Social media has become the focal point in many restaurant marketing efforts, but the battlefield for consumer awareness has become clouded with a growing number of platforms and a limited amount of resources.

Foodservice companies remain intent on getting their message heard, however. In the NRN Restaurant Operators Survey released in January executives said they planned to increase marketing spending this year and that social media would get the lion’s share of marketing efforts. About 47 percent of survey respondents said social media was the most important part of their 2012 marketing campaigns.

And consumers are poised to accept marketing messages delivered via social media, according to the National Restaurant Association’s 2012 Restaurant Industry Forecast. Released in February, the study revealed that nearly one third of consumers said they would be likely to sign up as a follower on Facebook or Twitter if a restaurant made its specials available on those platforms.

The NRA forecast also found that more than nine out of 10 operators said their restaurant will likely be using Facebook in the next year or two, with use of Twitter and smartphone applications expected to rise as well.

To make it easier to sort through the growing number of social media offerings, Nation's Restaurant News identifies some of the most useful social media sites for marketing and gives tips on how restaurants can use them.

Facebook

Facebook continues to be the platinum standard for social media, providing a platform for its 900 million users to share information about themselves and people and places they like. A few more women (58 percent) engage on Facebook than men (42 percent). Restaurateurs, big and small, can create a page to connect with fans of the brand and potential customers and even conduct polls and contests.

For restaurants:
• Include photographs to draw attention to the posts (250 million photos are uploaded daily to Facebook).
• Engage the brand community by asking questions or seeking input on new menu items.
• Offer promotions, and even ordering, through special tools.
• Learn more about your brand’s fans with Facebook Insights data.

More:
• How restaurants can leverage the new Facebook Timeline format
• Take a look at Starbucks’ Facebook Timeline

Next: Twitter and Foursquare

Previous: Facebook

Twitter

This microblogging platform, with posted messages limited to 140 characters, has more than 470 million accounts registered and sees more than 175 million tweets a day. In June 2012, the service began to offer “expanded tweets,” which provide previews of content, images and videos from its partner sites. Search functions for the tool are also becoming more robust.

Users access Twitter through the Twitter.com website (64 percent), through smartphone applications (16 percent), and through a Twitter client (10 percent) like TweetDeck, HootSuite or Seesmic.

For restaurants:
• Interesting content gets retweeted, as does humor.
• By using a Twitter client that allows for monitoring a brand name or handle, restaurants can easily see compliments and complaints and either address the problem or show the user appreciation.

More:
• Morton’s answers fan’s Twitter request
• Take a look at McDonald’s on Twitter

Foursquare

The geolocation-based networking platform for smartphones was updated in June with more robust “Explore” functions that are based on the habits and sentiments of the user's connected friends. The revised app now allows and highlights user comments, tips and suggestions, and was redesigned with more emphasis on users’ photographs. Foursquare passed 20 million users in April 2012.

For restaurants:
• Because users check-in when they are near a location, restaurants can use the app to provide special offers. Chili’s Grill & Bar has offered free chips and salsa for check-ins, and Zoes Kitchen has offered 10-percent discounts.
• Operators can also devote special attention to frequent users, such as the most-checked-in “mayors,” by offering discounts or free items.

More:
• Kona Grill builds buzz with Foursqaure ‘swarm’ party

Next: Instagram and Pinterest

Previous: Twitter and Foursquare

Instagram

The social photo-sharing site, which gives smartphone users a variety of filters to make their pictures look even more professional, was purchased earlier this year for $1 billion by Facebook. Introduced in 2010 for the iPhone and expanded in April 2012 to the Android platform, Instagram has about 40 million users who upload about 58 photos every second.

For restaurants:
• Restaurant operators can post photographs of daily specials.
• Photographs of in-store promotions based around special holidays and events can be posted and shared by both restaurants and customers as they are planned or happening.

More:
• How restaurants can make the most of Instagram

Pinterest

Appealing to ease and simplicity, Pinterest is akin to a bulletin board shared with friends and acquaintances. The site, which was introduced in 2010, skyrocketed to more than 12 million monthly unique visitors early this year.

The minimalism of posting photos and links to photos makes the interface simple to use both through a web browser toolbar or a mobile app. The demographics are heavily weighted toward women; about 97 percent of the site's “likes” from Facebook come from women.

Food is the No. 1 content category on Pinterest, according to a Citigroup Global Markets study released in July 2012, making it a logical platform for restaurants.

Taco Bell this summer has hired an intern for Pinterest, which the company calls a “Pintern,” who is tasked with finding interesting photos from various Taco Bell units and posting them on Pinterest. And Pizza Hut debuted its Pinterest board in early July 2012.

For restaurants:
• Pinterest is an ideal way to highlight appealing photography from a restaurant's blog or website.
• Operators large and small can use Pinterest without much time invested.
• Restaurant brands with many units should hire a dedicated staff member. Taco Bell this summer has hired an intern for Pinterest, which the company calls a “Pintern,” devoted to getting interesting photos from various units and posting them on Pinterest.

More:
• Pinning down Pinterest
• Take a look at Pizza Hut’s Pinterest board

Next: Google+ and YouTube

Previous: Instagram and Pinterest

Google+

Search-engine giant Google launched the Google+ social network in June 2011, and it is expected to hit 400 million users by the end of 2012. The site has a much different user demographic than Pinterest; about 67 percent of its users are male.

The interface is similar to Facebook, but users (who must sign up for a Gmail account) organize contacts in “circles,” allowing messages to go to specific groups of like-minded contacts rather than broadcasting to the entire following. And because Google owns the brand it provides opportunities for postings to increase search engine optimization.

For burger brands that have a large following among young men, Google+ is ideal. Savvy users of the platform include Hardee’s and Carl’s Jr., which are know for their attractive female spokesmodels and provide provocative imagery on the Google+ stream.

Google acquired Zagat late last year. This year, Google announced the roll out of Google+ Local, a location-based tool that combines previous Google+ features, such as sharing content with circles, along with Zagat scores and recommendations from fellow Google+ users.

For restaurants:
• Google Places is now Google+ Local. Check to make sure your restaurant is up-to-date on the new features and how they affect your restaurant.
• Independent restaurants should try to maximize the new localized search and reviews.

More:
• Learn more about Google+ Local (Google)

YouTube

Restaurant chains have found YouTube as an important communication platform. YouTube is the third most-visited site after Google (No. 1) and Facebook (No. 2), according to Alexa, a web information company. And it’s the world’s second largest search engine after parent company Google, which bought the platform in 2006 for $1.65 billion.

The viral nature of YouTube and its ability to embed videos across many platforms has led even foodservice chains to springboard off popular topics, such as Dallas-based Red Mango’s recent introduction of a Honey Badger flavor that was marketed through social media.

YouTube draws more than two billion views a day, and about 44 percent of YouTube users are between ages 12 and 34.

For restaurants:
• Restaurant companies can post their television commercials to get more viewers.
• The site’s search functions are used intensely, so brand names and celebrity spokespeople can be highlighted.
• Behind-the-scenes videos of new store construction or new design can be posted.
• Keep the videos brief. Average YouTube video duration is 2 minutes and 46.17 seconds.
• Executives can provide crisis communication videos, such as how Taco Bell responded to a lawsuit, later dropped, over its meat content.

More:
• Red Mango creates flavor based on Youtube video
• Behind the scenes look at a McDonald’s photo shoot from McDonald’s Canada
• Taco Bell supports its beef in new ad

Contact Ron Ruggless at Ronald.Ruggless@Penton.com
Follow him on Twitter: @RonRuggless
 

Every year around late spring, they start cropping up on menus: Lobster rolls, the iconic summer sandwich that originated in New England. In the last few years the East Coast favorite has become even more popular, appearing on more menus — and in more variations — all across the country.

According to market research firm Datassential's MenuTrends, which tracks over one million different menu items at more than 7,000 chain and independent restaurants, lobster rolls have grown steadily and appear on 52 percent more menus that just four years ago. They can now be found on 2 percent of menus where sandwiches are offered.

With an average cost of more than $15, the premium crustacean-filled sandwiches are most often found at fine-dining restaurants, where they appear on 6 percent of sandwich menus, according to Datassential. The next most popular place to find lobster rolls is casual-dining restaurants, where 3 percent of sandwich menus feature them. The sandwich appears on less than 1 percent each of midscale and quick-service menus.

