And, Chick-fil-A is leapfrogging rivals.
============
Last week, we posted that Costco – which sells almost 1 million chickens each day – is opening its own mega chicken farm to partially satisfy its needs.
A beneficiary of the trend – or, make that “the driving force” behind it – is Chick-fil-A .
I thought the long lines were a local phenomenon, but data indicates that it’s a national occurrence.
According to CNBC …
Costco is shelling out $440 million to open a Nebraska chicken farm.
Why is Costco doing it?
“To partially escape the American chicken monopoly run by the likes of Tyson, Pilgrim’s Pride and Perdue.”
Technical note to CNBC: A monopoly has only one supplier. A duopoly has two. When there are three, it’s a concentrated competitive market.
The self-operated farm provide Costco with 100 million chickens … 40 percent of its yearly chicken needs.
Doing the arithmetic, that means that Costco goes through about 250 million chickens every year.
That’s a lot of chickens but pales in comparison to KFC which reportedly goes through 3 or 4 times as many.
Personal note: Many, many years ago, I interviewed for a position at KFC as a chicken buyer. I was recruited because I had an economics degree and had worked for a large grocery store chain.
It wasn’t a good fit. (<= understatement)
=============
Follow on Twitter @KenHoma
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Sounds like a “dog ate homework” excuse, but you may eat too many cookies – not because you’re a fundamentally bad person – but, because you’re addicted to them andmay want to enroll in Cookies Anonymous.
In some ground-breaking research to be present at a Society for Neuroscience conference next month, a Connecticut College study concluded that Oreos are just as addictive as drugs.
=======
Here’s the skinny on the research findings …
3-star chef wants out of the rankings
==========
According to the NY Times …
Sébastien Bras, one of France’s most celebrated chefs, has stunned the French culinary world with an unlikely plea: Take my three Michelin stars away.
Mr. Bras is fed up with the pressure of maintaining those stars. He says he is seeking nothing less than culinary “liberation” and “a new meaning to my life.”
While the stars confer cachet and financial security, Mr. Bras’s audacious move is also reflective of a new generation of chefs, some of whom are eager to escape from the punishing strain of unpredictable rankings and malicious food critics.
“Three stars mean that everything must be perfect, at any time, in every plate. One must be passionate, a genius, but mostly a workaholic, because you have to be working in your restaurant from 7 a.m. to 2 a.m. every day, nonstop.”
There’s also an economic angle …
To put it mildly, the dogs stopped eating the dog food.
=========
As reported in the WSJ …
In early 2015 General Mills reformulated iconic Trix cereal to make it all-natural – replacing Red Dye #40, Blue Dye #1 and Yellow Dye #6 with radishes, purple carrots and turmeric.
Besides producing a bland color, the juices and extracts gave the cereal a different taste.
Natural-ingredient haters flooded the company with calls, emails and social-media posts:
“I genuinely feel bad that my kids will never got to experience the old Trix cereal.”
“My kids think the color of the new Trix cereal quite depressing.”
“It’s basically a salad now.”
“My childhood fading away with the colors of Trix cereal.”
“Americans’ love affair with processed foods is enduring, however, despite a decade of finger-wagging from nutritionists, influential celebrities and trendy grocery chains.”
So, General Mills has decided to reintroduce Classic Trix, artificial flavorings and all, and will start selling it on supermarket shelves alongside the more wholesome version in October.
Here’s what other brands are doing …
Believe it or not, this topic came up in a chat with students … so, I decided to reprise it.
======
Business Week ran an article titled “Keeping the Mystery Out of China’s Meat”
Can’t explain why I decided to read it.
But, I did … and here’s what caught my eye.
A couple of weeks ago we posted a Business Week report titled “Keeping the Mystery Out of China’s Meat”
The essence of the article was that some Chinese retailers were selling donkey meat that was diluted with fox meat. If you don’t understand why that’s a show-stopper, see Tainted donkey meat … say, what?
Fearing that I might inadvertently get stuck with some bad donkey meat, I’ve been alert to mystery meat stories.
Right on cue, here comes Taco Bell.
C’mon, admit it … when you bite into a TB taco don’t you wonder if you’re really eating beef?
Let’s make this pizza week …
Chuck E. Cheese has been struggling of late.
Same store sales have been declining over the past couple of years.
=====
What’s ailing the Chuckster … and what will get him healthy again?
Yesterday we posted about a study concluding that Oreos are addicting.
Not to be out-done , a study by University of Michigan researchers — published in the U.S. National Library of Medicine — concludes that pizza is at the top of the most addictive food list.
