The daily special

On a busy night at Houston's in Manhattan, the server approaches with menus, a wine list, and something new. A hard-backed card with six featured items, including soup, fish, and veal. "We have some great selections for you this evening," he says, grinning. "The sea bass and halibut are great."

Ah, the daily special. The kitchen's custom hodgepodge with a fancy name, hawked at tableside or on table tents. Oldest idea in the book, right?

Think again. For the country's casual-dining chains, it's starting to look like the newest thing in town. Houston's adopted the specials card just six months ago, and many more are waking up to the power of the daily plate. Red Lobster began offering specials last year, as did Rainforest Cafe (which plans to offer more), and Stuart Anderson's is adding to existing ones. Houlihan's and Olive Garden, meanwhile, are planning to start them soon. They're realizing that specials—freshly prepared, limited-time, off-the-menu dishes—have many benefits. Everything from image enhancement to frequency building to an overall competitive edge are all in the writing on the blackboard.

"I'm surprised it's been taking as long as it has for chains to understand that this is an opportunity to differentiate your menu," says Dennis Lombardi, executive VP of the restaurant consulting firm Technomic. "A lot of customers are saying, 'Hey, these menus are all the same.' "

It comes as no surprise, then, that the reasons chains give for offering specials include distinguishing themselves to compete more effectively. Orlando, FL-based Red Lobster, which added a daily fresh fish special last year, knows it's no longer the only fish in the pond. "Seafood is growing in non-seafood competitors. Outback is doing salmon," explains marketing director Andrew Dun. "We see this as a key way for us to compete in the broader category in the future." At Corte Madera, CA-based Il Fornaio—which recruits its chefs from Italy—marketing VP Michael Mindel says, "We think it distinguishes us from other Italian chains. But secondly, we compete with the independent chef-owned restaurant. Our goal is to present a true personality, much like an independent."

How much? Il Fornaio's chefs can turn out as many as 13 specials a day, and the quest for independent-like cache is not limited to them. Phoenix-based Houston's puts its kitchen managers' names on the front doors and offers up to six specials daily, sometimes with selected wines and single malt scotches.

"It highlights a better degree of culinary expertise," Red Lobster's Dun says, "It tells the consumer that this is freshly made for them and it's not coming out of a big chain." Hopkins, MN-based Rainforest Cafe began offering a daily fish special this year and expects to expand the specials offering to other menu categories this summer. "It talks to the humanity of the kitchen. We're not a production kitchen," COO Greg Carey says, adding that it also shows the guest, as an independent would, "that the restaurant cares enough to go out of its way."

That can have rewards both in frequency of visits and in winning new ones. "One, it helps you appeal to a broader audience," says John Miller, president of Dallas-based Romano's Macaroni Grill, which has always offered daily specials. "It provides the higher culinary offering. You don't want a person to veto a visit because they want something more avant garde. Two, it's a frequency builder for the person who comes often." Such reasoning is currently on the table at Olive Garden, where management is thinking of introducing some variety of daily special into the Orlando-based 460-unit chain. "We have a lot of regular guests and it keeps the offerings fresher to be able to offer the daily specials," says spokesperson Cathie Weinberg.

Whether chains actively reap these benefits or not, some say specials are simply an outgrowth of consumer demand. "What's happened is the dining guest today has higher expectations than in the past," Carey says. "They want more options." "Guests like specials," seconds Cooker's new culinary director Patrick Bouffard, who is in the process of expanding the West Palm Beach chain's daily offerings. "Guests like something that's new for that day, something the chef created that morning."

Unfortunately, the guests wouldn't always be correct. While chains' daily specials are usually not Tuesday's brisket that becomes Wednesday's stew, some are not really all that special, either. In fact, what passes for the daily special ranges from a bona fide invention off the top of the cook's head (as in Il Fornaio's case), to a standard menu item that simply appears off the menu, dubbed a special. And while both extremes (and every shade between) can have benefits, those can vary in proportion to the risks. Guests may love the idea of a fresh and spontaneous item, but chains wrestle with control issues.

In response, most operators have developed systems which allow for some spontaneity within a framework presided over by headquarters. At Macaroni Grill, for example, all specials are scheduled by a 16-member "culinary council"—including the executive chef and COO—after considering ideas submitted by the individual units. Miller recalls back when Macaroni Grill's chefs pretty much made free in their respective stores. That ran into trouble as the chain grew: "We knew that there was no way to build brand equity if no other chefs knew how to make one chef's dish. To add to that, it was troublesome for people to go from one store to the next and have one dish called different things."

