Let's hear it for carrots

This has been an exceptional week for carrots. First, lawmakers in Virginia decided to curb restaurant patrons’ exposure to cigarette smoke by leading consumers to places that voluntarily ban it, instead of ordering all establishments to snuff out the butts. A bill approved yesterday in one chamber of the state’s legislature would require places that permit smoking to post a sign forewarning customers of the proprietor’s choice. Proponents believe the measure will clear the air of more restaurants by giving them a business incentive to prohibit smoking.

Now comes word that Los Angeles County is trying to purge trans fats from the kitchens of its restaurants by offering a marketing incentive to places that voluntarily yank the heart clogger from their recipes. Under an agreement brokered by the local restaurant association, places that eliminate trans fats will be given a decal they can post in their windows, certifying that the establishment is heart-friendly. The signs presumably will shape consumer behavior, which in turn will lead more restaurants to rid their places of the partially hydrogenated oils.

By making a certain “go” more attractive, both areas may be able to avoid the flat-out “no” of bans.

You'll pay one way or another

Restaurants’ traditional sick-leave policy can be summed up in four words: No work, no pay. That hard-nosed stance may be scorned by employees and faulted by the public, but the trade insists it’s necessary to avert red ink. How can a restaurant afford to pay an hourly staffer who’s out sick and the person who’s filling in for him or her? What’ll that do to margins that are already thinner than a crepe?

The industry is about to find out, beginning in San Francisco next week. The city is the first place in the country to mandate paid sick leave from restaurants and other employers, but it certainly won’t be the last. If public disdain for the industry’s current sick-leave standard doesn’t force the change, well-founded concerns about the health risks certainly will.

By all accounts, residents of San Francisco didn’t vote in a referendum to mandate paid sick leave in their city because of concerns that an ailing restaurant employee might pass along the infection to them. Rather, all the observers say the requirement was approved by 61 percent of voters out of a sense of fairness. How can you expect restaurant workers to get by if the flu or some other ailment waylays them for a week? It just didn’t seem right, at least if you viewed the situation from the employee’s standpoint.

So, starting Feb. 5, restaurant staffers will accrue one hour of paid sick-leave time for every 30 hours they work. Assuming that a server puts in five hours a day, six days a week, that waiter or waitress would be entitled to one paid sick day every five weeks, or 10 per year. In one of the regulations few qualifications, businesses that employ fewer than 10 people are protected by a cap of 40 hours of paid leave per year. For all others, the maximum benefit is 72 hours.

And it applies across the board, to part-time employees as well as full-timers. Opponents not that even a babysitter or the kid who cuts someone’s lawn would be entitled to the benefit.

That considerable burden to small businesses might serve as a yellow light to other areas. But the bright green signal is the health risk of a non-paid sickness policy. If people have to forego their income if they don’t work, they’re strongly motivated to clock in even if they’re running to the bathroom every few minutes. They’ll just have to hope their fellow kitchen workers will cover for them during those frequent breaks from their food-handling duties.

With the current prevalence of hepatitis A and norovirus, that situation could pose a profound community health hazard. Three employees of an Olive Garden in an Indianapolis suburb reportedly came to work while stricken with the latter ailment, more commonly known as the cruise-ship virus. About 370 customers were said to have taken ill afterward. No wonder local health officials indicated that they were speaking with representatives of the restaurant about its sick-leave policies.

The big question is, how can a restaurant extend paid sick leave to its employees without making its investors more than a little nauseous? This is one were the pressure on the industry may be reasonable, but so are the objections about the cost.

At the very least, it should take action instead of waiting until it’s ordered what to do, as it was in San Francisco. The trade was caught entirely unaware, and I’d bet to this day that most operators are oblivious to what’s about to happen out there.

The trade should push hard now to prevent the Bay City’s set-up from being adopted as a model by other municipalities, counties and possibly even states. The benefit that was mandated there is out of whack with any business sense.

It also needs to develop an alternative standard that addresses the public-health implications of the no work/no pay approach. Short of solution from Hogwarts, any change is going to cost the trade. But it may be better to find a way of assuming a small burden now, lest it be really saddled in the next election or food-borne-illness outbreak.

Pizza chains see America changing

A flurry of recent nrn.com stories didn’t appear to have much of a connection beyond the mention in each of pizza. Yet the shared mindset given away by another common term suggests they’re actually as interwoven as the potholder a 7-year-old fashions at summer camp. Taken as a group, they’re strong evidence that the pizza posse is the first segment of the business to realize truly and zealously the potential of the Hispanic market.

And, most important of all, a number of chains in that sector are actually doing something about it. The industry has been squawking about the opportunity since right after Columbus arrived. Yet it took the apparent success of a concept that dared to leave the conga line and move to its own beat for others to give some bold moves a try.

Let’s pick it up with the story posted a few weeks ago about Peter Piper Pizza being purchased by a private equity company that specializes in businesses serving the Hispanic trade. The buyer, Washington, D.C.-based ACON Investments, indicated that it would intensify the Southwestern chain’s focus on Latinos. “We see a terrific opportunity to take advantage of the continued growth and expanding purchasing power of the Hispanic population,” ACON managing partner Daniel Jinich said in a statement announcing the deal, without revealing how much he and his partners paid for the 130-unit chain.

Now jump to today’s batch of news stories. You’ll find one about Pizza Hut adding a feature to the Spanish-language version of its website that allows visitors to order online, as far in advance as a week of when they want their pies. It’s likely to be a real boon for people planning a family gathering or other sizeable get-togethers.

No doubt the chain was “inspired” by the success that arch-rival Papa John’s says it’s had with a very similar set-up. That organization added the service in October.

In our Financial News section, you’ll see why so many pizza chains have suddenly become infatuated with the Hispanic market. For reasons that may have more to do with soliciting expansion partners than informing financial ones, privately held Pizza Patron disclosed that October-through-December sales at its units had shot past the tally for the last quarter of 2005 by an average of 34.6 percent. In case you’re not familiar with the concept, Pizza Patron (pronounced pa-trone, not pay-trin) was conceived as a brand that would serve Hispanic consumers and communities.