=====
So, scientifically speaking, what is it that makes pizza so addictive?
Sounds like a “dog ate homework” excuse, but you may eat too many cookies – not because you’re a fundamentally bad person – but, because you’re addicted to them andmay want to enroll in Cookies Anonymous.
In some ground-breaking research to be present at a Society for Neuroscience conference next month, a Connecticut College study concluded that Oreos are just as addictive as drugs.
=======
Here’s the skinny on the research findings …
Answer: Definitely not a Kentucky Fried Chicken.
When I heard a news blurb talking about KFC genetically raising chickens with 8 legs and 6 wings, I bought in.
I figured: smart move.
Kids devour drumsticks and wings are still one of the hottest bar foods around.
My thought: good operations move … improve the “yield” from each chicken.
Turns out that my read wasn’t the story at all …
You probably heard that Kraft is recalling it’s Mac & Cheese.
When I heard the headline, I assumed that it was because somebody finally figured out what the orange stuff was.
Not so, apparently some metal shavings got mixed with the goop … not exactly the way to add iron to the foodstuff.
The recall gave me a flashback to a post from last year … very much on topic … so I dug it up for a replay.
At the time, consumer groups were a bit concerned about the Mac & Cheese ingredients.
Uh-oh: Consumer mavens dissing Kraft’s dayglow mac & cheese …
Talk about a timely news item.
In class Tuesday, we were talking about food taste & quality.
My teaching point: when the food buyer isn’t the food eater, the buyer may be less sensitive to taste & quality.
My example: millions of mothers serve their little kiddies mac & cheese that glows in the dark.
A veiled reference to Kraft’s legendary mac & cheese … and, that odd color of orange that happens when those mysterious dry ingredients are stirred into the pasta.
Well, apparently the neon dish also caught the eye of a couple food crusaders who have embarked on a campaign against two of the dyes that Kraft uses to create its trademark color.
Here’s their rip and Kraft’s response …
Fast food workers around the country have been protesting for a $15 minimum wage.
A couple of days ago we warned about the possibility of McDonald’s replacing $1 menu with a buck-and –a-half menu … ouch!. The core story line: economists modeled the impact of raising the minimum wage for fast food workers to $15 and concluded that, all else equal, fast food prices would have to go up by about 40% to cover the increased labor costs.
Ooch. Continues a historic trend … As time rolls on, a buck buys you less and less at Mickey D’s
Since that post, a couple things happened.
First, McDonalds reported a 3.7% decline in global same-store sales.
That ranks as the company’s worst global same-store sales results in more than a decade.
Profit margins are shrinking and the company is trying to upmix customers to higher margin menu items.
Not exactly the time to be asking for a 66% raise, right?
=====
Adding to the discourse, a couple of loyal readers fed me some red meat: the realistic possibility that, very soon, low skilled burger flippers will be eased out by burger-making robots.
Here’s the scoop …
Relax, we’re just speculating … it’ll only happen if the fast-food workers get the $15 per hour that they were clamoring for last week
Economists at the Heritage Foundation have observed that fast-food joints operate on very slim profit margins (about 3% on average) so they’d have no choice but to bump up prices. to stay even.
The Heritage economists estimate that a $15 minimum wage for hamburger flippers would force restaurants to raise average menu prices about 40% in order to hold the current level of profitability.
Here’s the essence of their analysis …
A couple of weeks ago we posted a Business Week report titled “Keeping the Mystery Out of China’s Meat”
The essence of the article was that some Chinese retailers were selling donkey meat that was diluted with fox meat. If you don’t understand why that’s a show-stopper, see Tainted donkey meat … say, what?
Fearing that I might inadvertently get stuck with some bad donkey meat, I’ve been alert to mystery meat stories.
Right on cue, here comes Taco Bell.
C’mon, admit it … when you bite into a TB taco don’t you wonder if you’re really eating beef?
Recent issue of Business Week ran an article titled “Keeping the Mystery Out of China’s Meat”
Can’t explain why I decided to read it.
But, I did … and here’s what caught my eye.
I think that practically everybody agrees that weight is a function of calorie intake …. offset by exercise and “normal” metabolic burn-off.
But, at our house at least, there has been an ongoing debate about whether calories consumed early in the day are more likely to be burned off than calories consumed later in the day.
You know, the “eat a big breakfast” thing … complemented with “late night calories turn to fat when you sleep”.
I skip breakfast most days, so I notice more articles saying “total calories are all that matter”
Technical note: It’s a known cognitive bias that people are selectively attentive to information that supports their existing points-of-view
Somehow, my eye caught an article with evidence to the contrary …
It’s been a while since we’ve posted on Twinkies near-death experience.
