The big restaurant news of the week wasn’t nearly as much fun, or often as telling, as the details that leaked about various chains’ growth strategies. Was anyone actually surprised that Greg Creed got the nod to succeed David Novak as CEO of Yum! Brands? But who knew Famous Dave’s was a significant player in the architectural antiques business, or that the inventor of a bigger smash than the CroNut was tying on the apron again to concoct the sort of menu blockbusters that can transform an unknown brand into a consumer heartthrob?
Here’s what you might’ve missed while your head was turned by news out of Louisville or Panera Bread’s home base of St. Louis:
What Creed’s successor will have to deliver: Tweaks and tune-ups didn’t spare Taco Bell from a stinker of a first quarter, heaping more pressure on the chain to succeed with the last big initiative of outgoing president Creed, the addition of breakfast on March 27. So what would constitute success from Taco Bell’s perspective? Raising breakfast’s portion of total unit sales to “mid to high single digit” levels, CFO Pat Grismer revealed during an analysts’ call.
The task should be akin to spearing fish in a bucket, according to outgoing CEO David Novak. Taco Bell’s most avid fans “compose 75 percent of the heavy breakfast users—it’s an amazing number,” the 61-year-old remarked.
But not everything is so rosy. Novak remarked that he’d recently visited Taco Bells in Phoenix, where breakfast has been available for two years. “What was startling to me was how many people didn’t know we were in breakfast until we launched our new advertising,” he said.
Grismer noted that operating profits were already reduced five percentage points by an unexplained “franchisee incentive” related to the breakfast rollout.
Creed’s successor as president of Taco Bell has yet to be named. But he’ll likely be eating a lot of breakfasts as he strategizes how to hit Yum’s targets.
Father of the Bloomin’ Onion, ideating again. A press release issued by the Latitude 360 dining-and-entertainment concept merely announced that Outback Steakhouse co-founder Tim Gannon would be joining the upstart’s board. But a note from Latitude’s investor-relations rep went a bit further. “He’ll also be creating signature dishes for the venues,” Rob Rinderman said in an e-mail.
Gannon is credited with the creation of the Bloomin’ Onion, a battered and deep-fried onion that looks like a flower because of the way it’s prepped and cooked. Patrons were instructed to pull off the “petals” and dip the pieces in a sauce.
The appetizer cost peanuts but sold for a premium because of its novelty and inherent appeal. It was a critical differentiator for Outback in the chain’s early days, and virtually every major casual-dining chain eventually copycatted it. Latitude estimates that the Bloomin’ Onion has generated at least $1 billion in sales.
Latitude is an aspirant in a fast-growing segment consisting of large entertainment venues that also feature at least one restaurant. Going beyond a Dave & Buster’s, the entrants usually feature a number of entertainment activities under one roof, including movies, bowling, dancing and playing video games.
Latitude’s three units feature all of the above, plus what the company describes as a polished casual-dining venue.
In that respect, it’s in the same vein as Pinstripes and Beacher’s Madhouse.
Famous Dave’s ultimate yard sale. One of the many strategic moves set in motion by Famous Dave’s acting CEO Ed Rensi is the development of a more contemporary prototype for the barbecue chain. Right now, many of the stores look like B.B. King’s riff on a T.G.I. Friday’s, with all kinds of blues and BBQ kitsch adorning the dining rooms.
Turns out those artifacts were supplied by the company itself, not some hyperactive eBay peddler. Rensi announced this week that he ended the company’s sideline business of selling architectural antiques and décor accents to its stores. “We should not be a system supplier,” he said.
Exiting that business meant shutting a warehouse where the whacky neon signs and other décor elements were stored. That move alone will save the company more than $300,000 annually, Rensi said.
CroNuts creator tries a new one. These developments are academic because the world is unlikely to withstand the cataclysm of the waffle craze aligning with CroNut mania and the continuing buzz over super-premium coffee. Why were physicists mute this week about the debut of the Waffogato, the latest from New York City baker Dominique Ansel?
The Waffogato consists of a waffle-shaped block of ice cream that’s studded with pieces of Belgian waffle and tapioca and doused with hot maple-flavored espresso. The coffee melts the ice cream, yielding a loose take on the affogato, an Italian dessert of espresso-topped ice cream. As the concoction melts, bits of Belgian waffle and the tapioca are liberated from the ice cream block, yielding what a few lucky tasters have characterized as a milkshake.
That wouldn’t have elicited so much as a yawn from the foodie community if the creator was someone other than Ansel. If he hung up the toque today, he’d go down in history as the creator of the CroNut, the croissant-doughnut hybrid that’s been the biggest craze in the New York food world since the mojito.
The biggest acquisition you didn’t hear about. A 370-unit chain of Mexican restaurants with a cult following for its fresh, hand-made tacos was part of a multi-billion-dollar acquisition this week, but few restaurateurs would even recognize the name. That’s likely to change as Laredo Taco Co.’s deep-pocketed new owner expands the operation through development of the Stripes c-store chain, host to the tacquerias and the asset that’s changing hands for $1.8 billion.
The buyer is Energy Transfer Partners, the owner of 5,000 Sunoco gas stations. One of the stated rationales for the deal was bolstering the new parent’s sale of food and sundries to complement its gasoline business.
The seller was Susser Holdings, which has outfitted about two-thirds of its 575 Stripes c-stores to date with a Laredo Taco Co. The food stations feature tortillas made on premise and used for Mexican staples like soft tacos and fajitas. The outlets sell breakfast, lunch and dinner.
Bonus head-spinner: Sunday is International Respect for Chickens Day. The organizer, United Poultry Concerns, suggests commemorating the occasion with an office party, a classroom event or “simply talking to family.” Enough said.