If ever there was a "Fast & the Furious: Restaurant Edition," it would be a video recap of the past week. Few roller coasters could match the swerves, whooshes and twists. The industry saw big revelations (a bruiser of a brand moving into breakfast), the first ripples of an operational upheaval (a shift in how restaurants are staffed), a flashback to far rosier times (why not go public now?), and bizarre politics arising outside the Beltway. And did we mention the rejection of the shiny new thing in tech? (An order-and-pay-ahead app? Feh.)
Click ahead for the IMAX version of the retrospective.
1. Shake Shack to give breakfast a try
The high-volume retro concept revealed this week that it will start serving a.m. fare next Tuesday at its original New York City unit, the model for all that have followed. Shake Shack has offered breakfast before, at its airport and train station locations. But the Madison Park store will be the first street-side branch to feature a line of egg sandwiches. GrubStreet.com reported the morning menu will also include a sour-cream coffee cake that’s a specialty of Daily Provisions, the new food shop from Shake Shack founder Danny Meyer, as well as apple turnovers from a New York bakery with a cult following, Four & Twenty Blackbirds.
There’s been no word yet about other units adding breakfast service.
2. New wave of IPOs on the horizon?
Despite the industry’s current traffic woes, neither investors nor operators can forget the reception Shake Shack got on Wall Street two years ago with its initial public offering. The excitement revved up the concept’s valuation to $1.6 billion. At the time, the chain had 63 stores and a net profit of $5.4 million.
Reports this week suggested Cafe Rio, the 100-unit fast-casual chain owned by the private-equity firm KarpReilly, may be looking at an IPO. KarpReilly is the former owner of The Habit, another operation that was enthusiastically gobbled by Wall Street.
Also possibly heading for a stock offering: Pret A Manger, the grab-and-go urban concept that was once controlled by McDonald’s. The current owner, London-based Bridgepoint Advisers, has confirmed that it’s exploring a U.S. stock offering for Pret, which has 74 stores on this side of the pond.
Meanwhile, Jack in the Box says it’s exploring options for its secondary concept, Qdoba, though most observers say a sale to a private party is a stronger possibility.
3. Red Robin’s renegade approach to preordering
Like every other restaurant chain, the burger specialist is exploring alternative ways of taking orders. But one of the routes it’s pursuing is far outside the usual, and definitely retro. Instead of relying on an app, where customers place the order themselves, the chain has set up a centralized call-in center, akin to what pizza chains did eons ago for the sake of efficiency. Patrons call a number and give their order to a real person.
“Given our level of customization on gourmet burgers, we find that most guests still prefer to speak to a human to ensure their unique instructions are captured accurately,” CEO Denny Post explained to investors.
The order is then relayed to the kitchen display system of the restaurant used by the customer. The arrangement is currently in place at 98 units, and the chain is “slowly expanding reach of this service to ensure quality experience, adding up to about 50 locations at a time while measuring the financial impact as we go,” Post said.
A complementary marketing effort is also relatively low-tech. Commercials and all consumer communications carry a graphic reminding customers that orders can be placed to go. After six weeks, online orders had jumped to 15% of total sales, Post revealed.
4. New restaurant position: Takeout/tech facilitator
Restaurants’ intensifying focus on takeout and technology is birthing a new restaurant position: Facilitator.
The title is usually sexier than that—Guest Experience Leader, in the case of McDonald’s units in Canada, or simply To Go Specialist, in the instance of Red Robin. Whatever the person is called, the responsibilities are similar: helping guests place their orders, particularly carry-out ones.
Ironically, one of the first operations to establish the position, Buffalo Wild Wings, is phasing it out. The Guest Experience Captain is now gone from 90% of company-operated stores, a casualty of the chain’s effort to reduce labor costs by $15 million to $17 million. “A significant portion of that was the Guest Experience Captain role shift and then the reinvestment into front-of-house labor,” CFO Alex Ware told financial analysts.
5. NYC looks to ban polystyrene again—sort of
It’s deja vu all over again for restaurants in the Big Apple, where polystyrene takeout containers were banned for all of three months back in 2015. In case you blinked during that stretch, city officials banned the familiar packaging because it wasn’t recyclable. Then, after restaurants and packaging companies sued, a court ruled the clamshells really could be reclaimed and repurposed into something else. The ban was vacated in a flash—but with the qualification that a study be done to gauge how recyclable the containers really were.
Fast forward to this past week, when that study was finally published. It found that recycling polystyrene really wasn’t practical, so civic authorities introduced a bill reinstating the ban in November.
On the same day, the City Council took up an alternative bill that would declare Styrofoam to be part of the city’s ambitious recycling program.
The fate of the dueling bills was still pending at post time.