You probably remember that Hostess Brands – Twinkies parents – filed for bankruptcy after one of its unions balked at a new contract … concluding that no wages were better than low wages.
The company’s brands and assets were bought by Metropoulos & Co and Apollo Management Group.
The new owners are consolidating operations, ditching the high wage unions and … deep-freezing Twinkies.
We’re not talking baked goods quality, we’re talking quality of the earnings baked into stock market valuations.
And, the answer may surprise you.
Having spent 3 tours of duty in Chicago, I’m a deep dish pizza aficionado … and loyal to Uno’s — the best!
Well, last trip in, the server directed our attention to a new twist on the menu:
Nearly 70 years after inventing deep dish pizza, last year Uno’s introduced a new deep dish crust in honor of National Pizza Month.
Uno’s invented deep dish pizza in 1943 and this is another industry first: the nine-grain deep dish crust – which likely cannot be found anywhere else in the world..
Being a curious kinda guy, I asked the server to name the 9-grains.
She named 2 and took off to get the manager.
He named 2 more, but we were still 5 short.
We were talking about the incident at a fam get together this weekend.
The real-time iPhone-Google searches came up short.
But, a friend (and loyal Homa Files reader) dogged for the facts.
Best she could find: Some dude named Bob throws 10 grains in his whole grain hot cereal.
Now, all we have to figure out is which grain didn’t make Uno’s cut.
Anybody know?
Thanks to MET for feeding the lead.
* * * * *
Follow on Twitter @KenHoma >> Latest Posts
Once again, coincidence strikes.
This week in class we’re doing a a case about a company trying to launch an innovative refrigerated pizza.
Guess this is innovative pizza week.
Leading the charge: Little Caesars
According to the Huffington Post, Little Caesars — “more known for value than taste” — is launching a big new “higher end” product called the DEEP! DEEP! Dish pizza.
The new pizza is “Detroit-style” — a thick, square-panned pie that’s crispy on the edges, but has a soft, chewy middle.
No kidding, the company is calling it “the biggest product introduction in the company’s 54-year history.”
Hmmm.
I can remember sucking down Uno’s deep dish in Chicago 40 years ago … and, I was a late-adopter.
I guess that some innovations diffuse through the market at a slower rate than others …
P.S. “Detroit-style pizza” … you gotta be kidding me.
* * * * *
Follow on Twitter @KenHoma >> Latest Posts
Talk about a timely news item.
In class Tuesday, we were talking about food taste & quality.
My teaching point: when the food buyer isn’t the food eater, the buyer may be less sensitive to taste & quality.
My example: millions of mothers serve their little kiddies mac & cheese that glows in the dark.
A veiled reference to Kraft’s legendary mac & cheese … and, that odd color of orange that happens when those mysterious dry ingredients are stirred into the pasta.
Well, apparently the neon dish also caught the eye of a couple food crusaders who have embarked on a campaign against two of the dyes that Kraft uses to create its trademark color.
Here’s their rip and Kraft’s response …
Forget Nenghazi … here’s a scandal for you.
According to the UK Telegraph …
An Australian teenager measured his Subway “foot-long” sub and find it was an inch short.
The picture-is-worth-a-thousand words is buzzing the internet.
Subway’s corporate responses (two of them) are classics …
You guessed it, Kentucky Fried Chicken.
Yum has been one of the most successful foreign companies in China.
Yum has more than 4,000 KFC outlets and more than 700 Pizza Huts.
Yum gets about 50% of its revenue from China.
Nice to see the Chinese adopting a wholesome American diet …
* * * * *
Follow on Twitter @KenHoma >> Latest Posts
For the first time in awhile, McDonald’s reported a drop in same store sales … and fired the U.S. President.
Now, industry mavens are proffering advice for turning things around …
Reported in USA Today, here are some of the ideas:
= = = = =
Ken’s Take:
1) Geez, don’t panic guys … there is a tough economy out there
2) Stay true to your core … remember when Taco Bell tried to go upscale and started to lose its base – young males looking for cheap food.
3) It’s all about the dollar menu – the McDouble for $1 is a powerful magnet !
* * * * *
Before the reveal, a question …
Hostess was brought down by bakers in the the Bakery, Confectionery, Tobacco Workers and Grain Millers Union.
Where will Twinkie bakers find work when hostess closes?
Will restaurants rush to pick-up Twinkie bakers as as pastry chefs?
I’ll take the under on that bet.
= = = = =
Bake ’em at home
When Hostess Brands announced that it was shutting down, loyalists lamented the loss of their beloved Twinkies.