Though the rise of the pricey roll has coincided with the economic downturn, many restaurateurs aren’t surprised that the sandwich is gaining traction.

Chef Jasper White has been serving lobster rolls in his restaurants since the 1980s. At his Jasper White’s Summer Shack restaurants he currently serves a classic Maine-style roll made of lobster meat with homemade mayo and cucumber on a buttered, griddled split hot dog bun.

“If you look at a lobster roll, it’s a pretty humble creation,” said White. “The contrast between the warm griddled buttered bun and the cool refreshing lobster salad … It’s just this understated elegant dish that fits with the New England character.”

The humble-meets-luxurious nature of the sandwich is part of what prompted LEV Restaurant Group to open Lobster Me, a fast-casual eatery dedicated to the crusty protein, last year in Las Vegas.

“When times are bad people want to spend on things that feel good,” said Zachary Conine, head of development for LEV Restaurants. “With the lobster roll it’s a way for people to get access to a thing that’s a little higher end.”

Though traditional lobster rolls still reign, a host of restaurants, including Lobster Me, have begun using the sandwich as a vehicle for delivering bold, ethnic flavors or variations on the theme. Lobster Me, for example, recently rolled out three new ethnic options: The Cajun, featuring Cajun spices, seasoned mayo and fresh lemon; the Diablo, warm lobster with spicy marinara sauce; and the Lobster BLT, which tops lobster with applewood smoked bacon, mayo, lettuce and chopped tomato.

Smaller versions of lobster rolls are showing up at menus across the country at places such as 5 Napkin Burger, a chain with locations in New York, Boston, Miami and Atlanta. The seven-unit chain offers Lobster Roll Sliders that consist of lobster with mayo, scallions and cucumbers on mini brioche rolls. And Devon Seafood Grill, with five locations in Pennsylvania and Illinois, offers Mini New England Lobster Rolls with chilled lobster salad and watercress on buttered, toasted sweet rolls.

Other chains are adding lobster rolls to their menus as limited-time offers. Among them is Uno’s Chicago Grill, which is promoting a lobster roll for its third summer. This year, the chain is offering the new Lobster Melt featuring Cabot aged Cheddar cheese on top of lobster meat with mayo and scallions served in a stirato roll. Also doing a lobster roll LTO is 99 Restaurant. The New England-based chain recently introduced the Colossal Lobster Roll, which is lobster meat blended with mayo and celery and served on a grilled roll topped with shredded lettuce.

Though the pricey rolls appear the least in the quick-service segment, several chains lately have added their versions to menus, also as LTOs. For example, in March, Quiznos rolled out the Lobster and Seafood Salad Sub, featuring lobster and seafood salad with lettuce on buttered toasted artisan bread. And in June, Au Bon Pain began offering a Lobster Salad Sandwich, which is lobster meat tossed with light mayo in a buttery croissant.

A Wetzel’s Pretzels founder is poised to launch a new fast-casual pizza concept called Blaze Fast Fire’d Pizza that targets the growing niche for quick artisan pies.

Rick Wetzel, cofounder and president of Wetzel’s Pretzels with his wife Elise Wetzel, developed Blaze, which has a slew of high-profile investors, including former California First Lady Maria Shriver, movie producer John Davis and Boston Red Sox co-owner Tom Werner.

The first Blaze restaurant is scheduled to open in August in Irvine, Calif., near the University of California–Irvine campus. Two more units are planned to open before the end of the year, in Pasadena and West Los Angeles. Wetzel said he plans to grow the chain through franchising once the concept is established.

Blaze joins a growing number of pizza concepts vying for fast-casual positioning that borrows elements from Chipotle Mexican Grill, with its customizable menu and dishes prepared in front of guests as they walk a service line.

Others targeting the niche include 800 Degrees in Los Angeles; Pieology in Fullerton, Calif.; Mod Pizza in Seattle; and Uncle Maddio’s in Atlanta.

Wetzel said he sees an opportunity in offering artisan-style pizzas with a quick Chipotle-like format, a trend that he predicts will cause a “seismic change” in the estimated $35 billion U.S. pizza industry.

Guests at Blaze, for example, will walk to the counter where housemade dough will be pressed into a pan. Guests can either “co-create” their pizza by selecting from among about 40 toppings — from crumbled meatballs and gorgonzola to barbecue sauce and pineapple — or choose one of nine pre-designed pizzas.

As guests pay and get drinks, their pizza is cooked in an 800-degree open-hearth oven, and takes about two minutes to bake.

Wetzel said most 11-inch pizzas will be priced at $6.85, while a plain cheese pizza will be about $5.

The crust, which Wetzel described as thin and crispy, was created by executive chef Bradford Kent, owner of Los Angeles’ acclaimed Olio Pizzeria & Café, who was hired to help develop the menu and ended up “joining the team as a partner,” Wetzel said.

Wetzel pointed out high-end pie makers like Mario Batali's and Nancy Silverton’s Pizzeria Mozza in Los Angeles, where consumers have learned to love artisan and Neopolitan-style pizzas. Blaze aims to make such quality pizzas available for a quick lunch and for less than $10.

The first Blaze location will be about 2,600 square feet with 90 seats. The design, by Ana Henton of MASS Architecture and Design, will be contemporary, but with “soul.”

“I really wanted it to be something my friends would walk into and say, ‘This rocks,’” Wetzel said.

Based in Pasadena, Calif., the company estimates that Blaze locations will average about $2 million in sales, Wetzel said, adding that it will target busy lunch locations such as shopping malls.

Wetzel, who founded the 250-unit mall-based Wetzel’s Pretzels chain with Bill Phelps in 1994, said he has nearly two decades of experience in franchising, marketing and brand development, and he’s confident that the Blaze concept could be a national brand despite the growing competition.

“I’ve been through the pretzel wars, even though we might have been the 20th guy in to that game,” he said. “It was cutthroat for a lot of years, but we survived in the end by executing well.”

As with better burgers, high-quality fast-casual pizza as a growing category will more likely make value-oriented delivery chains like Domino’s nervous, he said.

“Who’s going to want to eat Domino’s if enough companies come along that do pizza really well?” Wetzel said.

Contact Lisa Jennings at lisa.jennings@penton.com.
Follow her on Twitter: @livetodineout
 

As executive chef of City Crab and Seafood Company in New York, Joe Vaina is committed to bringing an authentic Maryland crab house experience to the heart of the Big Apple. And with Maryland blue crabs in peak season, Vaina said business is booming at the 20-year-old restaurant.

“We are true to our concept,” said Julie Orchier, director of marketing and promotions at Branded Restaurants, the restaurant’s parent company. “We are a crab house in Manhattan. We are bringing you the ocean in the heart of the city.”

Vaina, who spends so much time at the restaurant that he likes to say he lives there, recently sat down with Nation’s Restaurant News to talk about flying in crabs from Alaska, his simple preparations, and the importance of wild-caught fish.

Tell me about the Alaskan King crab promotion you held in March.

There’s a local vendor I deal with who deals directly with the people out in Alaska. When we have the opportunity we bring in the live Alaskan King crabs or the live Alaskan Snow crabs. They come directly from Alaska, fly into Newark or JFK [airports], and are driven directly to the restaurant. They range from seven to 10 pounds, and people can come in and pick them out of the tank. They’re difficult to get because they don’t travel well, but we get them whenever we have the opportunity. Next week we’re getting the Snow crabs. We always keep one as a mascot for the tourists.

Do they sell well?

Yeah. We get a limited number, like six or seven, and we sold out of them in three days.

What else is big on your menu this summer?

We’re doing a lot of stuff with the Maryland blue crabs. This is really the month when they are coming into their own — getting nice and fat. July, August and September are the best month for them.

How do you prepare them?

I have a secret recipe, but the standard way of preparing them is with Old Bay and your favorite beer. You steam them in brown paper and then start smashing and eating.

This is clearly a place where you come to eat crab, but what else is selling well?

Salmon is always a huge seller, as is our sushi-grade tuna. It’s a hard question to answer because everything sells so well. And our preparations aren’t with a lot of heavy sauces and aren’t in a French style. It’s a true, authentic New England crab house style. I think that enjoying the ocean’s natural flavors is something that people really enjoy here.

