Archive for the ‘Restaurants’ Category

More reasons to be wary of restaurants’ table top touchscreens…

May 10, 2017

Olive Garden’s unauthorized “table game fee” opened a can of worms.

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In yesterday’s post, I whined about Olive Garden’s “profit scheme”: tacking an unauthorized “table game fee” to my bill .

For the gory details and the sleazy marketing “principles” underlying the practice, see Gotcha: Why I won’t go back to Olive Garden …

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When I googled “Ziosk” – what Olive Garden calls its devices – I was served links like Restaurant guests sour on Ziosk’s “touch it and you’re charged”  and Olive Garden servers are getting shorted on tips   … they exposed the  dirty underbelly of table top touchscreens.

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Gotcha: Why I won’t go back to Olive Garden …

May 9, 2017

For a measly 2 bucks, they lost me as a customer.

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In class, we cover Customer Lifetime Value – the math that captures a basic truth: businesses are better off getting repeat business from loyal customers than by gouging them on a single transaction.

Apparently, Olive Garden – which used to be one of my favorite chain restaurants — missed that class.

Yep, for a measly 2 bucks ($1.99 to be precise) they lost me as a customer.

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Here’s what soured our “relationship” ….

 

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“Don’t eat at Chick-fil-A” … say, what?

May 11, 2016

Chick-fil-A opened it’s first NYC outlet a couple of weeks ago.

It didn’t take long for uber-liberal Mayor Bill de Blasio to tell residents to boycott the restaurant.

 

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What’s his beef? (<= pun intended)

No, it’s not because of unsavory chicken or excessive customer service or Sunday closures (though the latter hints at the “problem”).

It’s because the company’s deeply religious President is a fan of traditional family values.

How are New Yorkers responding to the Mayor’s urging?

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Taco Bell: “Don’t say our beef isn’t beef …”

November 17, 2015

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?

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Memo to $15 /hour burger flippers: Meet Alpha, your competition.

September 16, 2014

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

McD for a buck - 1955 today
Source

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?

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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 …

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McDonald’s replacing $1 menu with a buck-and –a-half menu … ouch!

September 9, 2014

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.

 

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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 …

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Taco Bell: “Don’t say our beef isn’t beef …”

May 2, 2014

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?

(more…)

Gotcha: How long is a Subway footlong?

January 22, 2013

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.

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The picture-is-worth-a-thousand words is buzzing the internet.

Subway’s  corporate responses (two of them) are classics …

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Xmas dinner: Ditch the turkey, head for Mickey D’s

December 19, 2012

Could it be the beginning of a new Christmas tradition.

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According to AdAge, McDonald’s  is “urging U.S. restaurant owners to take the unusual step of opening on Christmas Day to deliver the world’s biggest hamburger chain with the gift of higher December sales.”

The move is a break from the company’s tradition of closing on major holidays.

An internal company memo counseled franchisees: “Our largest holiday opportunity as a system is Christmas Day. Last year, (company-operated) restaurants that opened on Christmas averaged $5,500 in sales.”

Many McDonald’s restaurants were open on Thanksgiving this year.

A former franchisee said:  “It’s easy to get kids to work on Thanksgiving because they want to get away from their family, but not on Christmas.”

Ray Kroc must be turning over in his grave.

He is dead, right?

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Price points: A McDouble for a buck … shoulda asked me.

December 11, 2012

In October, McDonald’s posted its first monthly drop in nine years.

The company immediately replaced the president of its U.S. business.

The new president “ramped up McDonald’s value messaging, focusing heavily on the Dollar Menu to help drive traffic”.

The company again renewed emphasis on low-priced menu options, such as $1 Sausage McMuffins and coffee.

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The result?

McDonald’s sales sales bounced back in November.

Surprise, surprise, surprise…

Source

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Follow on Twitter @KenHoma                         >> Latest Posts

How to goose Mickey D’s sales …

November 19, 2012

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 …

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Reported in USA Today, here are some of the ideas:

  • Push new products, new meal occasions and acta bit less fast-food-ish and a bit more like Panera or Chipotle.
  • Fix dinner … dinner is where McDonald’s struggles most … make dinner far more inviting with a dish that isn’t just another sandwich … such as a more upscale chopped steak platter … add baked potatoes at dinner
  • Serve breakfast all day … “bring back customers who come for McMuffins, but not burgers.”
  • More monthly specials … limited-time-only products, such as McRibs, are huge …have a new one every month to keep folks returning.
  • Sell sausage …  put a $1 bratwurst — not a hot dog — on the menu
  • Stop price creep … food got too expensive at McDonald’s ..  “reinvigorate” the $1 price point “to reconnect with price-conscious consumers.”
  • Consider home delivery …  Burger King is testing home delivery, and McDonald’s should, too.
  • Lure Millennials. Much like the Republican party, McDonald’s must appeal more to women, minorities and Millennials.