As we reported last week, as part of that effort, the chain undertook a limited-time offer in which it accepted pesos as well as dollars. It drew scathing criticism from people who believed it was pandering to illegal immigrants, but the brand let its targeted clientele know that it’s serving them.

And now, as we’ll likely to continue to report in coming weeks, it’s hardly alone in undertaking that mission.

Having a cow over rBGH

Keep this to yourself, but disagreements erupt fairly frequently within the editorial staff of Nation’s Restaurant News, just as they do in any other newspaper. But the one that simmered at a low level for several days last week should be of four-alarm interest to any restaurateur who uses a dairy product or sells a hamburger. It’s a preview of an issue that could become a hot one for the trade, in part because it’s the first to be fanned by that powerful new instigator of public outrage, the blogosphere.

For the sake of full disclosure, I’m compelled to note that I was one of the disputers. I’m not going to identify the colleague who took the other side. All you need to know is that we both have more than 20 years of experience in covering the business, and hold comparable positions within the organization. And that he was right, though both you and your potential adversaries—a formidable lot, to be sure—would probably both line up behind me. That’s precisely the problem.

The flashpoint was a news short I wrote up for www.nrn.com about a change underway at Starbucks. The coffee giant divulged that it’s switching exclusively to milk and dairy products that contain no recombinant bovine growth hormone, a controversial genetically engineered substance known as rBGH. Or as a spokesman told the Reuters news service, "We are actively engaged with all our dairy suppliers to explore converting our core dairy products to be rBGH-free in our U.S. company-owned stores.” That’s how the home office put it—a switch to rBGH-free milk, half-and-half and whipped cream.

That might be what they said, my colleague observed after he saw the item, but it makes no sense. rBGH is a compound that’s injected into cows to boost their milk output. There’s more milk coming out of a treated cow, but the fluid itself is as rBGH-free as the output of a non-injected animal, as the Food & Drug Administration and the scientific community has concluded. Indeed, dairies that market their milk as coming from untreated cows have to alert consumers that the milk is no different from what a rBGH-injected cow produces.

What Starbucks really means, my co-worker continued, is that it’ll switch to dairy products made with milk from cows that weren’t given the hormone. Authorities say the use of rBGH increases an animal’s chances of an udder infection, called mastitis, which is then treated with antibiotics. Watchdogs have contended that the antibiotics and pus from the infections can get into the milk from those cattle.

My position was, and remains, that my story had to recount what Starbucks said, not how it should have articulated the point. But my friend is correct. The trouble is, Starbucks apparently didn’t appreciate what he did. Nor do the bloggers and internet-focused advocacy groups who drove the chain to make its pledge to go rBGH-free.

A group called the Cancer Prevention Coalition has this posted on its website, as I discovered by Googling rBGH: “rBGH milk differs from natural milk chemically, nutritionally, pharmacologically and immunologically.”

The Ethicurean was one of the bloggers who urged consumers to participate in a virtual protest by calling Starbucks en masse on Dec. 5 to “let them know that you want your milk rBGH-free.” In other words, to pursue a fallacy.

Food & Water Watch also implored the public to participate in Starbucks National Call-In Day. “In fact, any day is a good day to tell Starbucks to switch to rBGH-free milk,” the advocacy group says on its website, www.foodandwaterwatch.org.

Clearly, the facts are getting lost. And it’s not just a matter of semantics. By suggesting there’s a genetically engineered growth hormone in the milk your child might be drinking, the advocates are conjuring up a danger that doesn’t exist.

One other thing the restaurant industry should consider: Right now the focus is on milk. But advocates assert that rBGH taints the flesh of injected cows as well, even though authorities have dismissed that contention as groundless. And 40 percent of the cattle whose meat is ground into hamburger are old dairy cows, as one of the anti-rBGH sites notes.

Is the King's a real Whopper?

Burger King’s mascot must not have apprenticed for his kingship in Great Britain, where you’d expect royal etiquette to be taught in the monarchy’s grade schools, along with jousting and defense against the dark arts. How else can you explain why the wooden-faced King and his minions keep getting into trouble over there?

As The Scoop reported, a high-level BK executive risked dungeon time a few weeks ago by asserting that the chain’s U.K. operation would probably lose at least 10 percent of its sales to a ban there on fast-food advertising during children’s telly programs. Within hours, BK headquarters in Miami was scrambling to halt the damage, asserting in a terse statement that the effect of the ban would actually be negligible. The quick sword work likely tempered the dip in the franchisor’s stock price.

Now comes word from across the pond that the King had turned knave again. The House of Whopper has been told to yank its television ads for the Double Whopper because of complaints that the specimen shown in the commercials is far larger than the sandwich sold in units. The Advertising Standards Authority agreed that the spots were misleading, and banished the King to darkness, at least for come-ons for that product.

There’s no word yet on how BK will close the gap between what’s shown in the commercials—or adverts, as the British call them—and what’s sold in the stores. Put another way, it’s not sure what the chain will upgrade, the floor model or the inventory.

Who's smarter, Ronald or the lobster?

Two of the industry’s largest and most successful companies divulged radically different strategies last week for maintaining those distinctions. McDonald’s acknowledged (with enough qualifications to please any lawyer) that it may indeed part with its Boston Market business in the near future to focus singularly on its resurging hamburger chain. Almost simultaneously, Darden Restaurants confided to investors that it may pursue the acquisition of a mid-sized chain—possibly even one that’s franchised—as a shot of Viagra for the greybeard of casual dining.

Two stellar successes, both hailed for their management acumen, each having changed the trade with their substance and styles, now reading the near-term future of the business in decidedly different ways. The question is, which one is right?

History clearly gives McD’s the better odds. Time and again, single-chain over-achievers have attempted to parlay their success into a foodservice version of the super-group. And with memorably few exceptions, the effort fails more miserably than NBC’s typical fall line-up. Burger King gave it a try with Godfather’s, Quick Wok and Haagen-Dazs, at a time when the burger chain was itself a part of a Pillsbury Corp. portfolio that included Steak and Ale and Bennigan’s. A bridge game on the Titanic would have been a more-reminisced gathering.

