Nation's Restaurant News On the Go Newsletter #57
Nation's Restaurant News
The #1 source of news and business intelligence for restaurant and foodservice industry professionals
Happy Friday all —?NRN editor-in-chief Sam Oches here.
One of my favorite moments from one of my all-time favorite TV shows is?from a season-four episode of “How I Met Your Mother”: Ted, the main character, utters casually, “We should buy a bar.” And his friend Barney ecstatically shouts (while flipping over their game of Monopoly), “Of course! We should buy a bar!”
I love that moment because it’s so real. Who hasn’t thought to themselves at some point or another, “I should buy a bar” or “I should start a restaurant”? The hospitality industry is, at its core, fun and creative, a source for great memories and joy. In our most excitable moments, the idea of being the boss of our own restaurant or bar sounds positively wonderful.?
While only a small number of people actually act on that impulse, it’s true that many restaurant concepts originate in flashes of inspiration, on the backs of bar napkins or over a game of Monopoly. NRN’s 2024 Breakout Brands have no shortage of great origin stories: There’s the A-list celebrity who wanted to take plant-based food to the masses, the group of franchisees who decided to do better as franchisors, and two separate groups of friends who brought their collective power together to make positive change. For all of these emerging concepts, a kernel of an idea bloomed into something big and impactful. Today they’re baby chains, but soon they could be household names.?
While we only chose eight concepts to occupy this year’s Breakout Brands, we know that every community in America has a business like this —?a founder with a dream, a business with the potential to change lives. The incredible mosaic of restaurant leaders across the country is helping the industry reach $1 trillion in sales in 2024, according to the National Restaurant Association. Even more impressive, these leaders are employing some 15.7 million people —?a staggering impact by any measure.?
Read through our Breakout Brands and the rest of this week’s content for your own inspiration. Maybe you’ll be motivated to start something new.
8 emerging restaurant chains that are ready for the spotlight
At some point in history, the word “chain” as associated with restaurants became something of a derogatory term. You could excuse customers of restaurants past for adopting a negative opinion of chains; once upon a time, the factory-style replication of restaurants within only a handful of cuisines failed to inspire good vibes for guests interested in anything beyond consistency and value.??
In the past two decades, however, chain restaurants have reinvented themselves and reclaimed the term. There’s now a wonderful diversity of concepts that have graduated to that “chain” moniker, scaling creative and delicious ideas into multiunit success stories. Seemingly every community in America has that home-town favorite that struck gold and opened in another community, then another, rallying local customers to their cause.
All chains start somewhere, and with Breakout Brands, Nation’s Restaurant News set out to find those baby chains that have just begun their scaling journey
Chipotle proves traffic gains are possible in this environment
Chipotle’s Q4 2023 results far exceeded expectations, as well as the industry at large, with Tuesday’s report showing a same-store sales increase of 8.4%. Revenue increased 15.4% to $2.5 billion, while restaurant level operating margin increased to 25.4%, or about 140 basis points.
The company also opened a record 121 new restaurants during the quarter, 110 of those in the Chipotlane model. The highlight of the company’s report, however, was its transaction gain of 7.4%. This is compared to a 1.6% decline across the limited-service segment in the quarter, according to Placer.ai data, as well as negative traffic recently reported by both Starbucks and McDonald’s.
U.S. restaurant industry expected to pass $1 trillion for the first time
The National Restaurant Association released its annual State of the Industry report today with the sales forecast as its top headline;?the association expects to exceed $1.1 trillion in 2024. Should this forecast play out, it will mark the first time sales from the nation’s second-largest private industry will tip into the trillions.
Last year, the foodservice industry forecast was $997 billion, while the pre-pandemic forecast from 2019 was about $863 billion, illustrating a staggering growth trajectory throughout the past four years despite a global black swan event. Of course, much of these sales have been driven largely by pricing; menu prices peaked at an 8.8% year-over-year increase in March 2023, but have since started to cool a bit and were 5.2% higher in December.
