The Restaurant Revitalization Plan is moving toward a conclusion. Sonic Drive-In stores had some unique abilities to deal with the pandemic. McDonald’s and its franchisees might meet in a courtroom over technology charges. These stories and more This Week in Foodservice.

The Restaurant Revitalization Fund is winding down after receiving more than 303,000 applications requesting $69 billion in funds. As of May 21, The Small Business Administration had approved funds for nearly 38,000 applicants and for more than $6 billion. Further, 57% of submitted applications came from women, veterans and economically disadvantaged business owners. These groups are the priority targets of the revitalization program.

While business operators have been encouraged to keep applying, as pointed out above, there have been requests for $69 billion, but $28.6 billion was the maximum amount specified in the bill. This doesn’t mean that Congress couldn’t be asked to appropriate more money for the program. In fact, it would probably be something of a surprise if restaurateurs don’t try to keep the program alive in some version.

Economic News This Week

• Initial jobless claims decreased 34,000 for a total of 444,000 for the week ending May 15. This represents the fewest number of initial claims since the week ending March 14, 2020. The 4-week moving average fell by 30,500 initial jobless claims to 504,000. It appears that the number of claims is finally falling in a consistent downward pattern.
• The Philadelphia Federal Reserve’s May Manufacturing Survey indicated manufacturing activity continued to grow in the bank’s region. Unfortunately, it grew at a significantly slower rate. The activity index dropped from 50.2 in April to 31.5 in May. The New Orders Index dropped from 36.0 to 32.5. The Shipments Index fell from 25.3 to 21.0. But the Unfilled Orders Index increased from 27.2 in April to 40.4 in May.
• The New York Federal Reserve’s Empire State Manufacturing Survey found business activity continued to “grow at a solid clip in May. General Business Conditions were down from 26.3 in April to 24.3 in May. Any reading greater than zero indicates growth. The index for New Orders rose from 26.9 in April to 28.9 in May. The Shipments Index increased by 0.2 points.
• April privately owned housing starts declined 9.5% from the March estimate but grew 67.3% from April 2020. Single family housing starts were 13.4% less than the March figure.
• The National Association of Realtors said existing home sales declined 2.7% in April from March. This marks the third consecutive month of sales declines. In contrast, from January to April sales grew 20% compared to the same period in 2020. And, sales are up double digits this April from the same month last year.
• The Bureau of Labor Statistics’ JOLT Report said job openings are at an all-time high — 8.1 million — as of the last business day in March. Hires were little changed at 6.0 million. Separations were little changed at 5.3 million. The number of quits was unchanged at 2.4 million. Layoffs and discharge rates hit an all-time low of 1.0%.

Foodservice News This Week

• Teenagers vs. mature employees – which ones are going to be most important to restaurants? Stories about hiring older workers appear frequently and given the shortage of restaurant employees, golden agers may be an important source of help for foodservice operators. The industry has always relied on teenagers as its primary source for help and that won’t change. A couple of decades ago at an industry conference, the CEO of a fast-food chain said he didn’t care how much money was spent on training or how much they were paid, 17-year-olds were never going to be efficient. His point was that the industry had to develop systems and equipment that even teenagers couldn’t screw up.
• What type of foodservice operation is designed to survive a pandemic? When you think about it, it’s not too complicated. The old-style drive-in is just about Image courtesy of Sonic Drive-Inperfect. Customers know how to use the ordering and service process, which is about as safe as it gets. Just give the servers face masks and drive-ins are ready to operate safely. And the CEO of Sonic Drive-In reports that is what happened in the real world. There was a tiny drop in Sonic’s sales in March 2020. By April last year Sonic’s sales were back to normal.
• IHOP’s fast-casual concept Flip’d will open its first location in New York City this summer. The broad menu includes pancake bowls, egg sandwiches, steak burgers, grab-and-go salads, and wraps. The store will feature kiosks for ordering and a designated to-go area for customers to easily pick up online orders. The company is considering sites in Kansas and Ohio for possible expansions of the concept.
• Franchisees may sue McDonald’s over past technology fees. A survey of 225 McD’s franchisees shows almost 75% favor legal action to the tune of $70 million for what McDonald’s said was technology fees. In December last year, McDonald’s corporate surprised its franchisees with an e-mail saying the company would begin billing the franchisees for $423 per month for what was called a lag from its previous payment structure.
• Picnic raised $16.3 million in series A funding. The pizza robot manufacturer says its equipment is capable of topping hundreds of pies an hour.
• CrossAmerica will acquire 106 c-stores from 7-Eleven. Most of the stores now operate under the Speedway brand. CrossAmerica will rebrand the stores as Joe’s Kwik Mart.
• Growth Chains: Chicken Salad Chick will open five restaurants in the Fort Myer’s – Naples area. Ruth’s Chris Steakhouse’s expects to open six company-owned restaurants by the end of 2022 and two franchised restaurants by the end of 2022.
• Comparable Store Sales Reports: Ruth’s Chris Steak House down 14.8%.

For details and same store sales of other chains, Please Click Here for the latest Green Sheet