Not to worry.
Below is a recipe for homemade Twinkies … the cake and the filling.
The secret sauce?
Crisco … lots of Crisco.
Bon Appetit!
Golden “Twinkie” Cake:
2 cup all-purpose flour
3 tsp. baking powder
¼ tsp. salt
½ cup unsalted butter, softened
1 cup sugar
2 large eggs
1 tsp. vanilla extract
1 cup whole milk
Preheat your oven to 350 degrees F. Spray molds/pan with non-stick spray.
Sift together flour, baking powder and salt into a bowl and set aside.
In a large bowl, beat together butter and sugar at medium-high speed until pale and fluffy. Next, beat in the eggs one at a time, beating for 1 minute in between each addition. Reduce the mixer speed and add flour mixture alternating with the milk, beginning and ending with the flour mixture. Add the vanilla and mix until the batter just comes together. Over mixing with make your cake chewy. Makes 12 cakes.
Spray your Twinkie canoes and bake at 350 for 15 minutes, or until the cakes are just a light golden color and a tester inserted in the center of the cakes comes out clean. Remove from the oven and let cool.
= = = = =
Cream Filling
¼ cup shortening (Crisco brand)
¼ cup margarine
1 cup sifted powdered or 10x sugar
2 tsp. vanilla
Beat together the shortening and margarine until light and fluffy. Add the powdered sugar in a little at a time and beat on high until peaks form. Add vanilla and beat for one minute. Place in prepared icing tubes for piping into cakes.
To fill the cakes, insert the icing tip – preferably a large star tip – into three points along the flat-side of the cake, about 1/8 of an inch deep. Squeeze lightly until you see the filling begin to ooze out.
* * * * *
Hot off the WSJ wires …
Hostess Brands, the maker of iconic treats such as Twinkies and traditional pantry staple Wonder Bread, is shuttering its plants and liquidating its 82-year-old business.
A victim of changing consumer tastes, high commodity costs and, most importantly, strained labor relations, Hostess ultimately was brought to its knees by a national strike orchestrated by its second-largest union … the Bakery, Confectionery, Tobacco Workers and Grain Millers Union.
The company will “promptly” lay off most of its 18,500 employees and focus on “selling its assets to the highest bidders.”
Hostess’s remaining inventory — loaves of bread and plastic packages of cream-filled desserts — probably will be sold in bulk to a discounter or big-box store.
The company will attempt to sell its plants and its brands – think Twinkies, Ding-Dongs.
The names have decades of “deliciously retro” brand equity, and there is “pretty significant demand” for the products.
A fresh owner of the intellectual property, which includes everything from names to recipes to graphics, could revitalize the Hostess brands with new flavors, limited-edition Twinkies, co-branded products, and international reach.
* * * * *
McDonald’s is reporting that global sales at restaurants open at least a year fell 1.8 percent for the month.
The last time the figure dropped was in 2003.
The figure is a key metric because it strips out the impact of newly opened and closed locations.
The fast-food chain says the figure fell 2.2 percent in both the U.S. and Europe.
In Asia, the Middle East and Africa, sales dropped 2.4 percent.
McDonald’s sales slowed recently as the company faces intensifying competition and a weak economy
Source
– – – – –
Note that the company didn’t blame the U.S. drop on Michelle Obama’s war on fast food … and didn’t blame the drop in Mis East sales on a video
Punch line: A hot dining out trend … the intersection of the foodie culture and social media … call ’em food paparazzi.
* * * * *
Excerpted from brandchannel.com’s “To Cell or Not – While Dining Out”
Interested in wooing business in a challenging economy, and accommodating a younger, wired clientele, many restaurants now cater to diners who have morphed into “food paparazzi.”
photo courtesy of JNH
Flickr, the photo-sharing website, has seen the number of pictures tagged as “food” jump from about half a million in 2008 to more than 6 million today… In the group “I Ate This” on Flickr’s site, nearly 20,000 people have uploaded more than 307,000 images of their latest meals.
Of course, this doesn’t begin to count the myriad pictures of food posted to Facebook, Instagram, Twitter, Tumblr, Foursquare, Yelp and foodie niche social networks like Foodspotting.
Camera manufacturers are joining the trend. Nikon, Olympus and Sony sell cameras that offer “cuisine” or “food” settings, which adjust to enhance colors and textures on close-ups.
Sounds harmless enough, but the craze has detractors.
Some maitre d’s regularly face diners demanding to be moved away from camera flashes and the sound of firing shutters.
Some waiters are put off when voice recorders are used to capture their recitation of each course.