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You’re big on getting everything local, right?

Yeah, I try to get everything here. And everything we serve is wild. I don’t use anything farm raised.

Why is that?

I’m a big fan of sustainability and giving back to the ocean so it’s here for the next generation. I’m just not a fan of farm raised. There is a different level of flavors when a species is eating in its natural environment. It’s a little more expensive, but people who understand fish come here to enjoy the flavors from the rivers and the oceans. Not too many restaurants can say they have all wild fish.

News programs often come to you as an authority on seafood. They came to you when the Gulf oil spill occurred, for example. Why do they choose you?

I’m very involved in my field. I work 90-plus hours a week. I really try to stay on top of what’s going on, from sustainability to current events that effect the ocean, and I do my research. I want to give my customers the freshest and best fish and crabs I can. I think that’s my responsibility. I like to keep my customers informed and myself informed. In any business it’s important to know everything about your product.

In your opinion, what is the current state of the seafood industry? Do you have any concerns?

I have a couple of concerns, which is my driving force of staying up on sustainability. I just did a documentary about Chilean sea bass, which is very endangered. They came to me because they know that I don’t serve it all the time. I only serve it when it is in season. I feel a sense of responsibility.

Do you see any exciting new trends happening with seafood right now?

I’m trying to create some trends. I’m really pushing the wild-caught fish. It’s treated more humanely and its freshness and quality exceeds everything else out there. That’s what I really want to see catch on, from earth to table. Also, people are eating a lot of different things with scallops. They are huge right now.

What’s the best thing on your menu?

I’m a huge fan of our scallops. My crab cakes have won so many awards. I have people from Maryland that come here and pull out their driver’s licenses and say this is better than home.

Contact Charlie Duerr at charles.duerr@penton.com.

Pizza Patrón, the Dallas-based chain focused on serving the Hispanic consumer, has come to expect generating a large public reaction with its Spanish-language promotions — along with major lifts in sales and traffic — and its latest offer, “Pizza Por Favor,” was no different.

The June 5 promotion offered a free large pepperoni pizza to any customer who ordered in Spanish. Pizza Patrón gave away 80,000 pizzas during the one-day promotion, including 50,000 during the three-hour window it advertised plus another 30,000 in free-pizza coupons given to people still waiting in line after supplies ran out and business hours closed.

The chain sold plenty of full-price pizza as well, brand director Andrew Gamm said in a statement, as 25 percent of Pizza Patrón’s locations broke weekly sales records the week before and the week of the promotion.

Redemptions of the offer far exceeded expectations, and lines for the promotion queued out the door for hours at many locations, Gamm added.

“Our plan was created to address a maximum of 30,000 pizzas, based on the capacity of our stores for any given three-hour period,” he said. “However, we underestimated the crowds, and many franchisees kept giving out free pizzas after the event hours.”

By crafting promotions speaking specifically to its core demographic of Hispanic consumers, Pizza Patrón has courted controversy and criticism from conservative groups. The Conservative Caucus, an organization that advocates for English as the official national language of the United States, criticized “Pizza Por Favor,” and on the day in May when the promotion was announced, somebody hacked into Pizza Patrón’s email servers.

The chain’s previous controversial campaign, a “cultural promotion” in January 2007 to accept Mexican pesos as payment for its pizza, spurred similar national criticism from some groups, as well as thousands of phone calls and emails, some of which contained death threats.

In a previous interview with Nation’s Restaurant News, Gamm said the national media coverage and the good will from the chain’s regular customers far outweighed any part of the controversy. That month, Pizza Patrón’s same-store sales rose 50 percent, and the brand accepted more than 1 million pesos, Gamm said. The chain’s same-store sales rose 34 percent for the first quarter of 2007.

Previously, Gamm had said Pizza Patrón also planned a new ad campaign for 2012 that would accentuate customers’ Hispanic heritage further, and toward the end of the year the brand is planning another promotion with its philanthropy partner, St. Jude Children’s Research Hospital.

“The [Pizza Por Favor] campaign achieved its goal of solidifying our unique position in the marketplace and strengthening our relationship with the Hispanic community,” Gamm said in his statement. “We are very proud of our Latino brand focus, and we remain unapologetic of our commitment to this community.”

Pizza Patrón has 104 company-owned and franchised restaurants in seven states, with more than 80 locations under development.

Contact Mark Brandau at mark.brandau@penton.com.
Follow him on Twitter: @Mark_from_NRN
 

Scott Foster has been named chef of record at Bennigan’s Franchising Company. Currently he is the managing partner and executive chef for Nova Restaurant Group, which operates four restaurants in Minnesota, and partner and executive chef for Pier 500 restaurant in Hudson, Wis. Foster previously was on the opening team of Maggiano’s Little Italy and was the first executive chef of Lettuce Entertain You Enterprise’s concept Big Bowl.

Chad Hudson, who was the kitchen corporate trainer for Fox Restaurant Concepts’ five-unit True Food Kitchen, based in Scottsdale, Ariz., is the new executive chef of Breeze Bar & Café at the Nantucket Hotel & Resort on Nantucket Island in Massachusetts.

Hudson also had a stint as the personal chef of actor Kevin Costner.

Jeffrey Lunak is the new vice president for culinary at the six-unit Blue C Sushi and three-unit Boom, both in Seattle. Most recently the corporate chef for the Morimoto restaurants, Lunak has been charged with lending “cutting edge and thoughtful flavors” to the Japanese-inspired menus of both concepts, according to a company spokeswoman. He also is responsible for training and continuing education of all of the restaurants’ chefs.

Chuck Courtney is the executive chef at the Menlo Grill Bistro & Bar in Menlo Park, Calif. Most recently executive chef of The Bistro at the Park in Lafayette, Calif., the Los Angeles native is now dishing up items such as his signature Cheddar chive biscuits with jalapeño honey butter, as well as kale lasagna, and Berkshire pork chops with applejack barbecue sauce and Brentwood corn mashed potatoes.

Australian chef Michael Wilson, who most recently was the chef at Cutler and Co. in Melbourne, which Australia’s Gourmet Traveller magazine’s Restaurant Guide named that city’s best restaurant in 2010, has moved to Shanghai, China, where he is executive chef of Jing’An Restaurant at The PuLi Hotel & Spa.

Sue Drabkin, the former executive pastry chef at the Inn at Perry Cabin in St. Michael’s, Md., is the new executive pastry chef at Ris in Washington, D.C. A native of New Haven, Conn., Drabin, who also designs jewelry, is baking such desserts as apricot Bing cherry galette with toasted almonds, vanilla ice cream and red wine sauce; and Basque cake with strawberry rhubarb compote, walnuts and brown sugar ice cream.

Richard Mills is the new chef de cuisine at the English Grill at the Brown Hotel in Louisville, Ky., where he is working with executive chef Laurent Geroli to develop a new menu that will be introduced later this summer. Most recently the sous chef at Ravello at the Gaylord Opryland Resort & Convention Center in Nashville, Tenn., Mills specializes in butchering and curing meat. “My cooking philosophy is that less is more,” he said. “I let the ingredients speak for themselves without crowding the plate.”

Contact Bret Thorn at bret.thorn@penton.com.
Follow him on Twitter: @foodwriterdiary
 

Wall Street analysts on Friday praised Darden Restaurants Inc.’s decision to acquire the growing Yard House chain, saying the hip, young brand will be a spark within the largest casual-dining operator’s more mass-market portfolio.

Orlando, Fla.-based Darden said Thursday that it has agreed to buy Yard House USA Inc. for $585 million in cash in a deal expected to close in Darden’s second quarter.

Following the announcement, most analysts argued that Yard House would certainly benefit from Darden’s resources as the largest casual-dining operator in terms of scale, supply chain and operational strengths, as well as its access to real estate. Others pointed to the upside for Darden.

"Yard House fits well within their portfolio and has no operational (i.e. distraction) impact on the core brands," wrote Jeffrey Bernstein of Barclays Capital Inc. "And we should not forget the expertise Yard House offers Darden’s portfolio, such as successful bar operations and targeting a younger demo."

