The old adage holds that a smart business turns lemons into lemonade. In the case of Danny Meyer, restaurateur extraordinaire, it’s more a matter of switching from the ultimate “ghost restaurant” to a coffee play.
That’s not the only extraordinary business move to rotate noggins this week. McDonald’s once guarded its proprietary Special Sauce as if it was gold. Now it’s giving away 10,000 free bottles of the mix.
Meanwhile, San Francisco is allowing restaurants that flunk their sanitation exams to have another go—for a fee.
Read on for more developments that might have slipped past you this week.
1. Umi stalls
One of the boldest restaurant experiments of recent years, the citizen-restaurant venture called Umi Kitchen, has suspended operations, according to a CNBC report. The New York City business was designed to function as a foodservice riff on Uber, with a cook’s services provided by everyday people using their kitchens to prepare favorite examples of true home cooking. Customers used an app to order the food, which was then delivered via a third party.
Umi was the ultimate example of what was first known as a nonrestaurant restaurant, then a headless restaurant, and now, under tag that’s gaining favor, a ghost restaurant. There was no dedicated kitchen, no dining room, no 1-800 number and virtually no other permanent features of a regular restaurant.
The operation, which launched in September, also drew attention because one of its founders was the daughter of New York restaurateur Danny Meyer, who was one of its financial backers.
The principals said they needed to suspend operations because the economic model wasn’t working, but intend to come back with a second go.
2. Meanwhile, let the java flow
Almost simultaneous with the disclosure about Umi, Meyer’s Union Square Hospitality Group announced that it was investing in another restaurant venture, the New York “third wave” coffee bar chain Joe Coffee.
USHG noted that its catering operation has been using Joe Coffee for years and is familiar with the founder of the now 14-unit operation, Jonathan Rubinstein.
Joe Coffee is known for providing warmer hospitality than many of its super-premium coffee competitors. A similar service orientation is one of USHG’s attributed marks of distinction.
News reports noted that Joe Coffee uses Danny Meyer’s definitive book on service, Setting the Table, as its training manual.
3. McDonald’s is doing what?
There was a time when certain things were sacrosanct to McDonald’s. You didn’t mess with the Big Mac, you didn’t tolerate other parties getting their hands on the sandwich’s Special Sauce, and you didn’t gamble on product quality for the sake of promotional benefits.
This week, the chain turned those sacred cows into two all-beef patties.
Selected markets introduced two riffs on the Big Mac: the Grand Mac, featuring two oversized (i.e., 5-ounce) beef patties, and the Mac Jr., which uses standard-sized beef rounds but omits the middle slice of bread that’s integral to the regular Mac.
But the big news is how those areas are promoting the new sandwiches. Yesterday, the chain gave away 10,000 bottles of its Special Sauce—the Russian dressing-like condiment that tops the Big Mac—to customers who told staffers taking their orders, “There’s a Big Mac for that.”
Now comes word that a Big Mac vending machine will be set up one day next week in Boston. Users who provide their email addresses will be rewarded with any of the three Macs that are now available.
The departures from McDonald’s former caution are part of the chain’s search for another sales pop akin to rolling out all-day breakfast last year. The chain’s same-store sales for the fourth quarter slipped for the first time in more than a year, and it attributed the decline to tougher comparisons.
4. San Francisco sells health inspection do-overs
A test underway in the Bay Area would provide restaurants with a second chance if they flunk a routine sanitation inspection. Local health authorities offer to go through the safety check again—provided the place is willing to cut a check.
The local health department stresses that restaurants aren’t buying a higher grade. Rather, for a fee of $191, an establishment can be reinspected within 30 days of getting a bad grade. The city contends that the approach encourages establishments to correct their safety problems quickly, and fosters the dialogue that can change standing operating procedures.
5. The culprit in restaurants’ traffic declines
The industry has struggled to explain why traffic has been sliding in fits and starts since the second quarter of 2016. Now we may have an explanation. New research shows it comes down to consumers forgoing a visit or two to their favorite restaurants because the prices are just too high.
The solution is focusing on light users, the data suggest. If the infrequent visitor could be coaxed into frequenting a restaurant just one more time a year, the industry would stand to gain $1.1 billion in additional sales, says The NPD Group.
A recent report from the company found 75% of all restaurant guests have cut back, and the majority of those because of price.
So long, HoJo’s?
The nation’s lone remaining Howard Johnson’s restaurant is for sale, according to a local news report.
The story says it’s unclear if the restaurant in Lake George, N.Y., is remaining in operation as the real estate is being hawked. The owner says he’s merely shifted to winter hours, but no one was answering the phone at the family dining site.
A sale could mean the final curtain for the brand, which was once the industry’s leading full-service chain, with more than 500 branches operating under a bright orange roof.