Charitable Giving | January 2010 | By Jamie Hartford

Hunger for Change

With so many problems in the world, why are restaurants homing in on hunger relief?

It usually takes a trade show or the threat of legislation to bring quick-service competitors together, but occasionally the industry puts business aside and rallies around a single cause. In the wake of the devastating effects of Hurricane Katrina, brands flocked to the Gulf Coast to offer assistance. More than four years later, they again seem to have found a common charitable pursuit.

Across the industry, franchisees, independent operators, and major chains are working to help stop hunger in the U.S. and across the globe. According to a 2006 study by the National Restaurant Association (NRA), eight out of 10 restaurants choose to support hunger-relief efforts in one way or another, contributing food, money, time, and marketing clout to further the cause. But why, with so many problems in the world—from AIDS and cancer to global warming and human displacement—have so many in the industry chosen to rally around this specific cause?

Perhaps most importantly, it seems like a natural fit: U.S. restaurants, which serve about 130 million customers each day, helping to feed the 36 million Americans and more than 1 billion people worldwide who don't have access to enough food. The significance is not lost on the NRA, either. The industry's main trade organization has long worked to galvanize its members to end hunger through efforts including its support of National Hunger Awareness Day, donation of leftover food from its annual trade show in Chicago and recognition of individuals who support the cause.

"Hunger relief is a natural connection for restaurants that are in the business of feeding and serving people," says Alyssa Prince, senior director of community relations for the NRA. "It just makes so much sense."

For example, the Great American Dine Out—a fundraising event organized by nonprofit organization Share Our Strength which works to end childhood hunger in the U.S.—experiences great support from quick serves. The weeklong September event, for which restaurants and customers come together to raise money for the cause, drew more than 500 quick-service participants in 2008. This year, participation among brands doubled, says Debbie Shore, co-founder and associate director of Share Our Strength.

While Shore says none of the major quick-service brands have signed on to support the Great American Dine Out, some of the larger companies are organizing efforts of their own.

One of the big names leading the charge to fight hunger is Yum! Brands. The parent company of KFC, Taco Bell, Pizza Hut, Long John Silver’s, and A&W started its World Hunger Relief campaign in 2007 and last year pledged to donate at least $80 million to the World Food Programme (WFP), the world's largest humanitarian agency fighting hunger across the world. Karen Sherman, director of corporate social responsibility for Yum says that though each of the company's five brands has its own philosophy, the company chose hunger as the focus of its corporate giving for a reason.

"We're all in the foodservice business," she says. "We provide food to people, and here we have the opportunity to go much deeper and help those who may never have access to our food and are faced, frankly, with death and starvation."

According to Sherman, Yum chose to partner with the WFP specifically because the organization has the ability to help leverage the company's size and scale to maximize its efforts. The WFP also can reach international communities in which Yum restaurants operate.

In the U.S., 36 million people don't have access to enough food. Worldwide, that number is about 1 billion.

"We're a global company," Sherman says. "We always say that our employee base, our marketing, and our philanthropic efforts need to mirror our company."

But hunger is a problem at home in the U.S., too. When Danny Bone, who owns a franchise location of the upscale burger concept Elevation Burger in Austin, Texas, heard about a hunger-relief program in his community, started by the Junior League of Austin, he decided to help.

Called Food in Tummies, or FIT, the program provides weekend meals for children attending the city's Baty Elementary School, 97 percent of whom are eligible for free or reduced-price weekday lunches through the National School Lunch Program. To ensure they don't go hungry when not in school, FIT sends the kids home with backpacks full of food on Fridays. Bone decided to help by donating 10 percent of his sales for a week this past November, promising to contribute no less than $2,500. He says part of the reason why he chose to donate to a hunger-related cause is that it was a local issue.

"I am a native of Austin," he says. "I've lived here all my life, and I always love to give back to the city. When you give back to Austin, it gives back to you."

Though Bone says it wasn't his primary reason for giving, he acknowledges that his effort to give back could reach the ears of potential customers. "I think there will be those who will notice that we are charitable and perhaps give us a try," he says.

Yet with the quick-serve segment often serving as the press’s whipping boy, one doesn't have to be much of a cynic to question whether these efforts aren't at least in part aimed at improving public relations. After all, many contributions by quick serves to hunger relief are hardly anonymous gifts.

For example, Dunkin' Brands' corporate employees and franchisees wore company T-shirts when they packed boxes for local food banks during a company-organized volunteer day, says public relations manager McCall Gosselin. And Yum’s World Hunger Relief efforts are often accompanied by press releases.