The high-grossing draft beer chain was sold by private-equity firm TSG Consumer Partners LLC, based in San Francisco, which acquired a 70-percent stake in Yard House in 2007 for an undisclosed price. At the time, Yard House had 16 locations.

Irvine, Calif.-based Yard House will join Darden’s growing Specialty Restaurant Group, which includes The Capital Grille, Bahama Breeze, Seasons 52 and Eddie V’s.

The sale price represented about 1.5 times the estimated fiscal 2013 revenues of $368 million for Yard House, or 12.5 times the earnings before interest, taxes, depreciation and amortization of $44 million, the company said.

In a slew of reports Friday, some Wall Street restaurant analysts noted that the price was higher than the dining transactions of late, which tend to be around eight- to 10-times EBITDA. However, they were not surprised, given the Irvine, Calif.-based chain’s strong performance and the scarcity of “new generation,” polished, casual-dining brands that would meet Darden’s high standards.

Paul Westra of Cowen and Co. estimated Yard House’s valuation at $685 million, including $265 million for existing units in 2013, plus “growth potential” worth about $420 million.

"We view Yard House as one of America’s best-positioned polished-casual dining concepts," wrote Westra, "sitting atop a group of higher-end concepts poised to take massive market share from aging mass-casual competitors as Baby Boomers continue to shift their dining-out preferences toward better environments where they can control the pace of their dining experience."

Founded in 1996 in Long Beach, Calif., Yard House is known for its wide selection of beer — most restaurants have more than 130 beers on tap with a wide selection of both traditional and international brews, as well as craft and specialty beers. Yard House claims an impressive 39 percent of its sales from alcohol, which is among the highest in casual dining.

About 57 percent of sales come from food, and Yard House is also acclaimed for its broad eclectic menu, developed by one of the founders, Carlito Jocson.

Darden also noted that Yard House restaurants play great music. For years, Yard House founder Steele Platt personally selected the classic-rock music playlist for the chain.

The average check is about $20.43. Dinner is the chain’s biggest daypart, accounting for about 46 percent of sales, with 22 percent from happy hour, 21 percent from lunch and late night accounting for about 11 percent.

Yard House has an average unit volume of $8.4 million from a typical footprint of about 10,500 square feet. But Darden noted that the 10 most recent restaurants that have been open a full year averaged $9.7 million in annual sales.

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Darden officials said they see significant “white space” ahead for Yard House, saying there is an opportunity for at least 150 to 200 restaurants nationally. In addition to the 39 open across 13 states currently, three more Yard House locations are under construction and the company has another five leases signed and four more letters of intent.

Analyst Bryan Elliott of Raymond James wrote Friday that Yard House will likely play a key role in Darden’s top-line growth goals “as the core Olive Garden and Red Lobster concepts approach their ultimate footprint potential within the next few years.”

Darden officials said earlier this year the company would continue to fortify its portfolio, and rumors have circulated for months that Yard House was among Darden’s possible targets. Speculators had also pointed to BJ’s Restaurants Inc., and California Pizza Kitchen as other possible acquisition options.

Last November, the company acquired the Eddie V’s upscale seafood brand along with three Wildfish Seafood Grill restaurants for $59 million, which also joined the Specialty Restaurant Group. And Darden bought Rare Hospitality International Inc., and its LongHorn Steakhouse and The Capital Grille brands, in 2007 for $1.19 billion.

Some say Darden isn’t done yet.

One analyst sees Bravo Brio as a possible acquisition target in future, though probably not until 2014 or 2015, after Yard House is integrated into the Specialty Restaurant Group.

“We still think Bravo Brio possesses desirable attributes for a longer-term strategic acquisition by Darden," Stephen Anderson, senior analyst with Miller Tabak & Co. LLC, wrote Friday. "Early-stage expansion (less than 100 units currently versus a long-term goal of at least 300 units), exposure to higher-income demographic groups, and a high incidence of alcoholic beverages as a percentage of total sales (21 percent).”

The Yard House acquisition will grow Darden’s Specialty Restaurant Group by about 50 percent, with estimated annualized sales increasing from $632 million pre-deal to an estimated $959 million, based on 2012 data. Darden on Thursday maintained its fiscal 2013 outlook, saying same-store sales would be up between 1 percent and 2 percent.

The after-market news Thursday sent Darden’s stock on a downward trend Friday after opening at $49.64 and dipping by about 13 percent by midday.

Anderson of Miller Tabak & Co. LLC, speculated that some investors may be concerned about Darden being distracted from efforts to turn around sales at its largest brand, Olive Garden, which accounts for about 40 percent of sales. Others saw the deal as a wise strategic move for the future.

“How smart they are,” said Gary Levy, director of the hospitality industry practice for J.H. Cohn LLP. “Darden is looking at its company and saying, ‘We have these brands, and they’re not growing the way they used to. So what can we grow?’”

The sale of Yard House leaves TSG Consumer Partners without a full-service restaurant player within its portfolio, though the private-equity firm last year bought a stake in the Stumptown Coffee Roaster chain, based in Portland, Ore., and reports said it planned to grow that brand.

Contact Lisa Jennings at lisa.jennings@penton.com.
Follow her on Twitter: @livetodineout

Editor's note: This exclusive series to Nation’s Restaurant News provides C-level insights into the sales and traffic data from clients subscribing to Black Box Intelligence, a financial performance benchmarking company. The views expressed here do not necessarily reflect those of Nation’s Restaurant News.

After an unstable performance so far this year from the restaurant industry, operators and investors have been asking, "Is it the economy or is it me?"

I'll give you Black Box Intelligence's read on this perplexing situation — starting with the numbers, as we always do, including both the Restaurant Industry Snapshot for June and the second quarter.

Industry same-store sales rose 1.5 percent and traffic fell 0.6 percent in the month of June. For the second quarter, same-store sales rose 0.7 percent and traffic fell 1.6 percent.

The volatility of the quarter was pretty wild, as we reported a 1.3-percent increase in same-store sales in April, a 0.4-percent decrease in May and a 1.5-percent increase in June.

Our partners at Consumer Edge Research reported the same kind of volatility in their Restaurant Willingness to Spend Index. In April, the index registered at 83, increased in May to 88 and then dropped back down again in June to 81.

[The Restaurant Willingness to Spend Index is set at a base line of 100.]

I should note that the Restaurant Willingness to Spend Index has been predictive of what the following month's sales direction would be 23 out of 26 months. Unfortunately, this suggests a difficult July is coming. I wish I could say it isn't so.

The data also suggests that consumers are positive about the decline of gas prices but are looking for value by controlling their spending. Survey results indicate that such actions as leaving a smaller tip and using a loyalty card that offers discounts became more common from the beginning of the quarter to the end of it.

As I mentioned last month, there is a softening in each of our segments and in publicly reported quick-service restaurant companies.

In the People Report data we see increasing pressure on hiring and a concern about the impact of new health care laws. This will provide even more volatility for operators as we anticipate and make adjustments to react to the reality of this legislation.

On a more long-term view of same-store sales, we are tracking 2009 sales declines offset by the gains in 2010, 2011 and 2012.

Given the marginally positive same-store sales growth in the third quarter of 2011, it should be relatively easy to maintain positive same-store sales through the third quarter of 2012, although there is still significant ground to recover from the lows of the third quarter of 2009. Another obstacle for the third quarter of 2012 will be the Summer Olympics taking away dine-in sales, which creates a great opportunity for restaurants to bolster to-go transactions and offset a potential drop in overall sales.

Additionally, we saw the check/transaction average move down, suggesting operators have slowed their price increases or are implementing more aggressive discounting. We remain concerned with traffic, which, as mentioned, dropped 1.6 percent for the quarter.

So who wins and who loses will be dependent upon operators' abilities to incorporate sustainable value into their offerings, manage expenses — especially human capital costs — and communicate clearly and effectively what the brand stands for in the eye of the employee and the marketplace.

What can you do?

Turn off the news, stop listening and reading economic reports, and go out to eat!