Specials can also spell trouble for chains when it comes to purchasing. To retain volume-buying power, Cooker, for example, only approves specials that can be made from ingredients stocked in the central commissary. Other chains—like Macaroni Grill—plan a seemingly spontaneous special far enough out that it's basically like buying for the regular menu. In fact, the chain's "daily" specials are changed weekly. "There's no strategic purpose to change it every day," Miller says. "You can't get the buying power for a quality product."

Meanwhile, while the majority of Macaroni Grill's chefs take their specials orders from headquarters, there is a small coterie of "validated" chefs who are allowed some expressive freedom after passing various criteria: "They go through a submittal and approval process and when they can follow criteria for taste, presentation, value, profit consistency, they're allowed a certain leeway," Miller says.

Indeed, trusting chefs with the brand identity is the stickiest issue for chain operators offering daily specials. Most have adopted a middle-of-the-road approach which allows the chefs or kitchen mangers to choose from a company-approved list of recipes. At Cooker, Bouffard is presently building a "living document" of approved recipes which the units will have to adhere to in offering specials. At Los Altos, CA-based Stuart Anderson's, which has gradually been expanding its lunch specials offerings over the last two years, chefs do their own daily fish special, selecting and combining freely 11 approved species, 40 compound butters, and a variety of sauces. "When I came here I got a sharp pain in my chest thinking about this," says F&B director John Haywood, "But I haven't had to pull the reins in."

San Fransicso-based Chevys Fresh Mex, which has done a daily fish special for years, recently put its recipes and cost parameters on a company Intranet to streamline the process. "There's a set menu pricing grid that goes with cost per pound," says marketing VP Bruce MacDiarmid. "They stay within established price ranges and cost percentages." Recently however, Chevys has decided to approve several of its kitchen managers to do some of their own recipes.

At Red Lobster, the kitchen manager and general manager plan the daily specials one week out and 90% of the daily fish specials come from approved recipes (most of these work with more than one fish species, to allow for flexibility). But the kitchen is allowed to flex its creative muscle—so long as the numbers are as palatable to headquarters as the dish is to customers.

Rainforest Cafe, which also lets its chefs pretty much wing it with the daily fish specials, has an "involved format" of price structures. "If they buy for this, they have to price for this," says Carey. "We gave them the parameters because we couldn't be 100% confident. We suggest the items and give guidelines. If you go outside, that's fine, but here's where it has to come in financially, consistent with the margins we expect."

Chefs, however, can still run amok. Il Fornaio had a little trouble awhile back when some concocted native Italian dishes as specials which might have been better left in the mother country. "What's authentic isn't always what sells," relates Michael Mindel. "We've learned the hard way about tuna eggs, sweet breads, and tripe. But even when it's a mistake, they learn from the experience."

Still, if benefits can be had with company-controlled specials just the same, why would chains bother with chef autonomy at all? "One premise I go by," offers Technomic's Lombardi, "is if you allow your people to continue to learn, you have a better chance of keeping them." Many back him up. "It's a bonus that they can have some expression and empowerment," says Miller of Macaroni Grill's chefs. Chevys' MacDiarmid says "Most of them like to have an outlet for their own creative talents." And Il Fornaio's Mindel offers: "Frankly, I don't think many would stick around if all they could do is prepare company dishes."

Difficulties aside, operators point to two other strategic advantages in offering the daily special, and one is cold cash. When asked, most maintain the pricing structures of specials are in line with similar entrees. Most of the time, building frequency—offering the regular customer a reason to come a little more often—seems to be the primary goal. But Rainforest's Carey points out that "at the end of the day we're businessmen and women. We make decisions based on margins. If we can get a great deal on a product and sell it at the right price, we can make a lot of money."

John Haywood at Stuart Anderson's says that while margins aren't his primary goal in specials, they're attractive for other reasons. "It gives me a highly flexible, low cost, low risk way to test new lunch items," he says. "It's been tremendous at that." He adds that the next wave in industry growth may well be led by the humble daily special: "The way to drive growth will be product innovation as opposed to unit growth—the industry has matured in terms of that. Product innovation has become more important and daily specials are a way we test new items. So the need to meet guest desire for more specials is a plus. It gives us a chance to test with little risk because the guest is willing to take a risk."

And as chains become increasingly willing to take a risk in the kitchen, some who watch from the sidelines see specials as part of a larger trend. "All the chains strive to maintain that independent feel," says Houlihan's marketing director Chris Lewis. He says after the new menu roll-out this fall, the 101-unit chain will start running a daily special. "It's on our radar screen," he says. "It's the un-chain chain thing to do."


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