Some chefs have had enough.
Perry’s Deli in Chicago, has gone so far as posting a sign for consumers of their signature overstuffed sandwiches:
“Attention! The use of cellular phones at Perry’s is strictly prohibited. If you are that important that you must use your phone, you should be eating in a much more upscale restaurant.”
Edit by BJP
Punch line: An LA restaurant is offering diners a 5% discount to check their technology at the door and actually talk to each other while dining instead.
* * * * *
Excerpted from brandchannel.com’s “To Cell or Not – While Dining Out”
The escalating battle over digital displays in public has reached new heights…or lows…depending on your position on personal freedom versus a modicum of civility.
Between texting, tweeting and Instagram-ing restaurant meal photos, “distracted dining” is the latest scourge on the most basic of manners, the art of face-to-face conversation.
Eva Restaurant … in Los Angeles is offering diners a five percent discount on their bill to check their tech at the door.
“For us, it’s really not about people disrupting other guests. Eva is home, and we want to create that environment of home, and we want people to connect again,” said owner/chef Gold.
About half the customers … take the discount. “I think … they like the idea of actually talking to each other again,” adds Gold.
Edit by BJP
At the Georgetown student center’s food court, it’s now $5.25.
Ouch.
I don’t know if it’s the end of a promotional era or just DC area inflation, but I was sticker shocked when I saw the sign saying the price on my cold cut trio had been jacked up by a quarter.
Trade reports say Subway’s trademarked $5 footlong pricing was a resounding “value pricing” success … driving volume … but, apparently, not enough profits.
Somehow, a $5.25 footlong doesn’t have the same promotional ring, does it?
Oh well.
Watch your back Georgetown Cupcakes …
According to Crain’s Business, In NYC, doughnuts are the new cupcakes.
Homa Family Favorite
We’re talking gourmet doughnuts.
More sophisticated concoctions than the garden-variety glazed or cruller.
They come in a variety of shapes and exotic flavors, such as pistachio-encrusted with lemon curd or square peanut butter filled with banana cream.
And, oh yeah, they sell for up to $3.25 each.
Ouch.
Donut shops aren’t the only ones taking advantage of the surge in popularity.
As a to-go item, doughnuts are also helpful in generating walk-in breakfast traffic for restaurants.
The cost of making a doughnut is relatively low compared with other sweets — and profits are high.
The core ingredients — mostly flour, water, sugar and salt — are relatively cheap, and production doesn’t require a lot of heavy-duty equipment or skilled labor, leading to profits of 15% to 30% per doughnut.
* * * * *
Hmmm … 2 gourmet donuts or a dozen from Dunkin’?
A no brainer …
Thanks to MES for feeding the lead
Now you’re talking ….
According to the LA Times, Let’s Pizza is a pizza vending machine that promises to deliver a piping hot pizza pie made from scratch in less than three minutes.
The machine makes pizzas to order, including kneading and rolling out the dough.
There are more than 200 toppings from which to choose.
The pizza is “delivered” in an insulated take-away box.
The machine takes cash and credit cards.
A 10-inch pizza will sell for about $5.95.
“Let’s Pizza is a huge success in Europe, especially in Italy.
You have to see it to believe it
click to watch the pizza machine work
Excerpted from the NY Times When a Sugar High Isn’t Enough
Dr. John Kellogg — founder of the world’s largest cereal company had a simple credo: “Eat what the monkey eats … simple food and not too much of it.”
Do monkeys eat Pringles?
Hope so because Kellogg is buying Pringles from Procter & Gamble in a $2.7 billion deal expected to close this summer.
Why?
For openers, Kellogg’s legacy brands (Corn Flakes and Rice Krispies) are under pressure from private labels and other breakfast convenience foods.
Note: Kellogg cranks out about 200 million pounds of private-label cereal a year.
The real growth for Kellogg, as well as for packaged-food rivals like PepsiCo and its Frito-Lay division, is foreign markets and snacks. That’s where Pringles comes in.
Kellogg’s CEO says that selling cereal and selling snacks are two entirely different skills.
What the company is buying with Pringles is not just a line of products that is already huge internationally, but a group of Procter & Gamble merchandisers with “the snack mind-set.”
“When you’re talking about snacks … it’s about someone who came into the store to buy something else and hit a display and thinks, ‘Hey, I’d love to have a can of Pringles.’
With snacks, it’s much more intercepting the consumer in-store as opposed to getting on their shopping list.
It’s in-store merchandising.
It’s retail entertainment.
Whereas cereal is much more about the 30-second feel-good ad.”