“The Restaurant Industry Snapshot” is a compilation of real sales and traffic results from 117 DMAs from 73 distinct restaurant brands and approximately 12,000 restaurants that are clients of Black Box Intelligence. Currently, data is comprised of casual dining (44%), upscale/fine-dining (32%) and fast-casual/family-dining (24%). Black Box Intelligence is a sister company to People Report, which tracks 1 million restaurant employees on workforce analytics. The Restaurant Industry Snapshot also includes the “Restaurant Industry Willingness to Spend Index” from Consumer Edge Research, which is a monthly household survey of more than 2,500 consumers. Consumer Edge Research is a marketing partner with Black Box Intelligence and People Report.

Wallace B. Doolin
Doolin is chairman of Thomas Doolin and Associates LLC, the holding company of People Report, the leader in human capital business intelligence for the restaurant industry and Black Box Intelligence. He is the founder of Black Box Intelligence, a state of the art business intelligence product for the restaurant industry. Additionally, Doolin serves as executive chairman of ESP Systems LLC, a hospitality and healthcare technology company. Other current responsibilities include public company board of director service for Caribou Coffee and Famous Dave’s. Previously, Doolin served as CEO of Carlson Restaurants Worldwide and TGI Friday’s.

This is a news release issued by Healthy Dining, a nutrition-related marketing and consulting firm.

Healthy Dining today joined the National Restaurant Association (NRA) in celebrating the one-year anniversary of the groundbreaking Kids LiveWell initiative. The celebration also marks the additional milestone of the program reaching more than 100 restaurant brands participating in the innovative, voluntary nutrition program that promotes dietitian-approved menu choices for America’s youngest diners and families.

“What an amazing year it has been for Kids LiveWell. We are gratified by the success of the program and applaud the participating restaurants’ commitment and their chefs’ innovations in developing creative menu options that appeal to the youngest diners’ taste buds, while maintaining sound nutrition,” said Anita Jones-Mueller, MPH, President and Founder of Healthy Dining. “Now families of all ages, from grandparents to parents to teens to toddlers, have even more choices to choose from on HealthyDiningFinder.com.”

“Kids LiveWell continues to build momentum and expand into new venues in every state across the country,” said Dawn Sweeney, President and CEO of the National Restaurant Association. “The industry’s positive response to customer demand is exciting to watch, and we look forward to what the next year will bring.”

As part of its joint collaboration with the NRA on this first-of-its-kind initiative, Healthy Dining provides its expertise and resources, including Healthy Dining’s team of registered dietitians, who identify and validate qualifying Kids LiveWell menu choices that feature fruits and vegetables, lean protein, whole grains and low-fat dairy. These qualifying kids’ meal options and the respective restaurants are then prominently featured on HealthyDiningFinder.com, the premier and award-winning restaurant search engine for reliable nutrition information, smart eating tips, healthy recipes and much more.

Jones-Mueller noted that the growth and success of the Kids LiveWell program is a reflection of the restaurant industry’s response to customers requesting more offerings of healthful options for kids, as well as adults. HealthyDiningFinder.com, which features the expanding list of Kids LiveWell qualifying menu items, has also witnessed a significant growth in its overall database of Healthy Dining-approved restaurants and menu options that can accommodate other dietary preferences, such as heart-healthy, diabetes-friendly and general reduction in fat, calories and sodium.

For more details on Kids LiveWell and other Healthy Dining information and resources, visit HealthyDiningFinder.com, or follow Healthy Dining on Facebook and Twitter.

In this weekly Commodities Watch column, John T. Barone, president and commodities analyst for Market Vision Inc., offers a snapshot of the state of commodities for restaurants.

While analysts were hinting at corn yield below 150 bushels per acre (bpa), few expected the USDA to drop their forecast from 166 to 146 bpa in last week’s monthly World Agricultural Supply and Demand Estimates (WASDE) report. The USDA reduced projected corn output by 12.3 percent, from 4.79 billion to 12.97 billion bushels. And while some drought damage is already irreversible, the jury on corn output can’t come in with a verdict until after pollination.

The USDA raised its 2012/13 corn price forecast by 28 percent, from $4.60 to $5.90. Corn futures went up to $7.75 last week before settling back to $7.55 on Friday. Any further deterioration in crop conditions would send corn prices higher again this week.

The situation with wheat is not so bad — yet. The winter wheat crop from the Northern Plains and Pacific Northwest is still in very good condition and close to harvest. Spring wheat conditions are declining but still in much better shape than corn.

Contact John T. Barone at jbarone@mktvsn.com.

Carmela “Mama” Sbarro, who, with her husband Gennaro, founded the Sbarro Italian quick-service chain more than 50 years ago, passed away July 7. She was 90 years old.

Born Dec. 15, 1921, she immigrated to the United States with her husband and three sons, Joseph, Mario and Anthony, from Naples, Italy. She and Gennaro opened an Italian deli at the corner of 17th Avenue and 65th Street in Brooklyn, N.Y., in 1956 called Sbarro Salumeria, which served authentic dishes she learned to prepare in Italy.

“She was an incredibly hard-working individual,” said Anthony Missano, president of business development for the Melville, N.Y.-based chain. “She was incredibly passionate and insisted on working at the counter every day from nine in the morning to eight o’clock every night.

“She worked very quickly and was able to deal with multiple customers at a time. People would come to the store just to see her.”

The success of the Brooklyn store prompted the family to expand to more locations in the New York area and eventually around the world. As the company expanded throughout the 1970s and 1980s, the original location was set up to be a commissary for other locations. According to Missano, Carmela was deeply involved in the commissary operations, overseeing the preparation of 1,500 to 2,000 cheesecakes a week.

“She would make the cheesecakes, cut them and put them in boxes,” Missano said.

As she grew older, however, the family tried to convince her not to work so hard, Missano said. “But she insisted and continued to work into her 80s. She was someone who didn’t shy away from work. Even when she was in her 60s, people had a hard time keeping up with her.”

From the shop she opened in 1956, the Sbarro chain has grown to more than 1,000 locations in over 40 countries.

Carmela Sbarro is survived by three sons, 13 grandchildren and 33 great-grandchildren.

Contact Paul Frumkin at paul.frumkin@penton.com.
 

Restaurant industry same-store sales and traffic rose in June, as quick-service chains maintained momentum and casual-dining brands snapped back to life after a difficult May, according to the latest NRN-MillerPulse survey.

MillerPulse, an operator survey exclusive to Nation’s Restaurant News, included respondents from 59 restaurant operators in July regarding June sales, profit trends, performance and outlooks. Respondents included operators from all regions of the country that represent the quick-service, casual-dining, fine-dining and fast-casual segments. Those surveyed in June represented restaurants that booked about 14 percent of industry sales.

Overall, industry same-store sales were up 3.2 percent in June compared with 3.1 percent in May, the survey found. Sales at quick-service restaurants, which include both fast-food and fast-casual brands, rose 3.9 percent in June, down from a 4.8-percent increase in May. On the other hand, full-service restaurants, which include both fine-dining and casual-dining brands, reported a 2.2-percent gain in same-store sales compared with a 0.9-percent increase, with both sub-segments showing improvement.

However, despite the uptick in full-service sales, the industry has reason to remain cautious, according to Larry Miller, restaurant securities analyst at RBC Capital Markets and creator of the monthly MillerPulse surveys.

“It was a pleasant surprise to see casual dining snap back, but we are concerned that overall sales remain soft, particularly in casual dining,” Miller said. “I think it speaks to the uncertainty consumers and business owners have regarding the direction of the economy.”

RELATED: 2Q outlook split between a weak casual dining, strong quick service

The survey also found that traffic increased at both quick-service and full-service restaurants for the month but remained soft compared with the early part of the year. Quick service reported a 1.9-percent increase in traffic in June, while full-service reported a modest 0.1 percent for the month.

Despite the mediocre month, operators remain optimistic that sales trends will improve in July. A net 20 percent of operators surveyed said they believed that same-store sales would be better in June than they were in July. That number was calculated by the net 42 percent of those surveyed who thought things would be better versus the 22 percent that thought things would get worse. The survey also found that operators from three out of the four segments — fast casual, casual dining and fine dining — thought things would improve over the next six months, with quick service being the only segment that felt things would get worse.

That being said, Miller remains concerned about the future.

“I think we are going to see more of the same: Volatility. Uncertainty. A continuation of industry same-store sales in the 2 percent to 3 percent range,” he said. “We're hopeful that as we pass these domestic hurdles — elections and the fiscal cliff — things will accelerate into calendar 2013.”

