This Week In Foodservice

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


Which Restaurant Chains are the Most Innovative?

How many jobs did eating and drinking places add in March? Why is the Department of Energy’s proposed refrigeration standards getting a chilly response? Which Ohio-based manufacturer is updating its facilities? We answer these questions – and a lot more – This Week in Foodservice.

The concept of energy efficiency is more of a direction than a destination. In other words, it’s only natural for government organizations to continue to press businesses and consumers to become more environmentally friendly through new legislation, etc. But for that legislation to actually have the desired effect it has to be feasible and economically justifiable. And that’s why a group of six associations, including five from the foodservice industry, are pushing back on some of the U.S. Department of Energy’s (DOE) proposed energy-conservation standards for commercial refrigeration equipment.

The group advocating for a “no new standard” to DOE’s proposal via a letter to U.S. House and Senate leadership includes the Commercial Food Equipment Service Association, Foodservice Consultants Society International, Foodservice Equipment Distributors Association, Manufacturers’ Agents Association for the Foodservice Industry, North American Association of Food Equipment Manufacturers and National Automatic Merchandising Association (NAMA).

The Energy Policy and Conservation Act (EPCA) requires the DOE to evaluate proposed energy-efficiency standards for several categories, including CRE, every six years, per a NAFEM release. EPCA does not mandate the DOE impose new standards; rather the agency is to impose such standards only if they are technologically feasible and economically justified.

“The current proposal is neither,” said Charlie Souhrada, CFSP, NAFEM vice president of regulatory and technical affairs. “In fact, the results could be quite the opposite, negatively impacting jobs, energy efficiency and food safety.”

DOE’s proposed standards require energy reductions of 17% to 60% on top of those put in place just three years ago, per the release. Plus, many of the technology options DOE believes would achieve these reductions are already in use, not readily available, or untested.

DOE acknowledges that it may take customers more than 10, 75 and up to 93.9 years to reap energy-efficiency gains from the proposed standards, per the release. Given the longer ROI, it becomes ironic that the DOE’s proposed standards may increase energy consumption as foodservice operators could opt to keep older, less-efficient equipment operating, or may need to purchase two pieces of refrigeration equipment instead of one to have comparable storage space.

“Our industry supports and will continue to support, energy-efficiency regulations that are tethered to technological and economic reality. DOE’s proposed standards are neither,” concludes the joint stakeholder letter to the chair and ranking members of the Senate Committee on Energy & Natural Resources and the House Energy and Commerce Committee.

Foodservice News

  • A Florida-based convenience store plans to install robots at several locations, per a C-Store Dive story. Nine-unit chain Re-Up plans to use what it calls “robotic chefs” in its kitchens, coffee-making process and fresh juicing program.
  • Four restaurants are among the 50 most innovative companies in the U.S., per Brand Keys, a New York-based brand loyalty and engagement research firm. They are McDonald’s, Taco Bell, Chipotle and Jersey Mike’s Subs.
  • How about noshing on a plate of hashbrowns while your electric vehicle charges? That’s an option diners at two Waffle House locations will soon have. The restaurants are using funds from the National Electric Vehicle Infrastructure (NEVI) funding from the states’ transportation departments to install charging stations, per an FSR story.
  • Jersey Mike’s appears to be for sale. Multiple published reports indicate the sandwich chain has been in on-and-off conversations with private equity firm Blackstone as it seeks a sale worth $8 billion. Restaurant Dive rightfully points out that sandwich chains do garner significant sale value. For example, Roark agreed to buy Subway last year for $9.6 billion.
  • Chik-fil-A sales continue to take flight. The chain reported systemwide sales of $21.6 billion in 2023 on average annual unit volumes of $9.4 million, per Franchise Times. And it’s that second stat that really jumps off the page when compared to other quick-service restaurants. For example, McDonald’s has AUVs closer to $4 million. And Wendy’s and Taco Bell have AUVs closer to $2 million.
  • Was Panera the victim of a cyberattack? That may be the case, per a variety of published reports. Late last month the fast-casual chain’s entire digital presence was disabled for a brief period. Everything has reportedly been restored and the chain remains relatively quiet about the incident.
  • In what is the restaurant industry’s equivalent of the unveiling of the Academy Awards nominees, The James Beard Foundation announced its 2024 Awards class. This includes the 2024 Restaurant and Chef Award nominees and the honorees of the Leadership Awards, Humanitarian of the Year Award, and the Lifetime Achievement Award. The JBF will celebrate the winners at a June 10, 2024, ceremony taking place in Chicago.
  • A new Florida law requires third-party delivery firms to obtain the consent of restaurants before listing them, per a Restaurant Dive story. The delivery companies must also de-list a restaurant within 10 days of the establishment requesting this to happen. In addition, the bill requires delivery companies to provide restaurants a way to contact customers during the preparation of orders, during delivery and for up to two hours after the delivery operator picks up the order. The law takes effect July 1, 2025.
  • Nemco will add 40,000 square feet to its Hicksville, Ohio, manufacturing facility. The manufacturer of food preparation and warming equipment anticipates being able to move into this new space by the end of September.

Economic News

  • The U.S. economy added 303,000 jobs in March, and the unemployment rate changed little at 3.8%, per the U.S. Bureau of Labor Statistics. This far exceeds economists’ expectations, which had forecasted the economy to add 205,000 positions, per a CNN story. Eating and drinking places added a net 28,300 positions in March, per the National Restaurant Association.
  • Private sector employment increased by 184,000 jobs in March and annual pay was up 5.1% year-over-year, according to the March ADP National Employment Report. This represents the largest number of job gains in eight months, per various published reports. Leisure/hospitality added 63,000 positions, by far the most of any industry sector. Medium-sized businesses (those with 50 to 499 employees) added 93,000 positions, followed by large companies (more than 500 employees), which added 87,000 jobs. Small businesses (one to 49 employees) added 16,000 jobs.
  • S.-based employers announced 90,309 job cuts in March, per data from Challenger, Gray & Christmas, Inc. March’s cuts were up 7% from the cuts announced in February, and virtually the same as (0.7%) as the cuts announced in March 2023. It is the highest monthly total since 102,943 cuts occurred in January 2023. In the first quarter, companies announced plans to cut 257,254 jobs, down 5% from the same quarter last year. It is up 120% from the cuts which occurred in the final quarter of 2023. The Government announced 36,044 job eliminations in March, which was the largest category.
  • Initial jobless claims increased by 9,000 for a total of 221,000 for the week ending March 30, 2024, per the U.S. Department of Labor. The 4-week moving average was 214,250, an increase of 2,750 from the previous week.
  • The NFIB Small Business Optimism Index decreased by 0.9 a point in March to 88.5, the lowest level since December 2012. This is the 27th consecutive month below the 50-year average of 98. Inflation was the main issue, per a NFIB spokesperson, who added that “the labor market has only eased slightly.”
  • Economic activity in the services sector expanded in March, per the Services ISM Report On Business.  The Services PMI came in at 51.4%, which means it remains in expansion mode. Economists had projected the Services ISM to come in at 52.7%, per a Morningstar report. But it is 1.2 percentage points less than the previous month, which means the news was not all good.