This Week In Foodservice

Jerry Stiegler aggregates key industry information and provides brief analysis to help foodservice professionals navigate the data.

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Labor Woes Take a Bite out of one Restaurant’s Thanksgiving

Boston Market was forced to cancel holiday orders at one location. Some restaurants may pause delivery during peak periods. Meet Denny’s newest “associate” Janet. Panera opens a dual drive-thru unit. These stories and more This Week in Foodservice.

Consumer confidence dipped to a nine-month low in November, per the latest data from the Conference Board. The Consumer Confidence Index dipped to 109.5 in November after increasing to 111.6 in October. The Present Situation Index fell to 142.5 from 145.5 last month. The Expectations Index fell to 87.6 from 89.0.

“Expectations about short-term growth prospects ticked up, but job and income prospects ticked down. Concerns about rising prices — and, to a lesser degree, the delta variant — were the primary drivers of the slight decline in confidence,” says Lynn Franco, senior director of economic indicators at The Conference Board. “Meanwhile, the proportion of consumers planning to purchase homes, automobiles, and major appliances over the next six months decreased.”

What does this mean for consumer spending during the holiday season? “The Conference Board expects this to be a good holiday season for retailers and confidence levels suggest the economic expansion will continue into early 2022,” Franco adds. “However, both confidence and spending will likely face headwinds from rising prices and a potential resurgence of COVID-19 in the coming months.”

Economic News This Week

  • Initial jobless claims totaled 199,000 for the week ending Nov. 20, 2021, per the S. Department of Labor. This marks a decline of 71,000 claims from the previous week. It is also the lowest level for initial claims since Nov. 15, 1969, when it was 197,000. The 4-week moving average was 252,250, a decrease of 21,000 from the previous week. This represents the lowest level for the 4-week moving average since March 14, 2020, when it was 225,500.
  • Sales of new single‐family homes totaled 745,000 in October 2021, per data from the S. Census Bureau and the Department of Housing and Urban Development. This is 0.4% greater than the revised September rate of 742,000 but is 23.1% less than the October 2020 estimate of 969,000.
  • Black Friday traffic at retail stores dropped 28.3% compared with 2019 levels, according to preliminary data from Sensormatic Solutions reported by CNBC. In contrast, traffic was up 47.5% compared with year-ago levels. Online, retailers rang up $8.9 billion in sales on Black Friday, down from the record of about $9 billion spent on the Friday after Thanksgiving a year earlier, according to data from Adobe Analytics.

Restaurant News This Week

  • “No employees showing up today! We are unable to fill the orders! We are sorry!” That was the sign that greeted customers who visited a Boston Market location in Rancho Cucamonga, Calif., on Thanksgiving Day. Many customers had pre-ordered and prepaid for their holiday meals. Some guests report the restaurant did not contact them to let them know their food would not be ready. Some reported being able to see food sitting in the store but they had no way to access it. Boston Market is contacting the customers affected by this situation, offering them refunds and vouchers for future meals, per a published report. This unfortunate situation really drives home how dire the labor situation is for restaurant operators.
  • Denny’s is the latest restaurant chain to turn to robotics to potentially offset labor woes. The family dining concept made all sorts of social media waves over Thanksgiving when its latest employee — a robot named Janet — reported for work and began serving breakfast, etc. Another restaurant chain accelerating its exploration of robotics is Saladworks, which is working with a manufacturer of a salad-making unit. Other operators that could be ripe for robotics include coffee concepts, smoothies and more. Restaurant Dive provides a running list of chains testing robotic options.
  • Some restaurants plan to hit pause on delivery and online sales during peak periods due to ongoing labor challenges, the Wall Street Journal For many restaurant operators, online and delivery customers are often less profitable than customers who choose to dine on-site. Also, delivery and online orders often converge onto restaurants as dine-in customers walk through the front door, operators say, further stretching the already thin staff.
  • Panera opened its first restaurant featuring a dual drive-thru. The Baldwin, Mo., location highlights the iconic fast-casual brand’s approach to a restaurant world where more meals are consumed off-premises. While the new design maintains Panera’s signature fireplace, it does include updates to facilitate a more digital experience for customers. Panera had previously unveiled this design back in May 2021. In August of this year, Panera Bread joined with sibling concepts Caribou Coffee and Einstein Brothers Bagels to form Panera Brands to “turbo charge” growth. And in November Panera Brands announced its plans to go public.
  • Mod Pizza plans to go public. The company filed the necessary paperwork with the SEC. The move comes after the company opened its 500th location and saw systemwide sales decrease 5%. Back in 2019 the company raised $160 million to help fuel its growth and reach Mod’s goal of having 1,000 units systemwide by 2024.
  • Italian oven manufacturer Unox has begun construction on an assembly plant in Denver, N.C. Unox expects the new location to begin operations in the first quarter of 2023. The company plans to still make most of its parts in Italy for the time being, but the plan is to bring “substantial stock to the Americas to be housed in the North Carolina assembly plant.”
  • Ghost kitchen company Kitchen United opened its third New York City location. This comes shortly after Kitchen United acquired software and ghost kitchen developer Zuul. The acquisition saw Zuul’s existing locations in the Soho and Hudson Yards neighborhoods rebranded as a Kitchen United MIX kitchen center last month. The newest ghost kitchen center has approximately 6,400 square feet at ground level and will feature national, regional and local restaurant operators on opening day, including Wingstop, Jersey Mike’s Subs, Chili’s, Burger Village, Han Dynasty, Hawaiian Bros, and Café Habana, with more partners to be announced.
  • Growth Chains: Fast-casual chain MOOYAH Burgers, Fries & Shakes plans to add 54 units across its home state of Texas by 2030. At the moment 23 of the chain’s 90 units operate in the Lone Star State. Papa John's International plans to expand into Sub-Saharan Africa with franchise partner Kitchen Express LTD, a subsidiary of AAH Limited, the majority shareholder of Hass Petroleum Group, which holds a significant retail footprint in Africa. Kitchen Express LTD plans to open 60 restaurants in Kenya and Uganda, with 4 of these restaurants planned to open in 2022, beginning in Nairobi. Roy Rogers Restaurants opened a location on the University of Maryland campus. Located in the Stamp Student Union food court, Roy Rogers will serve its full menu appealing across multiple dayparts from this location.