring wing
orders to burgers,” says Huether.
Going boneless
Lower-priced boneless wings, a prod-
uct made from more cost-effective
chicken breast, have been on Arooga’s
menu for nine years and yield a better
profit margin. The chain also recent-
ly introduced faux wings made from
mushrooms ($10.99 for seven pieces).
Like Arooga’s, BWW has long of-
fered boneless chicken wings, but last
November, the chain put them in the
spotlight. “We shifted from bone-in
to boneless wings for our Tuesday
BOGO promotion ... to improve costs
and make sure the supply doesn’t run
out,” says Amy Smith, BWW’s direc-
tor of culinary innovation.
Off-premise packages
In addition to samplers for larger par-
ties, BWW is offering combo menus
for groups in the off-premise space.
It recently launched a party menu for
eight or more eaters, geared toward
sports fans who gather in groups at
home. “Takeout business around big
game days has improved quarter by
quarter,” says Smith, adding that this
will continue to be a focus.
Arooga’s is also ramping up
$14
off-premise business, both in catering
and individual to-go orders, focusing
on better-margin items. A tailgating
package features 40 wings bundled
with two lower-food-cost strombolis
and a 2-liter soda.
Price for BWW’s
sampler platter Huether predicts that takeout and
with apps—fried delivery will make up 20%-30% of
pickles, nachos, business in the next five years. The
spinach dip advantage for these concepts: Wings
and chicken
fingers—that takes
travel well, as do most of the line ex-
attention from tensions these operators are offering
wings and exploring. —Patricia Cobe
J A N U A R Y 2 0 1 8 R E S TAU R A N T B U S I N E S S 31
MENU INNOVATION
Ideation

CONSUMERS CRAVE THE MELT 1

BUILDING VALUE
Chicken sandwiches and burgers, core items at Checkers
Drive-In Restaurants, are often the starting point for its WITH HEIGHT
Checkers’ own consumer
limited-time offers. That’s the case with the Big Daddy Bacon research revealed that the
Chicken, a sandwich Ryan Joy, senior director of R&D and taller the sandwich, the higher
its perceived value, says Joy.
culinary, calls “a new and improved melt.” When Technomic The Big Daddy Bacon Chicken
asked consumers to choose the LTOs they’d most likely stands tall with chicken, bacon,
Swiss cheese, grilled and fried
purchase, this sandwich ranked in the top three. More than onions and pickles. “Two types
of onions give the sandwich
half said they would buy it, edging out Checkers’ concurrent heft,” he says. Plus, the
LTO, the Big Daddy Bacon Double burger. —P.C. combination of textures and
flavors create craveability, Joy
says. Technomic’s MenuSurf
respondents back up this belief;
58% rate the melt as craveable.

2
THE LTO
Big Daddy Bacon
DIFFERENTIATING
WITHOUT
Chicken; two
for $5
COMPLICATING
Thousand Island sauce
was the only new SKU
needed for the LTO.
Staffers spread it on as
the sandwich is made
to order. “It’s an extra
step, but it doesn’t hold
up the line,” says Joy.
Neither does cooking
bacon fresh several
times a day, compared
to many chains that use
precooked bacon, says
Joy. These extras set the
sandwich apart; over
50% of consumers see it

60%+
as a unique offering.
4 3
SELLING VIA SOCIAL MAXIMIZING MARGINS
In addition to drive-thru signage, Checkers marketed the Although burgers are the main menu item at
Percentage of LTO via Twitter and Instagram, and it was picked up by Checkers, chicken is close behind, always on as
Gen Zers and Gen YouTube “reviewers.” Checkers is relatively new to social another option—and one that helps boost profits.
Xers who say they
media marketing, so the response wasn’t huge. But Joy The crispy fried chicken breast used for the melt
would buy the
sandwich, even more
reports that the sandwich generated 3.5% of sales during its is 4 ounces—the same size as the chain’s burger.
enthusiastic than run—“typical for that kind of product,” he says, adding that Both sandwiches are priced at two for $5, but
other groups TV ads, used for larger menu moves, generate higher sales. chicken’s lower food cost translates to a better
profit margin for Checkers’ operators.