Register for MillerPulse at www.nrn.com/industry-insight.

Contact Charlie Duerr at charles.duerr@penton.com.

Famous Dave’s of America Inc. has opened its first Famous Dave’s restaurant outside the United States, a franchised location in Winnipeg, Manitoba, Canada, marking the next phase of its North American growth.

The Minneapolis-based chain of 186 barbecue restaurants foresees 400 to 500 locations across North America, including several in Canada, Mexico and Puerto Rico, where one location is expected to open by December. Chief executive Christopher O’Donnell said in a previous earnings call that the 100-unit variance depends on how quickly the brand expands with its fast-casual “barbecue shack” prototype over the next five to seven years.

In an interview Monday with Nation’s Restaurant News, he said Canada would be a “very strong market for us.”

“In Manitoba especially, people are familiar with Famous Dave’s from visiting or doing business in the Dakotas or Minneapolis, so we’ll have a strong client base,” O’Donnell said. “We’re learning a lot about their consumer, but Canadians seem to like Americana and they seem to like meat. They appear to be inspired by our sense of hospitality.”

Famous Dave’s is still observing how different economic situations affect Canadian consumers as well, but so far nothing has been too surprising, O’Donnell said. The chain cited rising gas prices’ effects on consumer traffic in its core Mid-Atlantic market when it reported negative same-store sales in its first quarter of fiscal 2012.

“In some ways, some of the pricing for general staples, at restaurants and in grocery stores, appears to be higher than in the States,” O’Donnell said. “But the Canadians seem accustomed to it.”

Famous Dave’s Winnipeg unit is the first location for Canadian franchisee Tribal Council’s Investment Group of Manitoba Ltd. That group has agreed to build three units and is considering another pact for more, O’Donnell said, while several other Canadian investment firms have begun inquiring into the Famous Dave’s brand.

Other casual-dining chains growing rapidly in the United States also have begun branching out into international markets, including Buffalo Wild Wings into Canada and Texas Roadhouse into the United Arab Emirates.

In addition to its first Canadian outlet, Famous Dave’s operates 53 restaurants and franchises another 133 units in 35 states.

Contact Mark Brandau at mark.brandau@penton.com.
Follow him on Twitter: @Mark_from_NRN
 

Slower same-store sales trends reported in March and April seem to have seeped into May and June as well, especially in the casual-dining segment, an industry analyst reported as many companies prepared to release second-quarter earnings.

Quick-service restaurants are showing some resiliency, said Andy Barish, equity analyst at Jefferies & Co. Inc., in a note he and his team issued last week that foreshadowed weakened second-quarter expectations.

“While the full service category is struggling, QSR restaurants appear to be holding up surprisingly well in the face of dwindling consumer confidence,” Barish said.

Quarterly earnings reports in the weeks ahead will reveal much about the first half of the year’s performance. Earnings releases are scheduled presently from such lare foodservice companies as: Yum Brands Inc. on Wednesday; Chipotle Mexican Grill Inc. on Thursday; BJ’s Restaurant Inc., Domino’s Pizza Inc., Frisch’s Restaurants Inc. and McDonald’s Corp. next Monday; and Panera Bread Co. next Tuesday.

Jefferies’ analysts were more optimistic about the quick-service and fast-casual segments than full-service. They cited casual dining’s “lighter top line” and its limits on margin leverage, especially when the industry faced lowered expectations for commodity costs easing and heightened uneasiness about the economy in general.

“While gas prices spiked in March and have since come down, sales trends across the full-service restaurant industry have decelerated,” the Jefferies team noted. They cited Knapp Track same-store sales data being down 0.3 percent in March, up 0.8 percent in April and down 1.3 percent in May. Traffic was down about 4 percent in May as well, the analysts noted.

RELATED: New June report shows casual dining sales rebound

“Customers continue to struggle with economic/employment uncertainty, and affordability and value matter more than ever,” the analysts continued. Despite aggressive discount and promotions in casual dining, they added, net traffic is flat to down.

For the rest of the year, Jefferies analysts see "persistent softness across full-service dining for those concepts without strong differentiation and/or solid value platforms," adding that those with "value, service and atmosphere at the forefront should continue to comp positively.”

Quick-service restaurants, however, “appear to be holding up surprisingly well in the face of dwindling consumer confidence,” Barish noted.

“We believe concepts are taking some share via menu innovation,” the Jefferies team said, citing Taco Bell’s Doritos Locos Taco introduction, Dunkin’ Brands’ coffee and breakfast sandwiches, and Burger King’s mix of premium and value offerings.

Although the Plan to Win initiative from McDonald’s has driven growth in the category in the past, the note said, sales for the chain are beginning to slow while smaller, regional players accelerate. “Additionally, we could be seeing some trade down from full-service, as well as some traffic via employment growth in lower-end service/minimum-wage jobs,” the Jefferies team said.

Margins in the second half of the year will likely face pressure as many companies had expressed hope for an easing of commodity cost inflation.

“We fear that prices may not be as favorable as previously expected, given that dry soil conditions and a persistent heat wave (Midwest) are currently threatening the grain complexes and reducing dairy output,” the Jefferies team said. “We knew protein prices would remain high through the year, particularly beef (double-digit inflation), but it now appears unlikely that gross margins will see material relief on the dairy and produce fronts moving forward.”

Contact Ron Ruggless at ronald.ruggless@penton.com.
Follow him on Twitter: @RonRuggless

Since 2005, Gerard Craft has been delighting St. Louis with his fine-dining restaurant Niche, which, like many fine dining restaurants these days, is known for its use of local, seasonal ingredients. Since then he opened the more casual Brasserie by Niche as well as Taste, which focuses on small plates and cocktails.

Craft also has won such accolades as being named a Food & Wine Best New Chef in 2008 and being nominated four times by the James Beard Foundation for the Best Chef in the Midwest award.

Now he has turned his attention to noodles, and in August plans to open Pastaria, where he will combine what he has learned from multiple trips to Italy — most recently with the specific mission of learning more about pasta — with the Midwestern bounty that he highlights at his other restaurant.

Heading up the kitchen will be Adam Altnether, who has worked with Craft since 2007 and who bought Taste from him in 2010, although Craft is still a partner in that restaurant.

The new venue will be a retail shop — offering pasta, local cheese, sauces, take-home meals and imported olive oils and vinegars — as well as a 112-seat restaurant with a 12-seat bar and 40-seat private dining room.

Pasta will be extruded and rolled in a front display window, showing how items such as ravioli, wide pappardelle noodles, and spaghetti alla chitara (“guitar spaghetti”) — so-named because the pasta is cut by pressing it through a row of wires that resembles a guitar — are made.

Craft said he expects the pasta display window to attract people’s attention. “The idea is to showcase great pasta dishes in a really friendly, unpretentious and affordable setting that tells about the traditions of Italy with the ingredients of the Midwest,” he noted.

“The first time I went to Umbria [a region in central Italy] it stood out how much like the Midwest it is — the landscape, the weather and a lot of the ingredients,” he said. Both Umbria and the Midwest specialize in beef and wheat, for example.

For an Umbrian dish called carne cruda (“raw meat”), Craft will be getting his beef from with Bethlehem Valley Winery in Missouri, which raises cattle on the side of the valley where it doesn’t grow grapes. The dish is made by dressing raw chopped beef with a little olive oil and salt, and served with preserved lemon and arugula for $10.95.

Rather than using 00 semolina flour from Italy Craft will be sourcing his flour from Kansas and Missouri. He will import the olive oil, however, from Tuscany and Abruzzo, and the balsamic vinegar from Emilia Romagna.

Craft said one thing he learned during his latest pasta-investigation trip was to keep it simple. “As chefs, when we come up with recipes we want to overcomplicate certain things, maybe because we have a huge toolbox," he explained. "But we don’t always have to use it."

Instead, Craft plans to make dishes like the tortelloni he had in Orvietto, which was made simply with seasoned ricotta, artichokes, olive oil and lemon juice. Craft is serving his rendition with parsley and Parmesan cheese for $15.95.

Other menu highlights include oven roasted beef meatballs with dates, tomato, polenta and Parmesan for $13.95, and wood oven–roasted chicken with seasonal bread salad for $17.95.

