Let’s keep this between us, but restaurants have been known to swipe an idea from time to time. Like Monday through Sunday. It is a business of copycats, which explains why the industry apparently borrowed the signature expression of a well-known hotel operator as its rallying cry for the week.
Here’s how the industry attempted to better itself—read: make more money—by cleverly campaigning for goodwill and buy-in, using such unlikely fodder as taxes and scanty outfits.
1. Tax benefits of an unexpected sort
Hands down, the topic of the moment for restaurateurs is how the new tax codes will impact the business. Children tossing in their beds on Christmas Eve show less excitement about what’s coming. The possibilities made it a theme of the recent ICR Conference, and yet the particulars are still largely unknown, as the IRS acknowledged this week with the release of new payroll withholding schedules.
In the middle of that heated speculation, Sonic Drive-In turned heads with its response to the tax changes. It sees the lower federal levies as an opportunity not only to sell more burgers and shakes, but also as a chance to accelerate expansion. The franchisor intends to remind franchisees at their upcoming conference that a really smart thing to do with the higher profits left by the cuts would be to open more stores and invest in the existing ones.
“It is our objective to try to show them their profits are best utilized by following the business,” CEO Cliff Hudson revealed to investors. “I wouldn't want to try to lay it out for you today that we have a basis for saying that's what will happen to this money. But clearly, we will be talking to our operators about whether to reinvest.”
Sonic is not the only franchisor who hopes franchisees will use the proceeds from the tax cuts to open more stores. The International Franchise Association is asking its members—brand owner and individual operator alike—to reinvest the savings in expansion.
2. A truce in the burger wars
Burger King mounted another snark attack on archrival McDonald’s this week, taunting the 600-pound gorilla with a new burger intended to trump the fresh-meat Quarter Pounder that McD’s has in the works. But outside of the United States, BK proved it actually has a soft spot in its heart for the Golden Arches.
In Argentina, the flame-broiling specialist stopped selling Whoppers for a day and encouraged patrons to buy a Big Mac instead. The occasion was McHappy Day, an annual McDonald’s promotion where all proceeds from the sale of Big Macs are donated to children suffering from cancer.
BK did get off a salvo by referring to its competitor as the place that doesn’t flame-broil its burgers, but the gesture still drew acknowledgement from McDonald’s.
Its smaller rival has about 110 locations in Argentina. The olive branch was actually extended several weeks ago, but the situation did not come to light until recent days.
3. Standing up for lobsters
Kinder hearts apparently prevail in many overseas markets. Look at Switzerland, where a new law is forcing restaurants to show more humanity and consideration for the lobster.
It is now a crime there to boil the crustaceans without first putting them to death through other means. No doubt assisted suicide would be the preferred choice.
Nor can live lobsters be transported on ice or in ice water. The medium for transit has to be salt water at ocean temperature.
The measures are part of a new effort to promote animal welfare.
4. Hooters’ buttoned-up delivery
Restaurants worry that delivery service will short-change customers on the overall experience that endears a concept to dine-in customers. But not Hooters.
Word spread this week of the chain’s singular benefit from delivery, an expansion of sales opportunities beyond the obvious. The attraction of delivery is especially strong for the breastaurant concept, Hooters of America CEO Terry Marks explained to investors at the ICR Conference, because any sleazy connotation of the brand is left behind. Dad can have his wings without catching killer glances from mom as the cleavage-showing waitress leans down to place the order on the table. Mom might also have fewer qualms about the kids enjoying the wings-and-breast chain’s food specialties.
“Many people wouldn’t step foot in our restaurants, but they want our product,” Marks was quoted by The New York Post as telling the audience of investors.
About 96 of Hooters’ 427 restaurants currently offer delivery, Marks said. “Delivery and pickup orders is what we have been focusing on,” he said.
5. Bitcoin, bit by bit
Restaurants have been happy to remain on the sidelines of bitcoin mania, with good reason: The practicality is just not there. In December, the Wall Street Journal dispatched a reporter to buy a pizza in New York City from anyplace that would accept a bitcoin. The closest he could come was bartering a fraction of his cryptocurrency for a Domino’s pizza through a third-party app; the chain (and virtually all of its competitors) would not accept the coin directly. Under the current exchange rate and the accompanying fees, the reporter paid $76 for a $9.47 pie through the middleman service.
But that situation may be changing. One of the industry’s best-known owner-operators indicated this week that bitcoins may soon be accepted by the likes of Morton’s, Mastro’s, Mitchell’s Fish Market and even Bubba Gump Shrimp Co.
Those brands are all owned and operated by Tilman Fertitta, who told Money magazine that his Landry’s Restaurants empire is investigating the feasibility of accepting the virtual currency.
“We try to always be on the cutting edge,” he told the media brand. “If I’m a betting man, I’m expecting [it] is here to stay.”