* * * * *
Nutrition note: According to Robert H. Lustig, a professor of clinical pediatrics at the University of California, San Francisco:
”People who consume sugar are more likely to overeat because “there are signals to the brain that tell you when you’ve had enough; sugar blocks them.
Eating calories from sugar will therefore lead you to consume more calories.”
Thanks to DM for feeding the lead
Having spent 3 tours of duty in Chicago, I’m a deep dish pizza aficionado … and loyal to Uno’s — the best!
Well, last trip in, the server directed our attention to a new twist on the menu:
Nearly 70 years after inventing deep dish pizza, Uno’s introduced a new deep dish crust in honor of National Pizza Month.
Uno’s invented deep dish pizza in 1943 and this is another industry first: the nine-grain deep dish crust – which likely cannot be found anywhere else in the world..
Being a curious kinda guy, I asked the server to name the 9-grains.
She named 2 and took off to get the manager.
He named 2 more, but we were still 5 short.
We were talking about the incident at a fam get together this weekend.
The real-time iPhone-Google searches came up short.
But, a friend (and loyal Homa Files reader) dogged for the facts.
Best she could find: Some dude named Bob throws 10 grains in his whole grain hot cereal.
Now, all we have to figure out is which grain didn’t make Uno’s cut.
Anybody know?
Thanks to MET for feeding the lead.
TakeAway: McDonald’s is giving consumers transparency into their agricultural suppliers to boost the image and quality of their food.
* * * * *
Excerpt from AdAge: “McDonald’s to Launch Campaign Focused on Growers”
On Jan. 2, McDonald’s will launch a campaign featuring four of its U.S. beef and produce suppliers.
“We thought putting a face on the quality of the food story would be a unique way to approach this,” said U.S. CMO.
“We acknowledge that there are questions about where our food comes from. I believe we’ve got an opportunity to accentuate that part of our story.”
The campaign will include TV, print and digital, as well as additional paid and earned media.
“Consumers want transparency — disclosures of everything from menus to labor and local-sourcing practices,” Technomic said.
“A small but growing number are serious about nutrition, labeling, sustainability and community involvement, and they are using such knowledge to make purchasing decisions.”
Edited by ARK
TakeAway: Fast food franchises are replacing drive-thru with delivery in Asia, Middle East, & African markets. Comin’ to America?
* * * * *
Excerpt from WSJ: “Asia Delivers for McDonald’s”
Delivery is becoming an important part of McDonalds and KFC where cities are too crowded and real estate costs too high to build drive-throughs.
KFC offers delivery in more than half its 3,500 restaurants in China, and estimates delivery in more than 2,000 new KFC restaurants in China over the next decade.
McDonalds says delivery sales have been posting double-digit growth every year in every country where it’s offered. In Egypt, where McDonald’s first started offering delivery in 1994, more than 30% of total sales come from delivery.
Still, it’s not a model either company plans to export to Western markets. McDonald’s derives about two-thirds of its sales in the U.S. from drive -through customers.
In some countries, such as China, customers pay a flat fee for delivery. In others, people pay a fee equal to 15% to 20% of their order price.
Edited by ARK
Most folks have dieted at one time or another to shed a few pounds.
Inevitably, the pounds creep back.
But, according to a place called the National Weight Control Registry, regaining lost weight isn’t inevitable:
Some people are able to lose a substantial amount of weight and keep it off at least a decade.
Here’s how they do it:
OK, I’ll start by having breakfast … the rest can come later.
TakeAway: Wendy’s remakes its hamburger, after 42 years, to boost sales and grow share in the fast food wars … New burger or New Coke? … The market will ultimately decide.
* * * * *
Excerpted from USAToday.com, “Wendy’s remakes its burgers; here’s how it did that”
Dave’s Hot ‘N Juicy, named after late Wendy’s founder Dave Thomas, is Wendy’s new burger — with extra cheese, a thicker beef patty, a buttered bun, and no mustard, among other changes …
“Our food was already good. We wanted it to be better. Isn’t that what long-term brands do? They reinvent themselves.”
Wendy’s started Project Gold Hamburger two and a half years ago to boost lackluster sales and fight growing competition from McDonald’s and expanding fast-casual chains, such as Five Guys …
But the biggest issue was that Wendy’s, which hadn’t changed its burger since the chain began in 1969, let its food offerings get stale over the years while its competitors continued to update their menus …
“We have a lot of catching up to do in some areas. But after we launch this hamburger there will be folks who need to catch up to us.”
Wendy’s polled more than 10,000 people about their likes and dislikes in hamburgers. It found that people like the food at Wendy’s but thought the brand hadn’t kept up with the times.