But hunger-relief organizations don’t feel exploited. "The best way the fast-food industry can help us is through cause-related marketing, joining forces with us to raise awareness of the pervasiveness of hunger in America," says Ross Fraser, media relations manager for Feeding America (formerly America's Second Harvest), the largest domestic hunger-relief charity in the U.S.

The publicity can work both ways, too. Share Our Strength, for instance, makes promotional materials available to chains and lists on its Web site restaurants that participate in the Great American Dine Out. Some restaurants also choose to participate in the event by selling coupons that can be redeemed at a later date, creating bounce-back visits.

"In addition to contributing to end child hunger, they can drive traffic, not just PR," Shore says.

Yum identified awareness raising, along with volunteer engagement and fundraising, among the three prongs of its World Hunger Relief campaign. Its initiatives include a Web portal and partnerships with high-profile spokespeople like singer Christina Aguilera and former NBA star Dikembe Mutombo. It's harnessing the power of social networking with campaigns like Pizza Hut's Re-Tweet 4 World Hunger Relief, an effort that invited the chain's Twitter followers to spread the word about the problem of hunger by sharing a link to the Pizza Hut World Hunger donation Web site. For each of the first 25,000 tweets, Pizza Hut donated four meals to the hungry. Yum restaurants also have materials promoting World Hunger Relief at the points of sale.

"Restaurants have the ability to reach so many people through their customers," the NRA’s Prince says. "They have a platform because they have people coming in and out of their restaurants every day. They can use their ability to serve up food and to serve up awareness at the same time."

"Without asking our employees for money, we wanted them to feel a part of our World Hunger Relief effort."

Shore says another reason why hunger may be such a popular cause among restaurants is because it's a problem with an identifiable solution.

"Ending hunger is not a mystery like some of the illnesses and diseases we see in our society," she says. "It's a problem of access."

Yum’s Sherman agrees. "Hunger is an issue that's solvable. There's enough food in the world; it's just not in the right places."

Unlike causes such as finding a cure for cancer, where business benefactors can do little more than raise funds and awareness, hunger relief offers a more direct connection between supporters and their impact. This past September, KFC closed some of its restaurants during the lunch rush so employees could help serve the company's food to residents from local shelters. The event was meant to raise awareness about the problem of hunger, but it also gave employees the chance to see how their efforts can make a difference, says Laurie Schalow, KFC's senior director of marketing and its World Hunger Relief project manager.

"Without asking our employees for money, we wanted them to feel a part of our World Hunger Relief effort," Schalow says. "We felt it was more important to have another way for them to get involved by volunteering. It's one thing to write a check, but to physically get involved with a charity really brings home the importance."

Restaurants also have readily available an important resource needed in the fight against hunger: food. According to LeanPath, a food-waste tracking company, 4–10 percent of the food purchased by commercial foodservice operations ends up wasted.

To help close the gap between waste and want, the NRA announced this fall a partnership with Food Donation Connection (FDC), a company that helps foodservice companies donate surplus food to food banks and soup kitchens across the country. Last year alone, FDC helped 6,700 restaurants donate more than 21 million pounds of prepared—though not yet served—food to more than 3,000 hunger-relief agencies. Quick-service brands, including Yum Brands and Chipotle Mexican Grill, are already using the service.

Restaurants that donate food reap the benefits of tax savings, which can range from $1,000 to $3,000 annually for a single quick serve, depending on the size of the store, amount of surplus food, value and cost of the food, and tax rate, says Jim Larson, FDC's program development director. FDC is a for-profit company, which makes its money by taking 15 percent of the incremental tax savings the restaurants receive.

While many businesses support hunger relief by soliciting donations from customers, the recent tough economic times have made asking for money a delicate issue. Some restaurants have chosen to hold food drives in lieu of or in addition to asking for cash contributions. Mike Manzo, chief operating officer of Jersey Mike's Subs, says some of the sandwich chain's franchisees have chosen to take this approach.

"There are customers out there that love to give a material object versus the dollar," Manzo says.

Although this year Jersey Mike's began its first national initiative to support hunger relief, Manzo says the company has also given to Boys & Girls Clubs, Boy Scouts of America, children's hospitals, and other organizations. When franchisees come into the system, they can partner with a local cause of their choice.

"It doesn't have to be either or," says Share Our Strength's Shore. "It wouldn't make sense, nor would it be practical to say 'do this and not that.' We can work together to figure out a way so that you can still be part of another cause that you care so deeply about and support hunger relief."