McDonald’s itself has tried its hand at empire building several times, starting in the days when Ray Kroc added a pie concept called Lisa Dobbins Pie Tree and a namesake gourmet burger venture called Ramond’s. More recently, its basket of brands has included Chipotle Mexican Grill, Donatos Pizza, Fazoli’s, McDonald’s with a Diner Inside, Golden Arch Café and McCafe, among others. If it indeed spins off Boston Markets, its lone remaining diversification would be a one-third stake in the Pret A Manger sandwich chain, a London powerhouse that has yet to wow Americans in its sole U.S. market of New York.

Fast-food giants aren’t the only ones who’ve stumbled in trying to add side projects. Applebee’s thought it found a new growth vehicle in Rio Bravo, a Mexican concept that had been started by its founder, Bill Palmer, who now runs the successful Up the Creek casual chain. It was more of a disaster than a teen bringing his tattooist home to meet the folks.

But there’s a profound argument in favor of growing through the addition of new brands: Darden itself. Its Olive Garden holding is arguably now overshadowing the company’s firstborn, Red Lobster. And Seasons 52, just now moving up from farm-league status for a shot at the big leagues, has been lauded as a Derek Jeter-caliber prospect. Diversification has clearly worked for the multi-billion-dollar heavyweight.

It took the company a long time to crack the code, however. At one time, its holdings extended to ventures like The Good Earth, a healthfood restaurant chain, and a higher-end T.G.I. Friday’s challenger named Darryl’s. And any observer of the sector knows that recent side projects have not gone well, from China Coast to Bahama Breeze and Smokey Bones.

Its experience underscores that it’s not a matter of acquisitions per se being helpful or detrimental. It’s more a matter of how astutely a buyer shops. Addressing investors and analysts last Thursday and Friday, Darden was specific about what kind of restaurant operation it might buy: One with about 100 units and a national reputation. And, presumably, a strong performer already in whatever nook of casual dining it plans to make its own.

Yeah, but every acquirer sets out to make a smart purchase. The issue is that few succeed.

So which is the better strategy, McDonald’s laser focus on one brand, or Darden’s scenario of buying a growth ticket if conditions are just right?

Bookmark www.nrn.com, and we’ll be sure to let you know.

Perfect pairings

Ever on the prowl for ways to serve the restaurant community, The Scoop has decided to give matchmaking a try. And what better way to start than with these obvious pairings, suggested by recent headlines?

David Rockwell and McDonald’s – Rockwell, the rock star of interior design, is know for the sense of theater he instills in his creations, be it a restaurant (Nobu, Ruby Foo’s), a casino (Mohegan Sun) or an actual stage (the sets for the Broadway hit “Hairspray”).

And now, The New York Times reported Wednesday, Rockwell is turning his attention to the sandbox. A page-one story noted that the much-in-demand designer has agreed to come up with a 21st-Century version of the children’s playground for the City of New York. Although details have apparently not been finalized, the plans call for features like wooden ramps that tykes can run up and down; a “water zone;” and a mini-crane the kids could use as a group to fill things with sand. A prototype will be built in Manhattan, with other areas of the city encouraged to copycat it at will.

Now consider what McDonald’s is doing with its Playland indoor rec areas, one of the sleeper factors in the chain’s success. Headquarters has said it wants to convert those facilities into mini-exercise centers, called R Gyms, where kids can pedal stationary bikes, zip through an obstacle course, work up a sweat at air hockey, or shoot hoops. The stated mission is encouraging mini-patrons to be more active. Cynics contend that McD’s merely wants to mute the criticism that it’s plumping up kids without a thought about their health.

Whatever theory you buy, there’s no disputing the chain’s intent to cop a more contemporary approach to play. What better way than having Rockwell come up with something that would be to indoor playgrounds what Starbucks was to the old coffee shop?

Bubba Gump and Chris Thomas – Bubba Gump Shrimp Co., a sleeper in its own right, announced yesterday that it’s willing to sell a stake in the 24-unit chain to generate expansion capital. Last week, Sizzler and Planet Hollywood vet Chris Thomas got together with his similarly seasoned partners, former Chart House chief John Creed and one-time Embassy Suites head Clyde Culp, to announce they’d amassed a bushel of cash for restaurant acquisitions.

Is this matchmaking stuff a breeze or what?

Thomas’ firm, Restaurant Acquisition Partners, raised the money through a stock offering on Dec. 15, without an operating business currently in its fold. As what’s known as a blank-check company, it generates capital first, then hunts for a business where it could be put to use.

Creed comes from a seafood chain that preferred showcase locations; Thomas knows about Hollywood-themed movies; and Culp is an old hand at franchising and site development. Gump is a seafood dinnerhouse brand inspired by a hit flick, and franchises its big, high-volume restaurants, often in tourist destinations.

Their families should meet.

Meth Coffee and Miss Manners– It is the policy of The Scoop to avoid supplier brand names so you won’t suspect me of whoring for an advertiser. I don’t think there’ll be much risk of that here. Yesterday brought the announcement of a new hot beverage, presumably for the grocery market, but possibly slated for a subsequent push into foodservice. It’s called Meth Coffee, a “hard-hitting coffee roast for energy addicts,” ideal for “boosting stamina and mental clarity,” the promotional materials explained.

Targeted customers, the announcement continued, include “thrill seekers” and “workaholics” in need of a “jumpstart.”

Okay, we get it. It’s the crystal meth of coffee. And what could be funnier or more clever than trying to push your product by playing off a drug epidemic? Why not market it with some Crack Cakes, or a line of doughnuts called Drunk Dunks?

Indeed, the product is noteworthy. It sets a new standard in poor taste.

Big chains go Islamic

In the beginning, one version had to fit all eaters. Restaurant chains were founded on the principle of menu conformity, in part because patrons equated variation with unpleasant surprises, and largely to lower prices through mass production. Their burger was the burger you got, regardless of how you wanted it.

But in recent years, even the mass-market giants have eased their insistence on one choice for all. You can not only custom-spec your burger, but also opt for products that were developed for a particular sector of the market, be it the health-conscious or the skateboard set.

Now the industry’s mass producers are going further and addressing an inch-wide but rapidly expanding splinter of the U.S. marketplace: Followers of Islam. As the Chicago Tribune reported last week, a number of the major chains, from KFC to McDonald’s and Subway, are revamping their recipes to offer signatures that conform to Islamic dietary law. That entails using halal meat, or the flesh of chickens and cattle that are slaughtered in an approved fashion.