This Valentine’s Day, breakups and heartbreak are on the menu
Restaurant marketing promotions for Valentine’s Day have become fairly predictable, from the classic heart-shaped pizzas and biscuits, to special romantic date night deals from sometimes unexpected places, like White Castle’s returning upscale feast on Feb. 14th. But this year, multiple foodservice brands are capitalizing on the darker underbelly of the sweethearts’ holiday: heartbreak.
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Pizza Hut announced on Feb. 6th a new Valentine’s Day offering called “Goodbye Pies” where customers can enter to win a chance to send a breakup pizza to their significant other. Pizza Hut is taking this opportunity to promote the brand’s new hot honey pizzas, so that the unlucky recipient of the “sweet but spicy” news will receive a free hot honey pizza as a consolation prize.
P.F. Chang’s meanwhile, announced a deal for ex-lovers on the other side of the breakup. Starting Feb. 7, the Asian-American restaurant chain is offering free DUMPlings for anyone that has been broken up with via text, through Feb. 21 (which is apparently National Breakup Day).
Insomnia Cookies is offering this Valentine’s Day season a breakup box of cookies called the “It’s not you, it’s me” pack. This customizable 12-pack of cookies allows the heartbreaker to pick from one of four messages to send to their soon-to-be ex-sweetheart, ranging from “It’s not me, it’s you” to “I have the hots for your roommate,” and the creatively cookie-themed “you’re sweet but not my flavor.”
How Hooters is preparing for two of its biggest days of the year
Next week’s marketing calendar is enough to make any full-service dining chain nervous or excited. Or both. The Super Bowl and Valentine’s Day fall within a mere three days of each other, meaning two major traffic influxes essentially back-to-back.
Of course, this isn’t the first time there’s been such a tight squeeze (in 2022, the two were one day apart) but it doesn’t make the task at hand any less daunting. For Hooters, the main focus is on the Super Bowl, the 410-unit chain’s busiest day of the year. That’s not to say, however, Valentine’s Day isn’t a priority. ?
“We know we need to take advantage of all those people coming to watch the game and pick up their orders by telling them we also have something happening in three days. It’s a great bounce back opportunity,” Hooters CMO Bruce Skala said during a recent interview. “It’s a fun promotion to say, ‘we’d love to see you back,’ through bag stuffers, promotional in-store merchandise. We’re targeting everything.”
To entice football fans, Hooters hosting a season ticket sweepstakes for the chance to win 2024 season tickets to watch their favorite NFL team play. Additionally, dine-in customers can take advantage of the Post-Season Pick deal – 10 wings, curly fries and a Bud Light or fountain drink for $16.99. Bud Light pitchers are also available for $11. To-go and delivery customers can choose from 75 boneless wings for $65, 75 boneless wings for $85, or the Quarterback Sack – 50 boneless and 50 bone-in wings for $100.
Meanwhile, Valentine’s Day is what Skala calls a good opportunity to promote the brand and its “unique promotions.” This year’s promotion provides a new twist on the “Spin the Bottle” game in which on-premise diners will be invited to play the “Hooters Game of Love” at a prize wheel for the chance to win rewards such as $1 wings, free appetizers, and more.
LAST CHANCE! RESTAURANT TECHNOLOGY SURVEY FOR RESTAURANT OPERATORS
Nation’s Restaurant News Intelligence is conducting its second annual?Restaurant Technology Survey to explore how digital innovation is shaping the future of foodservice. If you are a restaurant operator we want to hear from you. Take our short survey and you'll have a chance to win an Amazon gift card. You'll also receive premier access to our Restaurant Technology Market Leader Report including survey results.
Welcome to NRN’s Burger Showdown!
In this showdown, we are pitting eight burger?chains from all over the country against one another. Which burger chain do you think has the most exciting concept Burgerville, LLC , Hat Creek Burger Company , Hopdoddy Burger Bar , MOOYAH Burgers Fries and Shakes , Next Level Burger , Savvy Sliders , Smalls Sliders , or Wayback Burgers . Vote your favorite by Monday!
EXTRA SERVING PODCAST: Chipotle’s big numbers, the future of beef, and Valentine’s Day promotions
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