Industry News

Seeing as how it has been a while that we have passed along some good reads, we thought we’d take this week to do so.  As we wrap up the 3rd quarter of 2013 and stare the holiday season down, these articles, courtesy of QSR Magazine, take a look at some interesting ideas and concepts that are gathering steam out in the market.  We also revisit the “10 trends of 2013” to see how they currently match up to the beginning of the year.  Enjoy!

The Perfect Restaurant Model

Restaurant models are generally imperfect. Ninety-nine percent of the time there are clear negatives to every model.

As an example, let’s talk about the traditional model for a coffee business. The percentage margins are high and the staffing costs are low—two great indicators for success—but in order to make any meaningful profit, you need to drive high volume and own multiple outlets. This is due to the fact that, despite percentage margins being high, the cash margin is low. If you make 20 percent profit on a $2 cup of coffee (after cost of labor, rent, custom cups, marketing, and other operational expenses), you are making 40 cents per cup. You’ll need to sell a ton of coffee for those 40 cents to add up to a meaningful profit annually.

This is the major challenge for almost all quick-service businesses: They are capitally intensive because they need to open a lot of outlets and have to eke out small margins over a large volume of business. Additionally, when looking at a model like coffee, the post–6 p.m. meal period is rarely profitable because most people prefer to spend their nights sleeping rather than rolling around in bed with their mind racing on caffeine. Despite these challenges, the coffee business is clearly one of the top business models in the world today.

But I think I have found one even better—maybe even perfect.

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Ones to Watch: Salata

In 2003, Berge Simonian noticed something interesting happening in the restaurant he had operated for almost a decade in downtown Houston. The line for salads was frequently longer than the line for hot foods.

With that in mind, Simonian and his business partner, Tony Kyoumjian, began working on the idea of a quick-serve salad concept. Believing that a salad is only as good as the dressing you put on it, the partners focused intently on recipes for salad dressings, sauces, and soups, and the first Salata location opened its doors in late 2005. “Our goal is to be a good, clean, healthy choice restaurant,” Simonian says. “Ingredient freshness, quality, variety, and taste are key.”

Dining at a Salata is simple. Guests start by choosing a fresh salad, priced at $8, or a salad wrap for $7. They walk down the line picking and choosing from a variety of salad ingredients, and the salad is constructed, tossed, and handed to the customer at the end of the line. All prices on the Salata menu include tax, so there are no surprises when the customer goes to pay.

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Your Way or the Highway

With customization looming large, how can quick serves play catch-up?

I made my own pizza for lunch the other day, and I have to say it was pretty great. Now, in the interest of full disclosure, I admit I’m taking a little license with the language by saying I “made” this pizza. I didn’t roll out or toss the dough, though I did choose my crust from a few available varieties, as was my prerogative. I also didn’t slave over a saucepan to get the tomato sauce a little smoky, a little spicy, and distinctly tangy, the way I like it.

In terms of cheese, I had several options, ranging from smoked Mozzarella to goat cheese, Brie, and truffle Pecorino, but I didn’t have to grate or smear the stuff over the crust before tossing the whole works in the oven—which, come to think of it, I really didn’t do, either. Also, while I treated myself to a wealth of toppings, including fresh oregano and basil, some crushed red peppers, oven-roasted red onions, and bell peppers, I didn’t visit the farmers’ market or the grocery store produce section beforehand (or at all, really).

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Finally, let’s see if the trends set before us in January of this year are still holding true…

10 Trends for 2013

The menu items, promotional tools, and business strategies that will affect quick serves this year.

What would the start of another year be without predictions? Whether analyzing politics, the silver screen, or stock markets, experts try to offer a peek at the trends we can expect in the coming year.

The restaurant industry is no different. Throughout 2012’s fourth quarter, various consultants, chefs, and operators gazed into their crystal balls and forecasted the hot restaurant ideas and issues of 2013.

The following 10 trends, according to those experts, seem most likely to impact quick-service and fast casual restaurants this year.

1- Going local

Despite disagreement about what local really means, there is little doubt that consumers increasingly see it as a positive attribute. Locally grown or sourced ingredients fill three of the 10 spots in the National Restaurant Association’s (NRA) annual “What’s Hot” culinary forecast, a survey of more than 1,800 professional chefs who are members of the American Culinary Federation.

Local sourcing is a “macro-trend that will maintain its momentum” this year, says Joy Dubost, a registered dietician and director of nutrition and healthy living for the NRA.

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As you can tell, there is a lot to consider as you sift your way through the world of quick service and fast casual.  Should you need some guidance along the way, we should be able to point you in the right direction.  Give us a call today at 888-235-2579