And don’t forget lamb. Outback now offers a dish made with a type of New Zealand lamb that qualifies as halal.

It’s not as if a halal chicken is perceivably different from a typical unsanctioned bird, as I can attest from personal experience. At least once a week, deputy editor Paul Frumkin and I head down the street here in New York for some halal chicken. We could get it from any of probably 15 carts within a half-mile radius.

We couldn’t care less that the chicken topping our rice platters is halal. But halal choices tend to be offered in New York—and presumably a number of other major cities—by Middle Eastern immigrants who cook in the style of their homelands. That means marinated and highly spiced proteins garnished with fiery or palate-cooling sauces, and often both. The chicken tastes no different per se, but vendors of the halal version tend to spice it distinctively.

The U.S. chains experimenting with halal choices are holding to their current recipes; they’re merely using halal beef or chicken in place of the non-blessed variety. And those variations have been extremely limited in scale. McDonald’s has two halal outlets, according to the Tribune story, and other press reports indicate that KFC also has only two halal outlets. Subway reportedly has a lone outlet, in New Jersey.

But those limited endeavors have been enough to stir up controversy, because the halal designation requires those mega-volume feeders to veer far from their normal supply route. They have to buy the meat of animals that were blessed in accordance with Islamic law, then slaughtered in ritualistic fashion (i.e., the throat slit by a holy person, and the blood drained).

The halal KFC stores have been assailed by some Islamic believers for selling chicken that was blessed but mechanically slaughtered. The critics say that’s the reformed version of hala, not the true form. And that’s not kosher in their eyes.

It’s also unclear how a halal quick-service outlet would handle breakfast. Pork is patently a disqualifier, which means a store would have to forego bacon and pork sausage if it wanted to keep its halal designation.

The halal units opened thus far by the big U.S. quick-service chains are all in areas with sizeable Muslim populations. It remains to be seen how stores with that designation would be received in mainstream areas. But how could they miss? With the exception of some tweaks to the breakfast menu, non-Islamic customers would not have to sacrifice a thing. And they could count on the business of Frumkin and me, which is fairly considerable.

Dam that sentiment

Twang-g-g-g-g.

Looks as if the price of bottled water isn’t as elastic as restaurateurs might have thought. After charging as much for H20 as they once collected for a dinner’s complement of wine, the trade has triggered a full-fledged backlash, replete with an advocacy group, a deeply felt cause, and a loudly articulated action plan. The battle cry: Drink tap instead.

The only good news, at least from the restaurant industry’s perspective, is that the British-born crusade has yet to jump across the pond to the U.S.

If American restaurateurs are smart, they’ll try to contain the movement to Europe, like Mad Cow Disease, or the popularity of Jerry Lewis. Over there, a group calling itself the Consumer Council for Water—CCWater, for short—is arguing that patrons should forego the higher ticket of bottled waters, not only for the sake of economic sense, but also for ecological reasons. When you pop for a liter of spring water, you end up not only with dirty water glasses, but also a bottle that has to be channeled to a landfill.

What’s more, the group suggests, bottled water can be wasteful. With H20 diminishing in supply, it’s far more appropriate to drink as you go, glass by glass, instead of consuming in liter-sized increments that may not be entirely consumed.

The group isn’t a bunch of yahoos, as you can tell from a visit to its site, http://www.ccwater.org.uk. Its larger goal is conserving water, and it cites indications that 76 percent of British consumers don’t believe water companies do enough to conserve. It’s presumably speaking there about utilities, not water bottlers. But it’s just a slight extension to include those parties in their scope.

CCWater realizes that one of the major difficulties in getting consumers to specify tap water instead of the bottled variety is the stigma involved. Patrons are embarrassed about going with the free stuff because they’re afraid it’ll make them look cheap and uncouth.

But no one wants to look like a fool, either. And that’s how patrons might feel if they discover they’re paying as much for their water as they might for an entrée or dessert.

Bye to hockey pucks, cash, Peltz's silence

It’s a little-known nugget of trivia, but George Romero patterned the zombies in “Night of the Living Dead” after journalists who’ve just changed their calendars to a new year. They’ll stop for nothing—not a Tom Cruise meltdown, not a free buffet, not even an open bar—until they’ve sated whatever supernatural force compels them to greet Jan. 1 with a slate of predictions.

And who am I to shoo swallows away from Capistrano, or to deflect salmon from swimming upstream? In keeping with natural law, here are my prognostications for 2007.

Hockey pucks are doomed: If restaurant trends really do start in fine dining and trickle down, then we’re about to see fast-food chains reconsider those granite-like frozen rounds they plunk on their grills for conversion into what they now peddle as burgers. One of the dominant high-end trends of 2006 was a sharp interest among big-name chefs in the possibilities of the burger. Kitchen stars with names you usually see boldfaced in the consumer media were suddenly experimenting with new meats (think Angus or Kobe), new grinds (more fat content), or ingredients (especially foie gras and truffles. And, seemingly, it’s worked. The pack of high-end new burger places in New York are packed.

We’re already seeing it happen in the quick-service market with Carl’s Jr.’s Six Dollar Burger, which is several years old by this point. But look for more regional chains and upstarts to try upscale riffs on the American classic, followed by the mega-brands like McDonald’s and Burger King. We’ll soon be seeing menus studded with descriptors like “hand-formed,” “custom ground” and “never frozen.”

Cash, once king, heads into exile: Last year brought us what is probably the industry’s first cashless restaurant, a Washington, D.C. café called Snaps. The only green or silver it wants to see is the glint of a credit or debit card.

That’s a little extreme, given how few kids carry plastic, or even wallets. Ditto for lots of college kids. But more places—at the low-end, not the high—will likely urge patrons in subtle ways to forego the time needed to process a cash transaction. They’ll wager that whatever additional amounts they pay in processing fees will be offset by the higher volume they can generate during peak hours.