32 R E S TAU R A N T B U S I N E S S J A N U A R Y 2 0 1 8 Source: Data from Technomic’s MenuSurf

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MENU INNOVATION
Beverage Tracks
THE 5 TYPES
OF DRINKERS
Get to know the
consumers spending on
booze at restaurants—
and those who aren’t.
Instead of focusing solely on
the standard demographics
THE CHAMELEON THE TOURIST
Travis loves the social aspect of
of age, race, income and drinking more than the actual
ethnicity, operators looking beverage he’s consuming. Just
as chameleons blend in with their
to bring consumers in the surroundings, Travis’ drinking
door can also explore groups behavior changes according to
based on their habits, needs the atmosphere and occasion. He
usually scopes out what his friends
and preferences—and then are drinking before ordering
target customers based on himself, and will likely get whatever
their motivations and decision they’re having. Although he doesn’t
have a preferred drink, Travis is
drivers. Here, a look at drinking interested in how adult beverages
consumers—three of which you
might see more than others,
are produced.
based on Technomic’s Drinker OPPORTUNITIES FOR OPERATORS
Archetypes program. Those ● Promote events, like Super Bowl
parties or trivia nights, to drive visits
groups—Chameleons, Tourists among the social Chameleons.
and Extroverts—account for ● Enhance digital ordering and
nearly three-fourths (74%) of payment. Half of the group are
millennials who often seek innovative
on-premise alcohol spending. tech advancements.
Take a look at what’s driving ● Menu a variety of top-shelf spirit
their beverage purchases. selections. Some 67% of Chameleons
—Brett Dworski place high importance on the brand.
● Highlight the most popular drinks on
the menu. It may appeal to Chameleons,
as they won’t have to wait and see what
their friends order.
NEED TO KNOW
● Some 34% of Chameleons drink beer
away from home at least twice per week.
● The group makes up nearly a quarter
of the total drinker population, but 40%
of the on-premise spend.
34 R E S TAU R A N T B U S I N E S S J A N U A R Y 2 0 1 8
Denise is very inquisitive during
her adult beverage experience.
She wants to know the types of
booze people are drinking, how
they’re made, and even the daily
operations of the bars she frequents.
Like Travis, Denise doesn’t have
a preferred beverage, but she uses
restaurant menus as an opportunity
to test new flavors and get a better
understanding of different brands
overall.
OPPORTUNITIES FOR OPERATORS
● Keep rolling out new flavors, helping
these guests expand their knowledge.
● Expand bar seating. This group is
eager to watch and see how their drinks
are made.
● Detail the booze backstory. Marketing
the beverages by describing how a beer
was brewed or wine was fermented, for
instance, can increase appeal among
Tourists.
● Create a female-focused ambiance.
Roughly 62% of Tourists are women—
the highest of any group.
NEED TO KNOW
● Tourists value innovation, quality of
process, and uniqueness, above all else.
● They make up for one-fourth of the
overall share of restaurant spending, the
second-highest behind Chameleons.
● Tourists consider going out to bars
and restaurants for adult beverages as a
form of entertainment.
Source: Technomic’s On-Premise Intelligence Report
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MENU INNOVATION

WHO’S
SPENDING
WHAT

THE EXTROVERT
THE MAXIMIZER
Karen’s kids are
grown up and she’s
retired, so there’s
more time to enjoy a
THE PURIST
Dimitri knows
what he likes and
isn’t interested in
stepping out of his
39%
The Chameleon’s
share of spend.
THEY ARE 24%OF
drink every now and comfort zone. While THE POPULATION.
Maria emphasizes the social then. Although she he may meet up with

25%
facets of drinking in restaurants doesn’t drink alcohol friends for a drink, the
more than anything else. The in bars or restaurants social aspects of the
main difference between her and too often, when she experience are less
Travis is that Maria has reliable, go- does, she’s looking important than the
to brands for her preferred drink and for good value or an quality of the beverage
establishment, while Travis usually experience she can’t and the service. The Tourist’s
goes with the flow. Maria is laid- get at home. share of spend.
back about prices, and usually buys
OPPORTUNITIES THEY ARE 20%OF
drinks for her friends, in addition to
OPPORTUNITIES FOR OPERATORS
THE POPULATION.

