Two restaurant companies change their names for different reasons. IFMA revises its 2024 forecast. Apparently, everything really is bigger in Texas: these stories and more This Week in Foodservice.

What’s in a name? Apparently plenty. Last week two restaurant companies decided to rename themselves. Multiconcept operator Focus Brands changed its name to GoTo Foods and fast-casual soup chain Zoup! changed its name to Z!EATS.

GoTo Foods is the parent company of such restaurant chains as Auntie Anne’s, Carvel, Cinnabon, Jamba, McAlister’s Deli, Moe’s Southwest Grill, and Schlotzsky’s. The name change signals GoTo Brands’ “continued transformation into a platform company as it embraces its brands’ reputations as go-to choices in the restaurant industry – for franchisees and customers,” per a company release. This dovetails with the company’s ongoing development efforts that center on multi-unit growth, co-branding and non-traditional units.

In the case of Zoup!’s name change to Z!EATS the transition aims to communicate the year-round nature of the chain’s menu. Most consumers generally associate soup with the winter months and the chain wants to break away from that and appeal to new audiences who are more focused on health consciousness and better-for-you concepts. Z! EATS, which is owned by multiconcept operator WOWorks, will shift the focus from soup, towards a wider variety of high-quality food options including flatbreads, mac and cheese, and soup flights.

The inaugural Z!EATS restaurant is scheduled to open in the Upper West Side of Atlanta this spring. By the end of 2024, all existing Zoup! locations will be revamped into Z!EATS, too.

Foodservice News

• Will a growing economy and low unemployment create a winning combination for the foodservice industry in 2024? The International Foodservice Manufacturers Association believes that to be the case. And that’s why IFMA has revised its projections for 2024, saying operator spending will increase 0.9% on a real basis this year. That’s slightly less than the 1.2% of real growth in operator spending in 2023, per IFMA data. Restaurant spending, including the full-service and limited-service segments, will grow by 0.6% in 2024. Collectively, on-site segments in 2024 are projected to grow 2%, largely because their recovery from 2020 was slower than that of restaurants. The college and university and lodging segments are expected to lead onsite growth at 3.0% and 2.8%. Looking ahead to 2025, IFMA projects operator spending will increase 1.3%.
• Chicago multiconcept operator Fifty/50 Group has acquired Korgen Hospitality, a restaurant consulting firm. As a result of this deal, the company has formed Fifty/50 Restaurant Consulting Group, which will serve all segments of the hospitality industry and other business segments. Fifty/50 Restaurant Group owns or manages 19 establishments in the Chicago market. Korgen Hospitality was founded in 2018 by hospitality industry veterans Ken McGarrie and Morgen Klepfer. Ken McGarrie is also the author of the Amazon best-seller “The Surprise Restaurant Manager.”
• The Hoshizaki Alliance entered into a “strategic partnership with Fogel Company,” a Guatemalan manufacturer of commercial refrigeration equipment, per a company release.
• The economy is taking its toll on Denny’s. In explaining why the chain shuttered 57 locations during its 2023 fiscal year a company spokesperson said that rising costs outpaced sales volume at many of the units that closed, per a FSR story. Denny’s said that a location used to have to generate about $1 million in annual sales to break even and stay open. That metric has jumped to $1.2 million.
• Could dynamic pricing be on the menus at Wendy’s? The company plans to test digital features like dynamic pricing in 2025, per a Nation’s Restaurant News story. Over the next two years, the company intends to invest $20 million in digital menu boards and enhancements that can help grow sales with upselling and merchandising.
• Broadline distributor US Foods plans to open five Chef’s Store locations during 2024. The new stores will be in Beaverton, Ore.; Hampton, Va.; Hickory, N.C.; Sandy Springs, Ga.; and Virginia Beach, Va. US Foods expects to open these locations during the second half of the year. The warehouse-format stores will offer an assortment of products from fresh produce, meat, dairy, and beverages to restaurant equipment, catering essentials, janitorial supplies and other restaurant essentials.
• Red Lobster is for sale but after losing $22 million last year, the chain’s owner does not expect to net a big price, per a Restaurant Business story. The chain lost $12.5 million in the fourth quarter alone. The company is preparing a bidding process for the 660-unit chain that could take three to four months.
• There’s an old cliché that says everything’s bigger in Texas and that’s starting to be the case with Texas Roadhouse. The average unit saw its revenue increase to $7.6 million in 2023 from $6.7 million the previous year, per a FSR story. To help serve the increased number of guests driving these sales increases, the chain is building bigger restaurants, which is in contrast to what the rest of the industry is doing.

Economic News

• The current economic environment continues to send mixed messages. Take, for example, The Conference Board’s Leading Economic Index, which declined 0.4% in January. This came on the heels of a 0.2% decline in December. And for the six-month period from July 2023 to January 2024 the LEI declined 3%. That six-month decline was less than the previous six months, though, where the LEI dipped by 4.1%. “While the declining LEI continues to signal headwinds to economic activity, for the first time in the past two years, six out of its ten components were positive contributors over the six-month period (ending in January 2024). As a result, the leading index currently does not signal a recession ahead. While no longer forecasting a recession in 2024, we do expect real GDP growth to slow to near zero percent over Q2 and Q3,” said Justyna Zabinska-La Monica, sr. manager of business cycle indicators at The Conference Board.
• Initial jobless claims declined 12,000 for a total of 201,000 for the week ending February 17, 2024, per the U.S. Department of Labor. Economists polled by Reuters had forecast 218,000 claims for the latest week, per a Yahoo! Finance story. The 4-week moving average was 215,250, a decrease of 3,500 from the previous week.
• Existing home sales increased 3.1% in January compared to the previous month, per data from the National Association of Realtors. Year-over-year, sales slipped 1.7% from January 2023. “While home sales remain sizably lower than a couple of years ago, January's monthly gain is the start of more supply and demand,” said NAR Chief Economist Lawrence Yun. “Listings were modestly higher, and home buyers are taking advantage of lower mortgage rates compared to late last year.”
• Sales of new single‐family houses in January 2024 increased 1.5% compared to the previous month, per data from U.S. Census Bureau and the Department of Housing and Urban Development. Sales in January 2024 were also 1.8% greater than the same month last year.