They key, obviously, will be new technology, like devices that allow servers to settle a credit-card tab right at the table, or EZ Pass-like automatic charge systems. That fits into the next big trend of 2007…

Transaction compression will be the new byword: Restaurateurs and customers may have different reasons, but both will celebrate new technology and procedures that streamline the necessary evil of settling tabs. Operators, and fast-food managers in particular, want to slash that time so they can handle more patrons, and make time-crunched customers that much happier. Guests just see no benefit in the process being dragged out, and will become more strident in letting that be known.

This is one of those rare situations where there’s no down side, provided the gizmos and set-ups work as promised.

Group business becomes the new takeout: Is there a full-service restaurant built today that doesn’t have a party room, or a space that could be turned into one? And would it likely forego catering?

Is there a sandwich chain or other fast-casual concept that enters the market without a strategy for landing big orders, be it a business’ lunch order for a meeting, a meal for the doctor’s office that a pharmaceutical salesperson wants to woo, or all the fixings for a Raven fan’s Super Bowl party?

Restaurateurs of all stripes have individually discovered the potential for those large orders. In 2007, the industry as a whole is going to awaken to the prospect. Casual concepts that don’t open for lunch may instead offer in-office catering services at midday. We’ll see innovation in packaging that allows big-order specialists to capture the soft-drink sales they’re currently failing to land, and anyone with an oven will be experimenting with travel-friendly new entrees, like lasagna, or casseroles rechristened with a sexier name. It will become one of the major targets of the new year, just as takeout zoomed out of nowhere to become a prized opportunity for casual chains a few years back.

Nelson Peltz socks Michael Jacobson: Angered by the profit-shaving cost of trans-fat-free oils, activist shareholders turn on the consumer advocates who pressed restaurant companies to adopt the healthier (but costlier) frying medium. In one memorable exchange, Nelson Peltz breaks his public silence to challenge CSPI chief Michael Jacobson to a joust—polo ponies at 20 yards. Jacobson declines, citing the potential for cruelty to animals, and they thumb-wrestle instead.

Actually, I don’t think that’ll happen at all. But a man can dream, can’t he?

Wringing out New Year's Eve

There wasn’t a word about this on the major news sites, but this is big, people: In some parts of the country, revelers will have to remain stone sober this New Year’s Eve, even if they plunk down some serious coin for one of those fancy dinner-and-dancing restaurant packages. Which means the establishments in those areas are going to lose all those high-ticket Champagne, wine and cocktail orders that give them a nice start to the next 12 months.

The party pooper is the calendar. New Year’s Eve falls on a Sunday night, and many areas prohibit the sale of alcohol on the Christian Sabbath. So if residents of those areas want to toast 2007 with a glass of champagne at midnight, they’ll be doing it in their homes.

This is the first time this has happened since the year 2000. But there is a bright side: There won’t be a similar time warp back to Prohibition for another decade.

Some jousting within the King's court

Looks as if the King has discovered a joker within his ranks. The House of Whopper had to do some fast damage control after a European executive told a London newspaper that Burger King’s halt on advertising to kids in Great Britain would cut sales there “without doubt by approximately 10 to 15 percent." That translates into a loss of about $196 million, according to the Daily Telegraph story.

“It will have a major impact on our top line," Giorgio Minardi, vice president of Burger King’s northwest-Europe operations, explained to the paper. It noted that Minardi’s comments came in the first interview he’s granted since moving to BK from arch-rival McDonald’s earlier this year.

And he pretty much flubbed it, BK’s home office in Miami suggested a few hours later with a terse statement. Without mentioning Minardi or his prediction, the media release said the discontinuation of ads aimed at children would have “minimal impact.” Or at least on Burger King. The situation for Minardi’s former employer is a far different thing, suggested BK European president Peter Robinson.

"Our target consumer for many years has been 18 to 34 years old,” Robinson said in the statement. “We expect the advertising ban to have a far greater impact on our competitors who have previously targeted children as a core consumer."

Of course, those competitors won’t find out for several weeks after BK is gauging the actual impact of the halt in kids ads. The official “junk food” ban will be phased into effect starting at the end of January. But BK pledged in the fall to halt its commercials before Christmas, as indeed it did last week, in the midst of the busy holiday shopping season.

There’s been no response yet from Minardi about being contradicted by headquarters. Come to think of it, there’s been no word from him at all since his maiden interview. Why do I think it’ll be a long time until we hear from him again?

It’s a shame, too, because it’s nice to witness some actual candor in this age of media training, spin-doctoring and professional muzzlers.

6 things that shouldn’t survive 2006

When the big ball drops in Times Square on Dec. 31, we can only hope these industry annoyances pass with it:

The call-us-back-to-confirm-reservations ruse: Ahh, of course I’ll make it my responsibility to give you a confirmation call before I step into your restaurant to spend a few hundred dollars on a meal. It’s the least I can do to spare you lost sales and anxiety, not to mention effort and aggravation.

Hey, why don’t I just cook the food and serve it to myself, too? After I hang up my coat and fetch my wine selection, too.

Glasses of wine priced at the level of an entrée: America is drinking better, but price gouging has been elevated to an art. When you know a bottle of your wine selection would retail for less than twice the price of a glass, something’s wrong. Speaking as a consumer, I’d much rather pay a reasonable mark-up several times than pop for a single wallet-buster. And as a business person, I can’t help but wonder when there’ll be a backlash. Some companies are already rewriting their travel policies to deny reimbursement for alcoholic beverages consumed solo, as when you have a glass of wine with a late hotel dinner.

The pooh-poohing of the avian flu threat: Even the National Restaurant Association had predicted the much-feared disease would appear somewhere in the United States during 2006 (in the summertime, to be precise). As did many of the white-coated lab geeks who stepped before a camera now and again to warn of the dire possibilities. But, despite a few low-level scares, the dreaded disease never appeared as expected, and the public’s apprehension dissolved like Michael Jackson’s career. Which is frightening, because the danger wasn’t miscalculated; only the timing was. Yet the public seemingly believes the danger is past—that we dodged a bullet.

