Competition | December 2010 | By Staff

2010 in Review

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24. Deckers, Blaze Modern BBQ, and Laughing Noodle

Locations: Lebanon, Tennessee; Lafayette, Indiana; and Springfield, Ohio

Opened: July, August, and September

“They’re distinctive tastes that our customers have told us they’re interested in,” says Jamie Richardson, vice president of White Castle, which developed the brands. Deckers offers triple-decker sandwiches made with anything from Italian cold-cuts to peanut butter and jelly; Blaze is what Richardson calls slow-cooked barbecue served fast; and Laughing Noodle’s menu includes a variety of pasta-based dishes.

The Twist: All three concepts offer White Castle customers more upscale options in addition to their much-loved sliders. Each is being tested in separate (pre-existing) White Castle stores that were renovated and are now operating as cobranded locations. —RVT

25. Food Costs on the Rise

Agricultural prices in the commodity markets were volatile, although prices rose overall. Cattle futures in mid-September rose to the highest level in nearly two years before falling back, while hog prices were more than 10 percent higher through the third quarter.

Prices were up for chicken and turkey, too, while grain prices were also rising.

All that could put pressure on restaurant operators’ margins.

“The restaurants that locked in prices through contracts are reporting better year-over-year food costs, while those that didn’t have seen their gross margins take a beating,” says Steve West, a restaurant industry analyst for St. Louis–based investment firm Stifel, Nicolaus & Co. —BW

26. Drive Thru Catches on in Fast Casual

In February, Panera Bread opened a drive-thru unit in the Glendale, California, Hilton Garden Inn, one of just a handful in the system.

Drive-thru services were also unveiled at other unsuspecting outlets, including Robeks Fruit Smoothies & Healthy Eats, and discussed at others, such as the reinvention-charged Jamba Juice. As quick-service brands seek new, convenient ways to serve customers, drive thrus are expected to play a more substantial role in 2011. —DS

27. Coca-Cola Freestyle Crew Version

Coca-Cola rolled out a crew version of its Freestyle beverage-dispensing machine this year and is testing it in multiple markets.

Quick-serve crews now have at their fingertips 106 beverage brands and 81 nonillion (that’s 81 with 30 zeros) possible beverage combinations. —SO

28. Skinner Defends Ronald McDonald

“The answer is no. He is a force for good. He communicates effectively with children and families around balanced, active lifestyles. He does not hawk food.” — McDonald’s CEO Jim Skinner in response to critics’ calls for the retirement of Ronald McDonald —DS

29. Secret Sodium Reductions

A salty menu item is a tasty menu item. Or at least that’s what most consumers seem to believe. Which is why, although many brands such as Boston Market and Pei Wei have jumped on the sodium-reduction bandwagon recently, they’ve been keeping it on the down-low.

“For most health trends, companies are very good about telling everyone what they’re doing so they get credit for providing healthier options,” says Mintel’s Dornblaser. “But what we’ve seen with sodium is exactly the opposite.”

Concepts have typically been sending out a press release about the changes, but do little else to publicize it.

“The idea is to reduce sodium a little now, wait for customers to get used to it, then reduce it a little more, and continue that process,” Dornblaser says. “That way it’s not a jarring change like it would be if you decreased sodium by 30 percent all at once.”

The strategy helps restaurants address concerns voiced by consumer advocacy groups like the Center for Science in the Public Interest without alienating customers who are more concerned with flavor.

“It puts them in a good position,” Dornblaser says. “Sodium reduction will continue to be a big issue going forward, so concepts who are looking into low-sodium options now will be poised to say, ‘Here’s what we’ve already started to do.’” —RVT

30. Light at the End of the Tunnel

Cautious optimism is definitely the watch word for 2010. Obviously, there will be no rebound to prosperity in 2010 … but the entrepreneurship, optimism, and flexibility of restaurant operators will show that, no doubt, there can be success achieved by many members of the [restaurant] community.” —DS
— Hudson Riehle, NRA senior vice president of research and knowledge

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