So, executives were shipped off to eat at burger joints around the country and measured each sandwich on characteristics like fatty flavor, salty flavor and whether the bun fell apart.
Then, it was time for Wendy’s researchers to consider the chain’s own burger, ingredient by ingredient. Each time they made a change, they asked for feedback, visiting research firms around the country to watch through two-way mirrors as people tried each variation.
Many suggestions sounded good but didn’t ring true with tasters.
Wendy’s ultimately did not go with the round shape, but changed the patty to a “natural square,” with wavy edges, because tasters said the straight edges looked processed.
Tasters said they wanted a thicker burger, so Wendy’s started packing the meat more loosely, trained grill cooks to press down on the patties two times instead of eight, and printed “Handle Like Eggs” on the boxes that the hamburger patties were shipped in so they wouldn’t get smashed.
Wendy’s researchers knew that customers wanted warmer and crunchier buns, so they decided that buttering them and then putting them through a toaster was the way to go.
In the end, Wendy’s researchers changed everything but the ketchup. They switched to whole-fat mayonnaise, nixed the mustard, and cut down on the pickles and onions, all to emphasize the flavor of the beef.
They also started storing the cheese at higher temperatures so it would melt better, … a change that required federal approval.
Wendy’s faces the reality that some customers may not like the new burger — or its likely price increase of 10 or 20 cents, because of the higher-quality ingredients.
Edit by KJM
After an immigration audit of its payrolls, burrito chain Chipotle Mexican Grill lost 450 of its roughly 1,200 employees in Minnesota.
Now it’s dealing with the aftermath— rising turnover – as workers concerned about their documents might have decided to seek employment elsewhere — and grumbling customers because of slower service from new employees.
When you went in there before … the quality was great,” says a longtime Chipotle fan in Minneapolis.
“Now it takes forever. People are slopping stuff together.”
Other areas being targeted by audits include Virginia and Washington, D.C.
“It is very troubling for us to lose so many great employees,” said a company spokesman.
Ken’s Take: “Slopping stuff together”? Isn’t a burrito – by definition – stuff that’s slopped together?
Lighten up, dude …
Business Week went “Behind Five Guys’ Beloved Burgers” … here’s some of what they found:
Five Guys’ that sells 2 million burgers a week and was named Zagat’s “best fast food burger” for 2010.
By the end of this year, Five Guys expects to have almost 1,000 stores open around the country, over $1 billion in sales and around 25,000 employees working in Five Guys stores.
Five Guys serves up made-to-order burgers with beef that’s never frozen and absurdly large servings of hand-cut fries.
The fresh, generous meals allow them to charge more than fast food chains such as McDonald’s and Burger King.
Five Guys stores seem to say, in the most loving way possible, “Shut up, sit down, and eat.”
A quirky aspect of their management style: frequent yelling during meetings. “It’s weird how it works … but You end up at the answer.”
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Ken’s Take: Nothing like a stop at Five Guys before a Hoyas’ basketball game. I knew I loved the place, now I know why …
I often use the expression: “Vanilla, chocolate & strawberry do the lion’s share of business” … implying that (a) Pareto is alive and well, and (b) variety often builds in complexity without building (much) sales.
Well, I’m going to start saying “vanilla and chocolate” … “vanilla, chocolate & buter pecan” just doesn’t sound right.
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Based on a Rasmussen survey of Adults’ flavor preferences in ice cream, the favorite flavors are:
Other findings:
According to Business Week:
Tyler Cowen is America’s Hottest Economist.
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Cowen’s menu searching advice:
Order the strangest thing on the menu.
Chances are the chef put the most work into it.
And, Cowen says the best ethnic food is prepared at strip malls.
Caveat diner.
Punch line: Orangutans and Thin Mints don’t mix
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Girl Scouts have been selling cookies since 1917.
Last year, troops sold 198 million boxes of cookies.
That’s $714 million worth of cookies, most of which goes to the nonprofit councils under which troops are organized.
But now the “franchise” is under pressure.
Scouts and leaders have criticized their nonprofit organization … and some do not want to sell cookies next year.
Why?
Until 2006, the cookies contained partially hydrogenated vegetable oil, but the scouts switched to palm oil so the cookies would be free of trans fat.
Today, all 16 varieties of GS cookies contain palm oil.
Some rain forests have been cleared for palm oil plantations.
Some endangered orangutans live in rain forests.
There’s the rub.
The Girl Scouts organization says its bakers have told them there isn’t a good alternative to palm oil that would ensure the same taste, texture and shelf life.
