Menu Innovations | January 2014 | By Barney Wolf

Breaking with Tradition

Operators continue to add and expand non-pastry morning menu offerings.

Fast food brands are adding new breakfast items like parfaits to their menu.
Sandwiches are the most popular breakfast item at non-bakery quick serves, but chains are increasingly looking to innovative solutions to bulk up their morning daypart offerings. thinkstockphotos.com
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The morning meal has long been a key element of some limited-service restaurants, and it’s no surprise that the number of operators entering this daypart continues to grow, as owners look to boost their revenues and build customer loyalty.

More than a dozen quick-service and fast-casual chains have launched a breakfast menu in the past few years, and many more added new and unique non-bakery items to highlight their roots or differentiate themselves from their competitors. The new rollouts range from extremely small or limited tests, such as Popeyes Louisiana Kitchen’s two-day trial in one restaurant, to Taco Bell’s launch of its First Meal in hundreds of units mostly across the Western U.S. in early 2012.

Operators often leverage ingredients used for their existing menu items to form their breakfast fare’s foundation.

“The most important morning menus for restaurants that don’t have traditional early meals are those that use their signature items to create breakfast food,” says Bethany Wall, foodservice analyst with market research firm Mintel. “You have chicken restaurants capitalizing on their chicken and biscuits, and Mexican restaurants using tortillas and salsa. They are sticking to what they know.”

Sometimes the only new items needed are eggs. Adding only a few new ingredients to create a breakfast menu “makes perfect sense,” says John Howeth, vice president of ingredient and commercial marketing for the American Egg Board. “With restaurant space and storage being critical, you want to add as few ingredients as possible to make the SKUs work harder.”

Launching a morning menu holds plenty of challenges, not the least of which is the money and effort to compete with existing players that dominate at breakfast.

“The data we keep seeing is some players just seem to have a stranglehold on breakfast,” particularly chains like McDonald’s and Dunkin’ Donuts, says Dave Jenkins, managing director of client solutions at Datassential, a Chicago-based market research firm. “Ease, speed, and price is the formula they have had, and it is sure working.”

Still, statistics from Datassential and Mintel reveal the number of limited-service restaurant breakfast items is rising sharply, fueled by an increase in the number of restaurants entering the pre-10 a.m. dining hours rather than from expanding menus. Breakfast sandwiches make up the bulk of non-bakery quick-service and fast-casual morning menu items, Mintel reports. The sandwich is a logical choice because the number of ingredients, preparation methods, and sauces can seem endless. Bacon is the most popular protein, appearing on 30 percent of sandwiches, followed by ham and sausage.

Burritos are the second-biggest non-bakery breakfast menu item, expanding by one-third in recent years, according to Mintel.

“The Hispanic market is growing, but we in America are also more of a melting pot, so it’s no surprise to see these gains,” Wall says.

The growth in burritos at breakfast is also a result of their portability and relatively easy preparation. That fits well with the decision by Taco Bell to launch its breakfast menu two years ago. The menu will roll out nationally this year, company officials have said.

Burritos make up the bulk of the Irvine, California, company’s morning menu, which includes three egg-based burritos ($1.49–$2.29), two egg-and-meat AM Grillers (grilled burritos; $1), and two egg-and-meat AM Crunchwraps ($2.49) with tortillas and crunchy tostadas. Taco Bell’s customers seek items with great taste and value, says Liz Matthews, the company’s chief food innovation officer, in an e-mail. “Most importantly, they want a breakfast menu with familiar breakfast tastes, but with a unique Taco Bell twist,” she says.

Taco Bell is testing new breakfast menu items in three markets. One intriguing item is the Waffle Taco ($1.79), filled with scrambled eggs and sausage and served with a side of syrup. Matthews calls the Waffle Taco a “destination item.”

Other operators are also trying new Hispanic-flavored offerings. Taco John’s launched breakfast burritos and tacos featuring Southwestern chile verde, and McDonald’s tested a jalapeño salsa breakfast sandwich in Houston. Even fast-casual giant Chipotle has a limited breakfast menu, with chorizo and vegetarian frittatas at several Washington, D.C., airport locations.

Another new offering Taco Bell is testing is fruit-topped oatmeal ($1.99), giving the company an entry into one of the fastest growing restaurant morning categories. Mintel reports that oatmeal menu mentions have increased 75 percent since 2010, when McDonald’s began serving the hot cereal.