20%
FOR OPERATORS
leaving a generous tip for the waiter
or bartender. ● Featuring a range of
● A variety of wines plays beers may appeal to

OPPORTUNITIES FOR OPERATORS

well with Maximizers, Purists, who drink it
because they drink it more often than wine
● Offer discount drink specials. more than beer or spirits. and spirits.
Although pricing isn’t an issue with ● Ensure staffers
● Speed up the process. The Extrovert’s
Extroverts, over one-third of the group know the appropriate
Slow service makes share of spend.
makes less than $35,000 per year, so glassware for specific
Maximizers less likely to THEY ARE 18%OF
value may drive loyalty. drinks. Purists place high
return to a restaurant. THE POPULATION.
● Increase the variety of brews on the importance on this.

9%
● Affordable drinks and
menu. Extroverts are the second-highest ● Know the Purist
a memorable experience
beer drinkers after Chameleons. “regulars.” Although
are key, since most
● Create VIP treatment. As big spenders Maximizers usually drink they don’t come around
and social consumers, Extroverts may at home. often, knowing their
flock to concepts that give them special go-to orders may lead to
recognition.
NEED TO KNOW increased patronage.
The Maximizer’s

NEED TO KNOW
● Despite “good value”
being synonymous NEED TO KNOW share of spend.
THEY ARE 22%OF
● This is the only archetype with a with affordable prices, ● Purists evaluate THE POPULATION.
a restaurant by the

8%
50/50 split in its consumers by gender. Maximizers associate the
term with service and bartender’s ability to
● Despite being the second-smallest make a certain drink the
beverage quality.
group by population, Extroverts have way they like it, plain and
a considerable share of on-premise ● Although baby simple.
spending. boomers make up 50%
of the group, Maximizers ● They typically
● They typically have an idea of the order the same brands
are open to trying new,
drink they’ll order before arriving at the wherever they go, The Purist’s
trendy brands and
bar or restaurant. regardless of price. share of spend.
flavors.
THEY ARE 16%OF
THE POPULATION.

36 R E S TAU R A N T B U S I N E S S J A N U A R Y 2 0 1 8 Source: Technomic’s On-Premise Intelligence Report

INNOVATION
“Who doesn’t love Apple? …
It’s a feeling of surprise and
delight that’s almost euphoric.
We’re playing around now with
how to do our to-go packaging,
and I want that feeling of when
you open a new Apple product.”
—TED XENOHRISTOS
CO-FOUNDER, CAVA

38 R e s tau R a n t B u s i n e s s J a n u a r y 2 0 1 8
THE RESTAURANT
INDUSTRY WATCHES THESE
TRENDSETTING LEADERS.
SEE WHAT’S POWERING
THEIR IDEAS.
INSPIRATION
By Sara Rush Wirth
hat’s one of the most-named
sources of inspiration for restau-
rateurs outside of the industry?
Hands down, it’s Apple.
Trendsetting operators look to the tech
company for a variety of reasons, all tying
back to the customer. Whether it’s the sleek
look of Apple’s stores or the frenzy sur-
rounding its product launches, consumers
have to have the next iPhone. It’s that must-
have feeling that restaurants want when
consumers think of their brands.
It is a reminder that the best ideas for
culture, creativity, consumer engagement
and more often don’t come from within the
restaurant industry. Inspiration is every-
where—and anywhere—and big thinkers
mine it from a range of sources.
With that in mind, Restaurant Business
asked executives atop some of the most
innovative restaurant brands to name the
people and companies they turn to to spark
ideas. Their answers range from the Nikes of
the world to individual authors; from a com-
munity-minded outdoor adventure brand to
disruptive e-commerce companies.
What these other industries offer restau-
rant leaders is a chance to step back and see
a problem or opportunity from a new angle.
Or put in Apple’s terms, to “Think different.”
J a n u a r y 2 0 1 8 R e s tau R a n t B u s i n e s s 39
GEOFF ALEXANDER MARIO DEL PERO AND ELLEN CHEN, CO-FOUNDERS, MENDOCINO FARMS

