This Week In Foodservice

The editorial team aggregates key industry information and provides brief analysis to help foodservice professionals navigate the data.


Census Bureau Makes Large Adjustment, Steak n’ Shake to Turn Over More Stores to Franchisees and New Store Designs for Two Chains

The U.S. Census Bureau reports retail sales every month; we share the results in this blog. This data comes with some limitations and cautions, including the fact that it’s subject to revision.

How impactful can the Census Bureau’s changes be? For the first 6 months of this year eating and drinking place sales were adjusted upward by $9 Billion.

Trying to find a way to put the revision in some sort of perspective, Chick-fil-A’s total sales for all of 2018 were $3 billion. According to the government, it is as if three restaurant operations the size of Chick-fil-A appeared in the U.S. on January 1.

And just last year the bureau added $20 billion to eating and drinking place sales. Ironically, this actually has a sort of a negative effect since 2018 sales were higher, sales for the first 6 months of this year rose 4.2 percent instead of 4.6 percent which was first reported.

The revision process is not limited to eating and drinking place sales. The Census Bureau increased sales for retail food stores by $6 billion in the first 6 months of this year.

Economic News This Week

Foodservice News This Week

  • Pizza Hut plans major changes. The pizza giant will temporarily close hundreds of full-service locations and convert them to takeout and delivery service only. Some will be remodeled, refranchised or rebuilt. Some will be rebuilt in new locations.
  • Steak ‘n Shake has temporarily closed 103 locations as of the end of June, per published reports. This is up from the 44 temporary closings reported in May. The closings are part of the chain’s plan to turn company-owned units over to franchisees. The costs are very attractive at first appearance, with franchisees paying just $10,000 plus 50 percent of the profits. But S&P Global Ratings predicts Steak n’ Shake’s operating results will deteriorate and it’s at heighted risk for a debt restructuring.
  • Potbelly Sandwich tests a new design in two Chicago area locations. The new restaurant concept will both save money and eliminate the current somewhat chaotic experience. Instead of following their sandwich down a line and leaning over a tall counter, customers will find workers at a cash register to take their order. There will be a menu board instead of the current scattered display. Sandwich makers will be behind a glass wall so customers can still watch.
  • Noodles & Company’s new restaurant design features a smaller footprint, pickup windows for digital orders and more efficient equipment packages. The chain will test new kitchen prototypes in the fourth quarter with a goal of rolling out the new design in early 2020.
  • Growth Chains: Biggby Coffee plans to expand from its current base of 239 locations to 1,400 in the next 10 years. This growth will come, in large part, through the use of compact, lower cost stores, including some modular units. Mooyah Burgers, Fries & Shakes will add about 10 restaurants in the Philadelphia area in the next 4 to 5 years. Kura Sushi USA plans to expand from its current 22 units with the $47 million raised by the Japanese-based chain’s recent USA initial public offering. CNBC reported plans for China by 3 major chains: Popeyes Louisiana Kitchen wants to have 1,500 restaurants in 10 years; McDonald’s wants to almost double its current number of Chinese units to hit 4,500 by 2022 and Starbucks plans to have 6,000 stores in China by 2022. Noodles & Company is confident enough to predict 5.0 percent unit growth in 2021 with a 7.0 percent growth rate in subsequent years. JINYA Ramen Bar, with 32 full-service locations currently, plans to have 100 restaurants by 2021 and 250 by 2024.
  • Comparable Store Sales Reports: Arcos Dorados up 14.2 percent, Bad Daddy Hamburgers down 0.7 percent, Carrols Restaurant Group up 0.1 percent, Del Frisco Restaurant Group (total up 0.5 percent, Double Eagle down 1.5 percent, Barcelona up 2.4 percent, Bartaco up 5.5 percent and Del Frisco Grille down 0.6 percent), Fiesta Restaurant Group (Pollo Tropical down 1.3 percent and Taco Cabana down 3.0 percent), Good Times Burgers up 2.8 percent. Jack in the Box (system up 2.7 percent, company owned up 2.8 percent and franchised up 2.7 percent), Noodles & Company (system up 4.6 percent, company owned up 4.8 percent and franchised up 3.7 percent), One Group Hospitality up 6.4 percent, Papa John’s (North America down 5.7 percent, company owned down 6.8 percent and franchised down 5.3 percent), Ruth’s Chris Steak House down 0.5 percent, and Wendy’s up 1.4 perccent.

For details and same-store sales of other chains, click here for the latest Green Sheet.