In truth, nothing’s changed but the perception. And that’s set the public up for a shock that could have consumers hunkering down in their basements with pots on their heads. The window for convincing them that the disease could be managed stayed open longer than expected, yet the opportunity wasn’t exploited. Instead, we have situations like the one in Marin County, Calif., where 40,000 school children recently brought home flyers warning their parents of the disease’s potentially devastating effects and encouraging them to stockpile water and other essential supplies. Oh, yeah, that’ll really help restaurant sales if an instance of avian flu is reported. And those mom and dads will be certain to let little Tyler or Tiffany head to their jobs at KFC, Houston’s, McDonald’s or any other place where they might be handling chicken.

The warnings aren’t the problem. It’s the industry’s complacency that is. It should be teaching the public that this is a virus that dies with proper cooking, so cooked chicken and poultry aren’t a threat. Yet there’s not a peep from the trade.

We can only hope that reticence will end before we hear the yelp that avian flu has indeed landed here. And keep in mind that authorities have yet to say what killed more than 2,500 ducks in a matter of days near a spring in the wilds of Idaho in mid-December. They’ve acknowledged that they’re testing the carcasses for avian flu, so the alarm could be sounded soon.

Paris Hilton’s stardom: This has absolutely nothing to do with the restaurant industry. But my list of things that should end with 2006 would be deceitfully incomplete mentioning it.

Militant shareholders: Wall Street has crowed that activists like Bill Ackman, Nelson Peltz and the crew at Pirate Capital did a service for investors by goading management to make critical strategic changes. And, indeed, the share prices of victims like McDonald’s and Wendy’s have climbed. But that assessment is based on short-term gains, not the long range. Who among the gadflies has more money, a better business mind, or a healthier portfolio than Warrant Buffet? And his strategy? Buy and hold for the long range, and don’t interfere in the day to day.

Besides, it’s hard to support the very notion that shareholders can redirect a company’s activities on their whim. It’s like championing shower mold, or naming your kid after George Steinbrenner.

Nelson Peltz’s silence: I’m still hoping for an interview with the media-shy investment activist, something that I might’ve mentioned here a time or two, and maybe in my column in Nation’s Restaurant News.

Oh, well. It’s a brand-new year. Maybe he’ll come around in ’07.

In the meantime, a happy holiday to all you readers, and thanks for your attention during this first year of The Scoop.

Don't quit the day job, Greg

I’m just the messenger on this because I hadn’t seen the ads until tonight. But I don’t think the criticism was unjustly harsh or off-target. If my friends and colleagues are any indication, Taco Bell’s attempt to allay food-safety concerns with a commercial featuring chain president Greg Creed is a waste of money. It’s not as if those associates doubt the safety of Taco Bell. As one put it, the contamination of produce at the farm level has turned dining out into a crapshoot, and the lettuce-triggered outbreak of E. coli that sickened 71 Taco Bell customers was just a stroke of bad luck for a chain that apparently did nothing wrong.

But nor did it do right by airing the spots that feature Creed. There he appears in a unit, wearing a suit, assuring patrons that it’s safe to eat in Taco Bell restaurants again. As one colleague put it, the guy doesn’t look as if he’s eaten a taco in years. Another noted that she saw the spot in Atlanta, where fright levels were minimal to start because the outbreak hadn’t extend that far south. At best, the spots do no harm. At worst, they do no good.

The Yum! Brands-owned chain might have fared better if it’d heeded the advice of my wife, who views all major fast-food chains as the handiwork of Satan. Michael Jacobson of CSPI would blush at her vehemence.

But she may be onto something this time. If Taco Bell really wants to assure patrons that fears of a food-borne illness are ungrounded, then its executives should eat lunch and dinner in the once-contaminated stores for a week straight. The canaries who put themselves in the coal mine should include the units’ managers and regional directors.

And Creed should do the same. Ideally with his family. That would do a lot more to demonstrate confidence than the most aggressive television blitz.

Live from Indy, it's norovirus!

Welcome to Meet that Pathogen, the blog entry that introduces you to the viruses and bacteria making today’s headlines. And today’s focus is none other than that current page-one favorite, that star of radio, internet and health advisory alike, the veritable Tom Cruise of micro-organisms, the norovirus.

Currently making headlines for likely sickening 370 people who ate at an Olive Garden in the Indianapolis area, the bug has also been tagged the culprit for the 975-person outbreak linked to the famed Dinosaur restaurant in Syracuse, N.Y. Around the same time, it afflicted an Applebee’s in Michigan, where dozens of patrons were infected, forcing the restaurant to close. After the place reopened, more customers were stricken, pushing the toll of victims to 250 and forcing the outlet to shut again.

Despite that recent streak of damage, the virus is relatively unknown within the restaurant industry, where cries of “Food-borne illness!” usually signal outbreaks of E. coli, salmonella or listeria. Perhaps that’s because norovirus doesn’t have to be food-borne. Indeed, authorities say it’s much more likely to be passed from person-to-person, either through direct contract, or by touching surfaces like a bathroom doorknob. The Centers for Disease Control has reportedly looked at 11 norovirus outbreaks in New York State. Only two were the result of food being contaminated. Seven resulted from an infected person spreading the contagion, which is what authorities expect was the case at the Indianapolis-area Olive Garden.

But the germ has become as common as deck chairs in the cruise-ship industry. And, indeed, one of its many aliases is cruise-ship virus. It’s also well-known as the Norwalk virus, so named after Norwalk, Ohio, where it caused a highly publicized and extensive outbreak among grade-schoolers in 1968.

The symptoms it evokes have generated a list of names for the collection of ailments, including winter vomiting disease, stomach flu and the catch-all term food poisoning. The signs include vomiting, diarrhea, stomach pains, nausea, and fever is common, all of which typically pass in a matter of days.

Sanitation geeks usually wince and curse when they hear any of the bug’s names being used, not so much because of its effects on humans, but because it’s relatively difficult to eradicate. In Indianapolis, for instance, authorities reportedly told the unit’s managers to clean every hard surface with a bleach solution. The chain kept the store closed for two days to sanitize it.

This is a pathogen that, sadly, is likely to become more familiar to the foodservice industry as more outbreaks are logged. The industry perhaps has work to do in strengthening its defenses. In Indiana, officials are understandably speaking with the Olive Garden’s management about hand-washing policies. But they’re also discussing the outlet’s sick-leave policy, since three employees have tested positive for the virus.