Contact Bret Thorn at bret.thorn@penton.com.
Follow him on Twitter: @foodwriterdiary
 

A new fast-casual pizza concept with an aggressive growth plan is launching in Las Vegas later this month, joining a growing crowd of operators who hope to claim the niche.

Project Pie, a concept founded by James Markham — who also helped found the MOD Pizza chain in Seattle and founded Pieology in Fullerton, Calif. — is scheduled to open in late July or early August in the MGM Grand Hotel on the Las Vegas strip.

The MGM Grand location will be the first of 20 Project Pie units to open over the next two years, according to Markham. “We’ll have six stores open within the next seven months,” he said.

A second location is scheduled to open later this summer in San Diego, and units are planned for the chain’s home base of Carlsbad, Calif., as well as Boulder, Colo. Markham is also looking for three to five locations in New York City, and Project Pie may go into more MGM-owned properties around the world.

A growing number of chain operators are hoping to claim the title of being the “Chipotle of fast-casual pizza,” including MOD, based in Seattle; Uncle Maddio’s in Atlanta; Top That! Pizza, based in Tulsa, Okla.; and the soon-to-launch Blaze Fast Fire’d Pizza, based in Pasadena, Calif.

Markham, however, said he was the first to bring the idea of artisan-style fast-casual pizza to market, using the model of allowing guests to choose their toppings for one price, watching the pizza being prepared in front of them, and seeing their pie cooked in less than three minutes in an 800-degree gas-fired oven.

Markham developed the concept after he built and sold a five-unit pizza chain called Knockout Pizzeria in San Diego, a more traditional New York-style pizza chain. He then moved to China for a few years to open New York Style Pizza in Shanghai. When he returned to the U.S., he said he wanted to develop a new quick-pizza concept in the style of Chipotle Mexican Grill.

That idea drew the interest of Ally and Scott Svenson, founders of the Seattle Coffee Co., who joined with Markham to create MOD — an acronym for Made On Demand — a now five-unit chain in the Pacific Northwest.

The first MOD opened in 2008 and was among the first of its kind. Markham, however, left MOD in 2009 to design another fast-casual pizza concept called Pieology in Fullerton, Calif., which opened in 2011.

Markham recently sold his share in Pieology to a business partner and went on to develop Project Pie. The fledgling chain has attracted the support of a deep-pocketed investor Joel Tucker, who Markham described as an entrepreneur with interests in the restaurant industry.

Project Pie will serve 12-inch pizzas for $7.50. Like Chipotle, the concept uses sustainable ingredients such as hormone-free meat and organic produce where available. Guests can choose from among seven pre-designed pies, or build their own pie.

The crust is thin and slightly more crisp than a traditional Neopolitan style, said Markham. A gluten-free crust option is also available, but it’s not safe for people with celiac disease because of the risk of cross-contamination.

A key differentiator for Project Pie is its 800-degree oven, now used by only a handful of the growing number of fast-casual pizza concepts. Most use an impinger conveyor oven, which Markham believes produces a very different product. “You lose the authenticity,” he said.

The first location will be about 1,800-square feet with seating for about 52. Markham described Project Pie’s design as “vintage industrial.”

Though the first 20 locations will be company owned, Markham said he plans to franchise the brand down the road.

Contact Lisa Jennings at lisa.jennings@penton.com.
Follow her on Twitter: @livetodineout

Casual-dining chain The Greene Turtle has launched a media campaign to promote its repositioning, including two television ads and a radio spot intended to indicate to its customers in Maryland, Virginia and Delaware that it’s more than a traditional sports bar.

One television ad, “Team,” features parents bringing groups of kids into the restaurant after a game to enjoy The Greene Turtle’s food and drinks.

Another commercial, “Compete,” highlights the bar scene, with adults jocularly arguing and otherwise being boisterous as upscale-looking appetizers and entrées are being served.

Both spots end with the 33-unit chain’s new tagline: “Feed your passion.”

So does the radio spot, promoting new items and a two-for-$14.99 special that allows customers to buy burgers, sandwiches and entrées at that price.

“Last November we started the process of brand repositioning, and this is the culmination of all that work,” said Chris Janush, The Greene Turtle’s vice president of marketing.

David Melnick, vice president and director of account management of Siquis, the agency that spearheaded the rebranding effort and produced the commercials, said The Greene Turtle’s repositioning was intended to define it as a sports bar not only for spectators, but also for participants, including little league or junior soccer teams as well as recreational adult teams. “This really becomes your gathering place or your clubhouse,” he said.

“We often talk about the daytime Turtle and the nighttime Turtle,” Melnick added. “We wanted to have two different spots that capture those specific audiences."

“Team” is intended to convey the chain’s daytime vibe as a place for lunch, dessert or a snack, and “Compete” is going after the nighttime bar scene crowd.

Janush said the brand repositioning also involved the launching of a new menu this month, adding that the commercials were meant to show activity in the kitchen as well as the bar and to show more than guys in a bar watching a game.

About 75 percent of the items have been reworked or are new, he added. “We really redid our entrées especially," Janush said. "They hadn’t been big sellers for us.”

New items include grilled fish tacos; a Caprese salad of fresh mozzarella, basil and roasted tomatoes; and Eastern Shore Mac & Cheese topped with crab and bacon.

The chain also permanently added two of four stuffed burgers that it introduced earlier as limited-time offers connected with a contest. For the contest, customers voted on which burgers would become permanent menu items, and the Bacon and Cheddar Stuffed Burger and the Spicy Jack Stuffed Burger won.

Janush said the physical menu also has been reformatted, from a book to a trifold, so customers can see the entrées before settling on just having appetizers.

Contact Bret Thorn at bret.thorn@penton.com.
Follow him on Twitter: @foodwriterdiary

Focus Brands International Inc. reportedly brought the first U.S. restaurant brands to Libya earlier this month after the debut of its co-branded Cinnabon and Carvel location was delayed several months by the Libyan civil war that ousted former leader Muammar Gaddafi.

Before the start of the Libyan revolution in February 2011, Focus had been working for two years on securing the restaurant’s location in Tripoli and finding the local franchise group. The conflict formally ended last October when Gaddafi was captured and killed.

Brothers Arief and Ahmed Swaidek opened the Cinnabon–Carvel location as franchisees on July 2.

“The tenacity and courage of our franchise partners and their team show their ultimate commitment to the Cinnabon brand,” said Mike Shattuck, president of Focus, which oversees international expansion for Cinnabon, Carvel, Moe’s Southwest Grill, Schlotzsky’s and Auntie Anne’s Pretzels.

The Swaideks plan to open another Cinnabon unit in Libya this year as part of a deal for 10 locations over the next five years. The brothers also will be the franchisees for more Carvel units and Moe’s Southwest Grill locations in Libya.

“The guests love the overall experience at Cinnabon, and they tell us they are enjoying the Western flavors and unique hospitality we strive so hard to offer in beautiful surroundings,” Shattuck said.

Libya is the first foothold for Cinnabon in North Africa, and the brand is seeking franchise partners to develop the brand in Algeria, Tunisia and Morocco. Another Western brand to expand to North Africa was Johnny Rockets, which recently began construction on the first of 10 restaurants planned for Morocco.

Cinnabon has 900 bakeries in 51 countries, and other new markets for the brand in 2012 include Nicaragua, Iraq and Ukraine. The chain reported that it plans to enter another eight markets in the next 12 months. Focus has a large footprint in Russia as well, where it has opened 71 Cinnabons in three years and where the first of 50 Moe’s locations will open this year.

Across the Middle East and Southwest Asia, several Western restaurant brands are finding consumers open to their concepts, including Caribou Coffee, Wing Zone and Texas Roadhouse.

Cinnabon and Focus Brands are both based in Atlanta.

Contact Mark Brandau at mark.brandau@penton.com.
Follow him on Twitter: @Mark_from_NRN

The founders of the Mixt Greens salad chain are scheduled to debut a new upscale sandwich concept next month that will pioneer new mobile ordering and payment methods.

The new Split Bread concept, scheduled to open on Aug. 8 in San Francisco, will be among the first fast-casual brands to decline cash as payment. Guests may pay with credit or debit cards only.