EMPLOYEE-DRIVEN CULTURE
PRESIDENT, WOW BAO

MUST-HAVE LOOK Del Pero explains what his fast casual learned from hotels, online retailers and more:
The kiosk-driven steamed bun chain has
made some big moves in the past few HOSPITALITY CULTURE SOURCING INNOVATION
months. Following an investment from a For its tenets Zappos defines its “For help in trying “The biggest
tech-focused equity group, which led to of “selling happy” culture with 10 core to figure out how to lesson we learned
a shift in controlling interest, Wow Bao and creating a values, including scale our sourcing early: Innovation
became the first concept to implement feeling of care, embracing change practices, we really rarely comes from
the co-founders and creating fun. did not have any divine inspiration.
automat-style concept Eatsa’s technolo-
looked to Four Everything from restaurant group We continue to
gy. The president of the chain isn’t staying Seasons Hotels job descriptions to be inspired by. … credit more of our
insulated in restaurants to get his ideas. and Resorts and to the work We reached out to innovation success
the relationship environment the one company to Apple. While
engagement (aka reinforce them. that could help us we continue to
customer service) The company scale our supply have a very creative
of Nordstrom. conducts cultural- chain in a way culinary team, our
“Many of the fit interviews, and that would align team has evolved,
systems we built managers are with our values. morphed and
to scale Mendo expected to create It was Whole changed over the
Culture are from career paths and Foods Market.” last decade. What
the inspiration hold team-building Whole Foods has has remained the
we garnered from activities—all ideas since become same is how we
those two brands.” Del Posto looked an investor in innovate our menu.
“I spend lots of time reading my Twitter at when creating Mendocino Farms, This process was
feed—which consists of [my reading the culture at and founder John inspired by many of
list] as well as bloggers, reporters and Mendocino. Mackey a mentor. Apple’s practices.”
breaking news,” says Alexander. And the
companies he watches? Amazon, AT&T, “Hands down, Ellen and I have studied the
Nike, Verizon, Target, Whole Foods
and Costco. At the top of his list for com- practices and approach Zappos has taken.”
panies to follow: Apple. “Everything they
create becomes a must-have. And the items
and stores look slick and create a feeling of
FOMO—fear of missing out.”

READING LIST
Entrepreneur
Inc.
Fast Company
Wired
Time Out
New York Magazine
The Wall Street Journal

CARIN STUTZ, RED ROBIN, EVP AND COO

“[Our] first area of focus is our guests and meeting their ever-
changing needs—we pay attention to the brick-and-mortar
companies who have done well fending off Amazon, like Best
Buy and Walmart. Similar in grocery with Aldi and Lidl.”

42 R e s tau R a n t B u s i n e s s J a n u a r y 2 0 1 8
 BRIAN NICCOL, CEO, TACO BELL

VALUES BEHIND THE BRAND

ooking to promote Taco Bell as
more than just a brand selling Mex-
ican fast food, Niccol pays attention
to the models set by companies
known for giving back. “Brands
like REI, Patagonia and Toms
are examples of companies synonymous
with caring and doing more.” Niccol says
he wants consumers to know about more
than just the Doritos Locos Tacos when it
opens a new store. “Every time we open a
restaurant, we’re giving people more than
just tacos and burritos—we’re giving com-
munities job opportunities and those em-
ployees the opportunity to go to school.”

INSPIRATION FROM REI

REI—which is set up as a cooperative, with
more than 6 million profit-sharing cus-
tomer members—has been on Fortune’s
list of The 100 Best Companies to Work
For nearly 20 years in a row. “Every deci-
sion we make at the co-op is purpose-driv-
en and it impacts our culture every single
day,” said REI CEO Jerry Stritzke to For-
tune, when it ranked 28th.
The brand boosts employee morale
with steep discounts, paid days off called
Yay Days and grants for outdoor adven-
tures—reinforcing the culture committed
to like-minded outdoorsmen, both inter-
nally and to customers.

IDEAS FROM TOMS

“It’s brands like [REI and Toms] In addition to its well-known social mission
to help impoverished communities, Toms
whose intrinsic values transcend
Photo g r a Ph by M e li s sa ly t t le

CEO Blake Mycoskie implemented poli-

cies and programs to improve employees’
beyond the products they sell.” daily lives, including offering flexible work
schedules, eight weeks of paid paternity
leave and no-meeting Mondays. The ideas
were submitted by employees through an
online platform called Toms Idea Room.
The company’s interview guide in-
C R E DI T T K

cludes four sets of questions to identify its

key values in potential employees, reports
Inc. magazine.