Well, we’re out of time. Next on Meet the Pathogen: An interview with Listeria.

Word.

Taco Bell executives insist the chain’s outlets are completely safe again, but the kid-packed town of Port Washington, N.Y., apparently didn’t get the memo. A unit there, smack in the hot zone where dozens of Taco Bell patrons were sickened by E. coli in recent weeks, is usually a choice place to observe the current waistband heights and mating rituals of the skateboarding masses. But a visit during dinner tonight found the place completely empty. The only customer was an absolute imbecile who risked his health and his family’s well-being for the asinine reason of doing research for a blog that probably will be the death of him, unless he’s murdered first by his spouse, as one commentator put it. But I think my wife is starting to calm down.

Of course, it didn’t help my cause to parrot Taco Bell’s assertions that its outlets are safer than an Idaho mother’s milk, and that germ sniffers at the Centers for Disease Control and Prevention have adjudged the outbreak officially over. Her exact response: “And you believe those idiots?”

As I saw during my visit to our local Taco Bell, she is far, far from being the only person with that conviction. After reading about outbreaks involving spinach, tomatoes, Taco Bell, Applebee’s, Taco John’s, lettuce and Olive Garden, she’s written off the chain sector as the Chernobyl of the restaurant industry, with inherent dangers that only a Borat-caliber moron would brave for the sake of a chalupa. And the people safeguarding that noxious lot, she and others seem convinced, are as spin-doctor-y and smoke-spouting as the Moscow bureaucrats who tried to explain away the clouds that had cows in Belgium veritably glowing with radiation.

That skepticism came to mind as I was sitting in the Port Washington Taco Bell and watching the two persons on duty. They were cleaning when I came into the store; they stopped and washed their hands before one took my order and the other prepared it; and then they plunged back into their cleaning spree. The unit made a hospital O.R. seem like the men’s room at Penn Station.

Yet a crowd was at the Burger King next door, and the pair running the Taco Bell looked resigned to a shift that would pass with the speed of a kindergarten’s dance recital.

The industry has lost its credibility, yet it’s not doing enough to restore it. Sure, it’s looking at various ways it can prevent food-safety crises, and that’s a great thing. Taco Bell, for instance, said twice this week that it plans to lead the formation of a coalition that would set new safeguards for the industry’s supply chain. That ad hoc group would include competitors, regulators and suppliers, it said.

A noble gesture, indeed. And something that surely shows Taco Bell’s seriousness about averting catastrophes like the recent E. coli outbreaks. Except that a group very much like it already exists. It was formed this fall, around the time of the spinach-related E. coli outbreak, by the National Restaurant Association, with the express purpose of setting standards for produce. Why doesn’t Taco Bell know about that if it’s really serious about fostering safety on a macro level?

Indeed, the chain needs to watch what it says and does. I participated in the media conference that the chain hastily called on Monday night (it alerted the general media 26 minutes ahead of the start time, or about 5:34 in the evening). Taco Bell president Greg Creed was the featured presenter. But I kept expecting Rod Serling to butt in.

Creed gave the impression that extensive testing had found no traces of E. coli in any ingredients used by the Taco Bells in the four-state area of the outbreak. Then I asked him about white onions. Oh, yeah, testing did find some E. coli in those, but it wasn’t the same strain as the one that had made everyone sick, he said.

Ah, I see. It’s a completely different contamination. A flukey coincidence. But, um, what about that assertion that all ingredients are safe?

He also said that federal officials had identified lettuce, cheese and beef as the statistically probable causes of the outbreak. But since it couldn’t be beef or cheese—the former’s cooked, the latter’s pasteurized—lettuce had to be the culprit.

Well, if it couldn’t be cheese or beef, why did the Centers for Disease Control say those ingredients were also under suspicion? And why did Taco Bell throw out shipments of those foodstuffs from a particular supplier and then change vendors? Wasn’t it all safe by virtue of the processes that prompted Taco Bell to declare lettuce the “most probable” cause?

And it didn’t exactly calm fears when it stressed that it only used a small portion of the lettuce that was under suspicion. Creed emphasized that Taco Bell buys only 20 percent of the implicated vendor’s shredded lettuce, which meant that a lot of tainted greens could’ve been floating out in the market. Of course, that raises the likelihood that E. coli victims could have ingested the bug at other places, a significant finding when you’ve already been sued by two parties, with more lawsuits almost certain to follow.

If my one-unit mystery-shop was any indication, the chain is doing a great job of safeguarding the public (and, indeed, no one disputes that the problem was an ingredient shipped into the unit in a contaminated form, rather than any mistake the chain or its units might have made). But it needs to allay the concerns of folks like my wife. Because I'd like to get my stuffed burrito without a dessert of abuse. And that couple working at my local unit sure looked as if they'd appreciate the business.

Take this pitch and shove it

Covering food-borne illnesses for the last week hasn’t been pleasant, and not merely because the volume has been unparalleled (about 1,400 people sickened in at least five outbreaks involving five well-known restaurant operations). The unease is more a result of the yuck factor: Journalists have to eat, too, and we in the foodservice media probably do it more often in restaurants, including chain facilities, than your typical E.coli-averse person.

What increases the nausea are the walking chancre sores who see kidney failure and the hospitalization of kids as an opportunity to land some ink. Since news reports of the E.coli and norovirus situations first emerged, we’ve been besieged by parties who smell an opportunity. This one has a widget that certainly would have averted an E.coli outbreak like the one that hit Taco Bell. Curiously, Company B has a miracle-working gizmo that’s even better, and is willing to grant us an opportunity to learn why it outstrips everything offered by respectable suppliers with proven products.

More lawyers than you’d normally see behind an ambulance have called because they have some thoughts on E.coli-related litigation that would be great fodder for our stories, if not the basis for an article just on them. Translation: Write me up and maybe someone reading it might hire me to sue a restaurant chain on their behalf.

Ditto for insurance advisors, who merely want to explain in print how essential it is to have coverage against a food-safety catastrophe. It’ll all be totally generic, they assure us. It’s merely a coincidence that the form of coverage they recommend is exactly the sort their firm offers. Sorry, but I’m only taking calls from the Geico lizard from this point forward.