Customers can place orders and pay three different ways:

• They can order in advance online or via smart phone, so the sandwich is ready when they arrive.

• Split Bread will feature tableside QR codes for guests to scan with their smartphones when they sit down. The code will take them to a website to order and pay, regardless of their mobile device operating system, and their meals will be delivered to the table. No app is required.

• Those without smartphones can order and pay at a podium where the menu is posted.

The idea is to make ordering “frictionless and easy,” said David Silverglide, a partner in Split Bread and the six-unit Mixt Greens chain, based in San Francisco. 

Though use of credit and debit cards involve fees for restaurant operators, Silverglide said the efficiencies created make it worthwhile. He said said roughly 70 to 80 percent of customers at Mixt Greens use credit or debit cards, and customers have become used to cash-free payment on airlines.

The company considered putting iPads on all tables, but, Silverglide said, “We wanted to be device agnostic,” leaving guests to their own handheld devices. “A lot of technology being used in restaurants today gets in the way of the experience,” he noted. “This just makes it easy.”

The ordering system also works well with Split Bread’s short but ever-changing menu, which is based almost entirely on seasonal ingredients.

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Developed by chef Andrew Swallow, also a partner in both Split Bread and Mixt Greens, the menu was to design a limited-service “sandwich bistro” that brings food to a high-end level with all-natural rotisserie meats and organic produce, and a focus on in-house preparation, from pickles to popsicles.

“We want to feed the masses really great, healthy food, and feed them real food, not processed crap,” said Swallow, who previously worked in the kitchens of New York’s Gramercy Tavern and San Francisco’s Boulevard and Gary Danko.

Split Bread’s opening summer menu, for example, will feature sandwiches like a porcini-crusted prime rib-eye sprinkled with Maldon sea salt and Sonoma olive oil on a sourdough baguette for $12.95; or spit-roasted leg of lamb with salsa verde, lemon cucumber and treviso on a toasted ciabatta roll for $10.95.

Guests can make substitutions on sandwiches, but there is no build-your-own option.

Salads include the Market, with mixed greens, spit-roasted chicken, bacon, tomatoes, an eight-minute egg, blue cheese, avocado and house vinaigrette for $10.95; or the Valencia with mixed greens, wild arugula, watermelon, heirloom tomato, feta, lemon cucumber, basil and mint with vinaigrette for $8.95.

Sides include fries, cole slaw, kale salad or smashed potato salad, and for dessert, fresh-baked cookies or house-made popsicles. Beer and wine are also available.

In about eight weeks, the menu will change again, based on what is in season, Swallow said. With the menu available mostly online, there are no concerns about changing menu boards or reprinting menus.

A few menu items are designed to stay year round, such as the roasted short rib sandwich with American cheese, shredded lettuce and house sauce on a toasted English muffin.

But guests that ask for tomato on their sandwiches in winter will likely be disappointed. “We’re saying that there are certain seasons when you should be eating these products. It’s when they taste best,” Swallow said.

The average check will be about $12 at dinner, without beverages, which is on the high end for a limited-service restaurant. Swallow, however, contends that consumers are increasingly willing to pay more for “real food.”

At about 2,000 square feet and 46 seats, Split Bread is designed for growth, Swallow said. The partners are scheduled to open a second unit in January in San Francisco’s Financial District.

A third is planned in 2013 in a San Francisco suburb, though they are still looking for a location. The plan is to fill in the San Francisco Bay area before moving to a new market, and they envision Split Bread as a national brand.

Split Bread is part of a small-but-growing “better sandwich” niche that includes 14-unit ‘wichcraft, based in New York; and five-unit Mendocino Farms, based in Los Angeles, that recently won a significant investment from private-equity firm Catterton Partners.

Silverglide and Swallow have created a new management company for Mixt Greens and Split Bread called The Good Food Guys. The partners founded Mixt Greens in 2006, then sold the brand three years later, only to buy it back again earlier this year.

Swallow said they plan to grow Mixt Greens as well next year, and more concepts are coming.

Contact Lisa Jennings at lisa.jennings@penton.com.
Follow her on Twitter: @livetodineout
 

Chuy’s Holdings Inc., the casual-dining Mexican restaurant operator, debuted on the public market Tuesday, bucking a down market to close up 15.9 percent.

The 36-unit Austin, Texas-based company offered 5.8 million shares at $13 each, the top end of its forecasted price offering between $11 and $13 per share. The stock closed Tuesday at $15.06, boding well for upcoming restaurant public stock offerings, including Southlake, Texas-based Del Frisco’s Restaurant Group, which is scheduled to debut on the market Friday.

In comparison to Chuy’s first-day spike Tuesday, the Dow fell 0.8 percent and Nasdaq fell 0.9 percent. Wall Street darlings like Chipotle and McDonald’s were also hit hard by investors as the companies reported depressed sales and earnings news.

Proceeds from Chuy’s offering will be used to pay down debt and add new restaurants, Steve Hislop, chief executive of Chuy’s, said in an interview with Nation’s Restaurant News after the chain debuted on the Nasdaq market.

Restaurants take to Wall Street

With Wall Street headed into the doldrums of August, John A. Gordon, principal of Pacific Management Consulting Group, said companies wanting to go public try to squeeze in public offerings “before the usual summer Street slowdown.”

Gordon cited Bain Capital, in the news now as presumptive GOP presidential candidate Mitt Romney’s former company, as doing its IPOs in late July. “The real market slowdown now couldn't be anticipated 120 days ago,” Gordon said in an email, “so it’s all about the vacation break.”

Market-wide, five IPOs went up last week and eight are scheduled this week, including two restaurant companies — Chuy’s Holdings and Del Frisco’s Restaurant Group.

Del Frisco’s, which operates the Double Eagle Steak House brand as well as the Sullivan’s Steakhouse and the newer Del Frisco’s Grille, said it plans to sell 7 million shares at between $14 and $16 per share. Del Frisco’s plans to offer 4.3 million shares and parent company LSF5 Wagon Holdings LLC, which is owned by Lone Star Funds, will offer 2.7 million shares.

The company, which tried to go public in 2007 but withdrew its application in December 2008, again filed for an IPO of up to $100 million in January this year.

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Other public offerings in the wings are those from Outback Steakhouse parent OSI Restaurants of Tampa, Fla., which said in April that it will change its name to Bloomin’ Brands and seek a $345 million IPO. Cheddar’s Casual Café of Irving, Texas, which used a provision under the Jumpstart Our Business Startups Act to file confidentially for its IPO in May, is also on the blocks. Dallas-based Dave & Buster’s Entertainment Inc. filed for an IPO in 2011, but it has yet to come to market.

CKE Inc., which operates the Carl’s Jr. and Hardee’s burger chains, had filed for an initial public offering of up to $100 million in May and on Monday said it now expects to raise as much as $230 million. CKE was taken private by Apollo Management in a $700 million deal in 2010.

Shares in Ignite Restaurant Group of Houston, which owns the 127-unit Joe’s Crab Shack and the 16-unit Brick House Tavern + Tap, went public in a $83.8 million offering in May. The company’s stock lost more than 20 percent of its value last week when the company announced it would have to restate financial statements for 2009 to 2011, and the first quarter of 2012, because of accounting issues with fixed assets and depreciation expenses.

Chuy’s future as a public company

The casual-dining chain most recently opened a unit in Gainesville, Fla., and is looking to back fill markets in Texas and Oklahoma, as well to colonize new ones such as Atlanta, Birmingham, Ala., and Louisville, Ky.

Hislop said the company, founded in Austin in 1982, expects future units to follow the non-cookie-cutter approach. “We’re going to follow our motto of ‘If you’ve seen one Chuy’s, you’ve seen one Chuy’s,’” Hislop said.

Current units range from 7,000 to 12,000 square feet, and Hilsop said the lower end is likely to be the target for future development.

The chain's menu of burritos, enchiladas and fajitas produces a per person check average of $12.99, Hislop said, “which makes us very affordable.” The concept's emphasis on rock ‘n’ roll music and in-store Elvis altars also positions Chuy's differently than many Tex-Mex operations, Hislop said.

Contact Ron Ruggless at ronald.ruggless@penton.com.
Follow him on Twitter: @RonRuggless