Are We There Yet?

"Operators are emerging from this unprecedented period in our country's economy smarter and more focused than ever."

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Joseph M. Carbonara, Editor in Chief
Joseph M. Carbonara, Editor in Chief
The winds of change continue to blow through the foodservice industry. But unlike the torrential winds that disruptively swept through the industry the past few years, causing a panic among countless players, it would seem that we're enjoying a gentle fall breeze. I say this because taking a quick look around it appears as if the industry is finally starting to brush the dust off itself and little by little is getting back to business.

It is encouraging to see that some restaurant chains have put the slower business period to good use by developing smaller, more efficient prototypes for their businesses. In this issue we highlight several good examples, including Quaker Steak and Lube's new Mini-Lube unit and Freshii's new kiosk prototype, which will allow the chain to gain footing in many new venues that it's traditional model might keep it from. Even Burger King continues to use a smaller prototype to fuel its expansion into non-traditional spaces, most recently opening a Whopper Bar in New York City's Times Square. It will be interesting to watch these operators roll out their new prototypes and monitor the ways in which these units support the concepts' brand promise.

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On a more local scale, the blocks that surround our Michigan Avenue offices here in downtown Chicago are showing signs of life. For example, one multi-concept operator is about to turn on the lights once again in a space that another restaurant left dark months ago. Instead of simply adding another unit from its existing portfolio of restaurants, this operator is choosing to test a new concept, one that expands significantly beyond its traditional lunch and dinner business into additional dayparts. In contrast, just up the street, another multi-concept operator soon plans to shutter its traditional French restaurant and renovate the space so the company can launch a new, more stylish contemporary French restaurant. While these examples hit close to home for me, I highly doubt that Chicago is the only place where these kinds of developments are taking place.

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Still, it is important not to confuse all of this positive activity with growth. For most companies, real sales growth is still a quarter or two away, as the most recent data provided by the MAFSI Business Barometer and the NRA Restaurant Performance Index reminds us.

The path back to prosperity will undoubtedly be a long and winding one marked with lots of potholes and pots of gold. Operators are emerging from this unprecedented period in our country's economy smarter and more focused than ever. They are more interested in driving unit economics, as Andy Simpson points out in his Consultant's Viewpoint article. And operators are demanding more from their supply chain partners when it comes to specifying and purchasing equipment, as contributing editor Amelia Levin points out in the article "Back to Basics: E&S Budgets for 2010 and Beyond".

Operators may be demanding more from their vendor partners but they also realize their businesses won't be able to handle the new economic realities of the day without being able to work collaboratively with the members of their supply chain. That was one of many lessons I learned by spending time with our 2010 DSR of the Year Mike Perrino of Edward Don & Company.

By continuing to be very honest and forthright with his customers, Perrino's steady and fundamentally sound approach is something that everyone in the industry — regardless of segment — should try to emulate as the foodservice community prepares for a return to growth mode
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