J a n u a r y 2 0 1 8 R e s tau R a n t B u s i n e s s 43
ERIC MARTINO, CHIEF OPERATING
OFFICER, THINKFOODGROUP’S
FASTGOOD BRANCH

LISTENING FOR
LEADERSHIP INSPIRATION
The man behind the branch of Jose Andres’
restaurant group that runs veggie-forward
chain Beefsteak and incubator ThinkFood-
Lab credits much of his inspiration to his
READING LIST
John Maxwell
wife—who he dubs the CEO of his house- Malcolm Gladwell
hold—for being a dedicated advocate as Adam Grant
well as challenging him. Aside from listen-
ing to his wife, Martino tunes into podcasts
for ideas and inspiration. He subscribes to
TED Talks, Andy Stanley, Innovation
“Listening to podcasts or
Ecosystem and Lewis Howes. “In those
podcasts, they tend to have guests on that
reading a chapter before work
are leaders in a particular field or industry really does help me calibrate
that deal with similar challenges and fo-
cuses that I face in our industry. There are my mind to lead and think
great discussions, from how to unlock in-
ner greatness through different strategies
outside the box.”
and exercises like meditation and diet, to
staying ahead and pushing forward to in-
spire innovation.”

Authentic Flavor for Modern Menus

 JIM MIZES
CEO AND PRESIDENT, BLAZE PIZZA
SAM FOX, CEO, FOX RESTAURANT CONCEPTS

“Not only does design play a big UPGRADING THE PRODUCT

role in all of our restaurants, but WHILE SAVING PROFITS
it’s something I’m personally A leader in growing a brand at the fore-
front of a trend, Jim Mizes has led fast-ca-
passionate about. I really sual chain Blaze Pizza from an emerging
concept to the No. 191 on Technomic’s list
enjoy following the New York of top-grossing chain restaurants. There
interior design studio Roman are a number of authors Mizes reads on
the topic of conscious leadership, and
and Williams on Instagram. several companies with business models
he admires.
... They have great taste and a Both Apple and Tesla are focused on
disruption through many approaches, he
unique way of curating spaces says, but always through design, technolo-
by pushing everyday design gy and the value of the experience. He also
looks to Amazon for inspiration. “How do
boundaries and blending you take a product and service and make it
cheaper, faster and more profitable?”
historic aesthetics with
contemporary components.” READING LIST
John Maxwell
Jim Dethmer
Diana Chapman

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BROOKS GOLDADE
DIGITAL EXPERIENCE AND VENMO USAGE
Users of the payment
INNOVATION: MOBILE & .COM,
app made $8 billion
BUFFALO WILD WINGS in transactions in

USING DIGITAL
the second quarter
of 2017 and $9

TO EASE THE CUSTOMER

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doubling year-
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EXPERIENCE
“Venmo is much
less a peer-to-peer
platform than it is a
An early adopter of many technol- social experience,”
ogies available to the restaurant said Dan Schulman,
CEO of parent
industry, Goldade has his eye on
PayPal. Users check
other digital players, especially Venmo multiple
when it comes to the trends that are times a week to see
still emerging, such as payment and who friends are
personalization. paying, he said.
“Making personal payments is
like eating; it is something our guests “I am watching what Nike is doing with its digital experience and
do every day. So Apple and Venmo
have been focusing on driving great
commerce ecosystem and think they are setting a high standard
convenience with compelling inter- for any big traditional brand that wants to cross over into the digital
faces. This, in turn, drives greater space. Especially in the area of personalized experiences based
adoption and engagement,” he says. on users’ actual behavior and preferences. They have connected
“I believe we will see similar drivers
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 ADVERTISER INDEX CLASSIFIEDS