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Ken’s Take
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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 !

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Check your coat? … How about your cell phone?

August 27, 2012

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.

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Excerpted from brandchannel.com’s “To Cell or Not – While Dining Out”

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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.

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Chihuahua turning over in grave … Taco Bell heads upscale.

June 7, 2012

First, the bad news … you may have missed it, but Ginger the Taco Bell Chihuahua died a couple of years ago … 2009 to be precise … here’s the obit.

The bug-eyed dog who pitched 2 tacos for 99 cents  must be turning over in her grave.

     click to view Ginger pitching
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Why?

Well, according to the APTaco Bell, is going upscale.

The chain plans to rollout “gourmet Mexican” menu additions created by celebrity chef Lorena Garcia … venturing onto the turf of Chipotle  and Qdoba which are known for higher-quality ingredients.

It’s a departure from such standards as tacos, burritos and chalupas that Taco Bell’s core young-adult customers crave.

But, the Cantina Bell line could find a niche between Taco Bell’s less-expensive core items and the more-expensive fare at Mexican restaurants such as Chipotle and Qdoba.

The menu additions are bigger than the chain’s regular burritos … and will  take a bigger bite out of the wallet: The Cantina Burrito Bowl and Cantina Burrito, offered with chicken or steak, will sell for nearly $5 apiece.

Taco Bell executives acknowledged that the push for quality will draw some skepticism. … especially following a yearlong sales slump stemming from a  lawsuit that raised questions about its meat filling.

Ken’s Take:

(1) C’mon man, you’re Taco Bell!

(2) Next, they’ll start using real meat.

(3) No quiero, Taco Bell … if it’s going upscale.

I’m taking the under on this repositioning.

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Here’s what your food will look like … want it?

February 20, 2012

Takeaway: Some of my family members predictably respond to pictures on menus.

Heaven may have arrived on earth for them.

A London restaurant uses technology to give diners a virtual peek at how their food will look.  If  they like what they see, they can use the touchpad to enter their order.

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Excerpted from psfk.com “Giving Your Restaurant Order With The Click Of A Table

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In the Future of Retail report there is a fascinating example of an electronic mirror found at the Inamo St. James restaurant on London’s Regent Street.

On our recent trip to the UK we visited the restaurant to try out the interactive tables that all diners use there.

When diners sit, a screen is projected on the table and through the use of a touchpad they can order drinks, food, games and even a taxi.

A fun aspect of the interaction is that a diner can see how the dishes will look once served — an image gets projected on a plate on the table before they order.

With a mouse click, each dish can be added to a list — and then when the diner is happy with their selection that list of orders is electronically sent to the kitchen.

And if the diner is wondering what is happening while they wait they have a range of options.

For a start, they can open a video window on the table with a live feed from the kitchen or they can entertain themselves by changing the projected table-cloth, choosing from various photographs and patterns …

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Taking the mystery out of “mystery meat” …

December 22, 2011

TakeAway: McDonald’s is giving consumers transparency into their agricultural suppliers to boost the image and quality of their food.

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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

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Knock, knock … here’s your Big Mac.

December 14, 2011

TakeAway: Fast food franchises are replacing drive-thru with delivery in Asia, Middle East, & African markets. Comin’ to America?

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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

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Kicking over the Cracker Barrel

November 18, 2011

Cracker Barrel is one my favorite stops along a travel route.

Now, it’s in the sights of a takeover guy whose formula is slashing costs.

Isn’t anything sacred any more?

A Buffett Devotee Riles His Targets .

He likes restaurants and insurers, runs a company called “BH” and writes long, self-effacing annual letters to shareholders.

Sardar Biglari,— the self-described Warren Buffett wannabe – runs the Steak ‘n Shake restaurant chain alongside stock investments and other holdings.

Today, entryways to Steak ‘n Shake restaurants, which he turned around in part by slashing costs and closing unprofitable locations, display large photos of a grinning Mr. Biglari.

Now, he has  set his sights on Cracker Barrel Old Country Store.

“We blame the board for mediocrity,” he said in a Sept. 12 letter to Cracker Barrel shareholders. “I intend to raise expectations.”

Cracker Barrel, a down-home restaurant and gift store whose results have turned south with the slow economy, initially tried to accommodate Mr. Biglari’s requests.

But as his demands grew more intrusive, relations soured. The company recently adopted a poison-pill antitakeover provision, and Mr. Biglari launched a proxy fight to get himself elected to the board.

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