The choice: save orangutans or save Thin Mints, Trefoils and Samoas?
Headline in the WSJ: McDonald’s Under Pressure to Fire Ronald
More than 550 health professionals and organizations have signed a letter to McDonald’s. asking the maker of Happy Meals to stop marketing junk food to kids and fire Ronald McDonald.
The campaign is organized by the nonprofit watchdog group Corporate Accountability International, which has also targeted tobacco companies and beverage makers like Coca-Cola and PepsiCo for the environmental impact of plastic bottles.
The letter from the health providers urges McDonald’s to cease marketing food high in salt, fat, sugar and calories to kids, from the use of Ronald McDonald to Happy Meal toys.
Some of the comments to the WSJ article:
Add your comments … best one wins a free Happy Meal.
Thanks to SMH for feeding the lead.
A new Rasmussen Reports national survey reports …
Among those who eat pizza …
The last time they ate pizza, the respondents …
Getting hungry? I am …
TakeAway: Panera Bread investors are hoping the company’s new loyalty program and additional menu items will lead the way for continued sales and traffic growth. The loyalty program, MyPanera cards, is a way for the company to build deeper relationships with people who are already engaged with the brand.
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Excerpted from WSJ, “Panera Bread Sees Loyalty, Innovation Bringing in the Dough” By Annie Gasparro, February 11, 2011
On the heels of launching its customer-loyalty program, Panera is bringing in steak as new protein for its sandwiches, which, bolstered by extra marketing, are expected to help continue the trend of increasing sales, especially in the dinner and catering businesses.
The move to add steak to the menu comes at a time when beef prices are at all-time highs and rising, putting additional commodity pressure on Panera. But the company remains confident.
Panera’s loyalty program, MyPanera cards, is expected to be a key driver in future traffic growth, as it allows the company to track what its customers are buying, when they buy it and how much they spend. The free program was launched in the fourth quarter and presents members with “soft rewards,” like complimentary items, that match their buying habits.
This kind of insight can be used to make marketing substantially more effective, analysts point out. By giving a free bakery item to a customer who normally buys just coffee, Panera could create a higher-check customer long-term. In the same way, it could bring breakfast frequenters, for instance, in more regularly for lunch or dinner as well.
Panera isn’t afraid of raising prices coming out of the recession. The bakery chain says its overall commodity costs, about 80% of which are locked in for the year, will be up about 3% this year, causing the company to raise prices 2%. Panera’s bottom line improved through much of the recession, having increased every quarter in nearly three years largely due to customer loyalty. While competitors discounted to lure customers during a slump in dining demand, Panera’s aversion to price cuts succeeded among its base of mostly upper-middle-class customers and revenue growth never reversed.
Edit by AMW
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A new Rasmussen Reports national telephone survey finds:
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Rasmussen Reports, Those Who Eat Fast Food, January 20, 2011
TakeAway: Wendy’s announced a national marketing plan for its new recipe for French fries, the biggest overhaul of its fries in 41 years.
Wendy’s CMO admitted fries “are something we hadn’t been a leader in, in the past.”
The $25 million campaign aims to educate consumers about Wendy’s new fries that it hopes will compete mightily against McDonald’s.
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Excerpted from NYTimes, “Wendy’s Rethinks Fries in Nod to More Natural Foods” By Tanzina Vega, November 21, 2010
For the last year, the company has been examining its product line for opportunities to promote food made with more natural ingredients. Wendy’s “new natural-cut fries with sea salt” use Russet Burbank potatoes and are thinner and crisper than the current fries and will be unpeeled.
The idea is to provide an alternative to McDonald’s, which has long been the leader in French fry sales. The Wendy’s campaign includes two television spots that will run on cable and network stations such as TBS, VH1 and Bravo and during shows such as “Conan” and “Lopez Tonight.” The campaign includes two radio commercials that will air nationally, as well as billboards around the country to entice people to select Wendy’s when they get hungry.
The digital campaign includes the use of the Wendy’s Web site, a Twitter account, a Facebook fan page and digital banner ads. The company’s YouTube channel will feature an ad for the fries and the background of the Wendy’s Twitter account page will also feature art for the fries and a “Fry for All” app that lets users select a box of fries that they can post on their Facebook page so they can “share” fries with their friends. The idea of sharing is central to the campaign. “When something is really good, you don’t necessarily want to share it so easily,” said the chief executive and CEO of Wendy’s agency of record.
Edit by AMW
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Full Article:
http://www.nytimes.com/2010/11/22/business/media/22wendys.html?ref=media
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The Homa Files 