COMPANY PAGE WEBSITE

Anchor Appetizers 5 mccainusafoodservice.com/
brand/anchor
Basic American Foods 26 baf.com
Bevolution Group 7 tropics-beverages.com
Blount Fine Foods, Inc. 14-15 blountfinefoods.com
BUNN 37 bunn.com
Bush Brothers & Company 20, 21 bushbeansfoodservice.com
ConAgra Foods, Inc./ 19 angelamia.com
Angela Mia
Custom Culinary, Inc. 24, 25 customculinary.com
Dole Packaged Foods, LLC 9 dolefoodservice.com
Elite Bank Card Solutions 47 atmwholesaler.com
Firehouse Subs 4 firehousesubs.com/franchising
Hatco 29 hatcocorp.com
Jennie-O Turkey Store C2-1 jennieofoodservice.com/all-natural
Jones Dairy Farm C4 jonesdairyfarmfoodservice.com
Kikkoman Sales USA, Inc. 40-41 kikkomanusa.com
Monin 35 monin.com
National Restaurant 16 restaurant.org
Association
Red Gold, LLC 10, 33 redgold.com
Saputo Cheese USA Inc 44-45, 46 saputousafoodservice.com
Server Products 22 server-pumps.com
Stratas Foods C3 stratasfoods.com
Sysco Corporation 2 sysco.com
Texas Pete 30 texaspetefoodservice.com
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Bestselling authors, leadership
experts, TED speakers and more
will share their best ideas for
business and life.
34+
SESSIONS
No matter your career level,
goals or education, you will find
strategically crafted sessions to
engage and inspire you.
72+
HOURS
From networking to new ideas,
you will see an immediate return
on your investment for every
moment at Conference.

Full Pass - $1795 One Day Pass - $1295 REGISTER at aldc.wff.org

 AN INNOVATION ROAD MAP

THE BIG IDEA

Olive Garden asked a cross-
functional team—finance, marketing,
operations, communications and
others—to build on its Never Ending
Pasta Bowl promo.

“We sold 100

Each year, Olive to see how it did.” THE
Garden has
sold more $100
—JESSICA DINON, MANAGER
OF COMMUNICATIONS
START
passes—up to Dinon says the Pasta Pass isn’t as
22,000 last year— much about ROI as it is connecting
all selling out in
less than a second.
ROI with guests, and that it’s an example
of how Olive Garden has improved
communication with consumers.
YEAR
ONE

The promotion
has led the
chain to shift its
EVOLUTION
OF SOCIAL
MEDIA GROWTH OLIVE MEASURES
OF SUCCESS
Pasta Pass
guests came

GARDEN’S
marketing and in, on average,
social media voice 10 times
to “talk to guests In addition to the during the

NEVER ENDING
like real people,” one-second sell-out, promotion.
says Dinon. Olive Garden looks Most users
at social media brought other

PASTA PASS
volume and pop paying guests
culture references. with them
With only 100 passes across
840 restaurants that first year, during each
corporate made sure managers MANAGER visit.
remembered that the passes RESPONSE KNOCK-
existed—as well as the logistics
of how to process them. OFFS Olive Garden initially had to
GUEST address consumers saying the deal

“The success of it would be

REACTION was “too good to be true.” Same
with last year’s Pasta Passport—an
HOSPITALITY surprising and probably scary to
UPGRADE all-inclusive trip to Italy for $200.
other brands.” —DINON
Now, with
more passes
available, OTHERS CHAINS
Since Pasta Passes all general GO UNLIMITED
are personalized, managers
managers can get a Pasta
personalize the Pass to give
experience, Au Bon Pain’s Endless Smashburger’s
to one loyal
addressing the Coffee Mug: For $199, Burger Pass:
guest.
guest by name users get a mug for The $54 pass got
and making a free refills in 2018. users $1 burgers Knowing that the pass
connection. for 54 days. sells out in a second, and
that guests are watching
the clock, Olive Garden
now provides how-to-buy
information upfront.

48 R E S TAU R A N T B U S I N E S S J A N U A R Y 2 0 1 8
 Bacon doesn’t make everything better.

JONES BACON DOES. DRY AGED

If you have a BLT on your menu—or any sandwich with bacon for that matter—don’t skimp
on the star ingredient. Jones bacon is dry aged, and while it takes extra time, it results in
a subtly sweet and smoky flavor you can’t get anywhere else. Try our cherrywood smoked
bacon and taste how Jones can make even the most ordinary dish extraordinary.

For more information, or to request a sample, visit JonesDairyFarmFoodservice.com.

Or, contact Bryon Coleman at bryonc @JonesDairyFarm.com or (920) 691-0230.
© 2017 Jones Dairy Farm