Then there are the consultants who know precisely what mistakes an afflicted chain made that resulted in the outbreaks, and want to enlighten our readers at absolutely no charge. Right. From their in-home study, they were able to determine sight-unseen what the likes of Taco Bell and Applebee’s were too dumb to realize. Never mind that some of the affected restaurants appear to be victims themselves, stung by produce that was likely contaminated when it was still in the ground.

They’re like plastic surgeons standing at the sight of a serious car crash, passing out business cards.

Actually, there’s a name for opportunists who feed on tragedy like that. Oh, gosh, what is it again? Oh, yeah, I remember now—maggots.

Like father, like son?

With the volume of executives who've moved from Dallas-based Brinker International to Phoenix-headquartered P.F. Chang’s, some industry wags have taken to calling the Asian-chain operator "Brinker West." From Chang’s CEO Rick Federico to president Bert Vivian and director Lane Cardwell, there have been enough defect-ees to wear a footpath between the casual-dining giants.

Now the overlap is spreading to a second generation. Yesterday, Chang’s named sports marketer Tim McDougall as its chief marketing officer. He earned that responsibility by heading the marketing operations of pro basketball’s New Orleans Hornets and Houston Rockets. But his new employer must hope he’s inherited some restaurant acumen, too. He’s the son of Ron McDougall, Brinker International’s former CEO.

Not coincidentally, the elder McDougall rose to that post through marketing, serving under Norman Brinker when both were at Pillsbury. Ron was Norm’s second in command throughout the formative years of Chili’s and their early subsidiary concepts, Macaroni Grill and On The Border.

Theirs is hardly the only family affair in foodservice. The Hislop family’s boys, Mike and Steve, both formerly oversaw chains (Il Fornaio and O’Charley’s, respectively). John Metz built a sizeable contract-management concern before becoming a T.G.I. Friday’s franchisee, and son John, Jr. is part of that business now, too, after opening some fine-dining restaurants in Atlanta. Former IHOP marketer Steve Pettise was followed into the business by his son, as was Rich Hohman, the late one-time chief of Country Kitchen. And, of course, there are the Marriott boys, Bill and Dick.

For an industry that supposedly dehumanizes people with the baseness of its work, foodservice certainly draws a lot of individuals who have plunged in after watching their parents or siblings toiling in the trade. They know exactly what that career track holds, and they chose the life nonetheless. Detractors call it a dead-end field, but clearly they're missing what people-in-the-know readily see. Why else would they follow in a close relative's footsteps?

Humans 0, Germs 1,189, Radioactivity favored

The war against dangerous microbes hasn’t been going well for the human side. Thirty-nine people were reportedly sickened by bacteria linked to New York-area Taco Bell restaurants, 900 were struck by a viral contamination traced to the famed Dinosaur barbecue outlet in Syracuse, N.Y., and at least 250 customers and employees of an Applebee’s in Michigan have been afflicted with the gastrointestinal maladies of a norovirus infection, which has yet to be contained there. And that’s all in the last few weeks.

There’s no consolation there even for the hardest-hearted competitors, since any place can be tarred with suspicions if one of its kind is implicated in an outbreak. Besides, who wants to best a rival in that fashion?

But from Great Britain comes an astounding indication that consumers may run hot or cold on being poisoned. A Polish restaurant in the city of Sheffield is doing killer business because of its name: The Polonium. That moniker was little more than a curiosity (it was the name of the properietor’s Polish folk band) until cold-war spy and Russian dissident Alexander Litvinenko was poisoned with polonium-210, a radioactive isotope. Since he died, and left a compelling mystery as to why he was poisoned and by whom, The Polonium has been enjoying an upsurge in business.

Ditto, reportedly, for outlets of the sushi chain whose London unit was where the polonium-210 may have been slipped into Litvinenko’s food. Traces of the radioactive material have been founded in that branch of Itsu, but it hasn’t kept customers away, according to British press reports.

Who’d have thought a poisoning could be a traffic generator?

'Yes, we can. Er, no we can't.'

Ronald McDonald should be redrafting his holiday gift list to put “walkie-talkies for all executives” smack at the top. Maybe then they’d say the same thing about McDonald’s readiness for New York City’s planned trans-fat restrictions, which are expected to be approved Tuesday.

Instead, the public pronouncements have shown little of the chain’s famous consistency. A few weeks ago, CEO Jim Skinner told a group of portfolio managers that McDonald’s would be ready to replace its partially hydrogenated fryer oil with a zero-trans-fat variety if the restriction on restaurants is adopted. His assurance was reported in a slew of news reports, including the lead story of a recent Nation’s Restaurant News.

Then, on Thursday, articles in The Chicago Tribune and The Wall Street Journal had the chain singing a much-different tune (“We’re not lovin’ it”?) Granted, that revised assessment came second-hand. Both papers said they’d been told by Peter Vallone Jr., a city councilman best known for being the son of a like-named political luminary, that McDonald’s would not be able to comply with the measure in its current form until June 2008. Yet the restriction on restaurants’ use of the artery clogger would be put in place a year earlier. The younger Vallone said he’d been given that message by a McDonald’s lobbyist, Patrick Thiesen.

Both publications tried to check the assertion with McDonald’s, but the company would neither confirm nor deny the reports. However, a spokesperson told the Journal that the chain would indeed be able to comply with the ban if it’s enacted.

Huh?

Clearly some spin-doctoring is being done here. But the proponents aren’t staying on message. Can McDonald’s comply or not? At other times, representatives have suggested that the chain couldn’t switch to a trans-fat-free oil at this point because the choices available would affect the taste of the famous McDonald’s French fries. Yet the Golden Arch-studded restaurants in Australia, among other places, have already made the switch.

Are we to believe that McDonald’s simultaneously a) can’t make the switch; b) actually can make the switch; c) would never sacrifice the taste of its fries; d) doesn’t have an oil ready that will preserve the current gold-standard taste of its signature side dish; e) will indeed make the change if required? All simultaneously? Even Hogwarts couldn’t deliver that sort of magic.

Ronald McDonald’s title is technically chief smile officer. But with that kind of hedging, he’s might be getting some memos from the top about excessive frowning.