Despite their ubiquity, breakfast sandwiches are finding more room on quick-serve menus, too. This includes several additions to existing lines at Dunkin’ Donuts. The Turkey Sausage sandwich has a fried egg, turkey sausage, and reduced-fat Cheddar cheese on a toasted English muffin, while the Angus Steak Big N’ Toasted is made with two eggs, steak, and American cheese on Texas toast.

“We’re committed to seeking innovative ways to expand the choices on our menu and delivering a great value to our busy, on-the-go guests,” says Stan Frankenthaler, executive chef and vice president of product innovation, in an e-mail. The chain’s breakfast sandwich lineup was launched just a couple of years ago and “represents a truly new offering,” the chef says.

Dunkin’ Donuts has even taken a page from its own history to create a breakfast sandwich with a fried egg and bacon slices sandwiched between halves of a glazed doughnut.

Auntie Anne’s is another veteran quick serve to add breakfast by using its most traditional ingredient: pretzels. The morning meal is available in 50 units at airports, train stations, and travel plazas. The brand looked at different uses for its pretzels and focused on breakfast sandwiches.

“We saw the trend to artisan bread and thought we could do something with our dough,” says Carl Hornberger, director of menu management for the company. “The trick was finding the right size and shape.”

Auntie Anne’s developed a pretzel sandwich roll in two varieties—the Sausage, Egg, and Cheese and Bacon, Egg, and Cheese, both offered for less than $4—plus five sausage links hand rolled in pretzel dough and served in a cup. The breakfast menu launched in 13 of Auntie Anne’s 1,400 locations in 2012, “and we saw it quickly take off,” Hornberger says.

Around-the-clock hours at nontraditional locations has led a number of other operators to consider a breakfast menu for those locations. One is Five Guys Burgers and Fries. “We have breakfast in a few locations,” says Molly Catalano, spokeswoman for the Lorton, Virginia–based burger chain. “It started in airports, because they require you to serve breakfast. And we wanted to be in there.”

The company has since added breakfast at a few other units that have good foot traffic. The only ingredient Five Guys added for breakfast was eggs. An egg sandwich; an egg and cheese sandwhich; and a bacon, egg, and cheese sandwich are all available with any of the chain’s normal toppings and sauces. A burger patty can also be added.

Having a restaurant in a transportation location with morning commuters was a major reason Boston-based grilled cheese chain Cheeseboy started adding breakfast at some of its units, says founder and president Michael Inwald. “We knew there was a breakfast crowd in the South Station Train Terminal” in Boston, which was the 11-unit chain’s second store, he says. “Guests would come in at 9 a.m. for a grilled cheese sandwich with bacon, so we knew there was demand.”

Today, five Cheeseboy restaurants have breakfast sandwiches, listed at $3.49. The Farmhouse Melt includes eggs, tomatoes, baby spinach, and white American cheese on Italian bread. There are also breakfast items made with bacon or sausage. “We are a build-your-own concept, so you can mix and match,” Inwald says.

Sausage and bacon are traditional breakfast proteins, but chicken is also popular, particularly in the South. Among the chicken-based chains now conducting breakfast market tests are two Southern-based companies, Chick-fil-A and Zaxby’s.

Pizza can also become a breakfast item. Happy Joe’s Pizza & Ice Cream, a 60-unit company based in Bettendorf, Iowa, has offered a breakfast pizza at some locations for years, and it launched a chain-wide breakfast program in the fall of 2011 with omelet pizzas and cinnamon rolls. Locations can also serve breakfast burritos and oven-baked scramblers.

“We actually created our breakfast pizza over 20 years ago,” says Kristel Whitty-Ersan, marketing manager and daughter of founder Joe Whitty. “It was a pizza my dad created for times we had morning meetings with his business groups at our [original] restaurant.” The omelet pizzas include the Denver, with green peppers, onions, tomatoes, and diced bacon; the 3-Meat, with sausage, bacon, and Canadian bacon; and the Bacon & Bacon, with bacon and Canadian bacon. A build-your-own version is also avaliable. “The great thing is we already have all the ingredients, all the toppings prepped,” Whitty-Ersan says.

While restaurants usually serve breakfast only during morning hours, an increasing number of operators are offering the early menu during other dayparts and, in some cases—like Sonic and Jack in the Box—whenever the restaurants are open.

“We know that our guests don’t always have time to sit down and have a complete meal and that they may be eating at unconventional hours in a clockless day,” Dunkin’ Donuts’ Frankenthaler says.

McDonald’s offers its Fruit and Maple Oatmeal, Cinnamon Melts, and Fruit ‘n Yogurt parfaits all day and is expanding some of its breakfast menu hours to late night as part of the McDonald’s After Midnight Menu that also includes dinner menu items.