June 2011 Archives

As a result of softer same-store sales and traffic levels and an erosion of optimism among restaurant operators, the outlook for the restaurant industry softened in May. 

The National Restaurant Association’s Restaurant Performance Index (RPI) – a monthly composite index that tracks the health of and outlook for the U.S. restaurant industry – stood at 99.9 in May, down 1.0 percent from April’s level.  May represented the first time in six months that the RPI stood below 100, which signifies contraction in the index of key industry indicators.

“Like the economy as a whole, the restaurant industry’s recovery hit a speed bump in May, with same-store sales and traffic levels softening from recent months,” said Hudson Riehle, senior vice president of the Research and Knowledge Group for the Association.

Watch our latest industry update video, where the National Restaurant Association's SVP of the Research & Knowledge Group Hudson Riehle summarizes the May Restaurant Performance Index and highlights of positive economic indicators that bode well for the restaurant industry. 

For previous industry update videos, visit our Research & Insights section.

The National Restaurant Association is playing a key role in a new initiative to cut food courts' contributions to landfills.

The Sustainable Food Court Initiative is close to launching four pilot programs to research how the waste output of shopping mall and airport food courts can be reduced, explains Chris Moyer, project manager of the NRA’s Conserve sustainability program.

The NRA and its partners in the endeavors will attempt to deflect waste from landfills by identifying best practices for recycling and reducing packaging, particularly shipping materials used for menu ingredients.

The National Restaurant Association expressed concern and disappointment over the Federal Reserve's June 29 decision to cap the "swipe fees" that merchants pay for debit-card transactions at 21 cents per transaction. That's below the average 44 cents that merchants pay for debit charges today, but a significant increase over the 12-cent swipe-fee cap that the Federal Reserve proposed in December.

Visit www.restaurant.org/cardfees for more information.

With the July Fourth holiday right around the corner, many are preparing to celebrate the nation’s birthday at cook-outs and picnics. For those who want to share a great food experience without the hassle of shopping, cooking and cleaning up, restaurants provide great options for any outdoor dining event.

Anywhere food is served, it’s important to follow proper food safety procedures. Whether cooking at home or serving restaurant-prepared food at a backyard barbeque, following these basic food safety tips will help keep meals safe for you and your family and friends.

If you're among the thousands of restaurateurs who will add more teen employees this summer, here are a few reminders on the laws governing teen employment.

California's new food-handler training law takes effect this Friday. Are you ready?

The National Restaurant Association can help food handlers comply with the law through a special version of its ServSafe training program.

The law, enacted in September 2010, requires new and existing restaurant employees to show proof of food-safety training within 30 days, beginning July 1. The law is designed to ensure all restaurant employees receive a reasonable level of food safety training to reduce the potential for foodborne illness.

Food-centered reality-competitions are among the hottest shows on television these days, featuring everyone from established chefs, to up-and-coming industry stars, to home cooks. A major cable TV network is planning to add other restaurant industry employees to that roster.

Powderhouse Productions and the Discovery Channel are casting for a new series that will "highlight and celebrate the great American Worker," including several in the restaurant industry.

The production company says in its casting call: "We are on a mission to find the best of the best, and to bring some long overdue recognition to the workers that make this country so colorful and so great."

Professions to be highlighted in the competition include pizza maker, oyster shucker, valet parker, waiter/waitress, and butcher, among others.

If you or your employees want to throw your hats in the ring for a chance to compete for national honors on TV, submit an application online to Powderhouse Productions by Thursday, June 30. Visit the site for more information on rules and eligibility requirements.

The National Restaurant Association continues its work to end billions of dollars in taxpayer-funded subsidies for corn-based ethanol.

In a June 23 letter to Reps. Wally Herger (R-Calif.) and Joseph Crowley (D-N.Y.), the Association -- as part of a 35-organization coalition -- noted its support for the support of the Ethanol Subsidy Repeal Act. The coalition had sent a similar letter to Senate leaders before its June 16 vote to repeal a repeal a 45-cent per gallon tax credit to blend ethanol in gasoline and end a 54-cent per gallon tariff on imported ethanol.

The letter to the House leaders noted that conventional ethanol was due to receive about $6 billion in refundable tax credits this year. Continuing to subsidize oil companies to blend ethanol – which the Renewable Fuels Standard requires them to do – is wasteful and unnecessary, it said.

"The Ethanol Subsidy Repeal Act will save U.S. taxpayers several billion dollars this year and have almost no impact on ethanol production, jobs or prices," the letter noted. "We applaud your joint leadership on this issue and look forward to working together to save billions in wasted dollars."

The NRA believes subsidies for corn-based ethanol for fuel distort the market and divert resources away from the food supply, which affects food prices. Coupled with the tariff on imports, the subsidies result is a real-life impact restaurants’ bottom lines. Food costs are one of the most important line items for restaurants, representing about 33 cents of every dollar in restaurant sales.

Lincoln, Neb.-based Runza Restaurants was one of four finalists in a national food contest by Capitol Hill newspaper Roll Call. The 82-location company's Runza Sandwich was first runner-up. 

The finalists were honored Tuesday in Washington, D.C., at Chef Spike Mendelsohn’s We, the Pizza restaurant. The other finalists were Georgia peaches, Maine lobster and the Northern Mariana Islands’ coconut -- which was crowned the ultimate champion.

The National Restaurant Association sponsored the “Taste of America” online contest, which started with 64 foods. 

More restaurants are turning organic garbage into soil-enriching compost because of a steady rise in commercial decomposition sites. How does a restaurateur start down that cost-cutting route? The National Restaurant Association asked Al Rattie of the U.S. Composting Council for a quick primer.

Q. If my restaurant wanted to start composting, how would I find a commercial composting site? A. Post-consumer food waste composting is the last frontier in our industry. Food waste composting facilities are expanding in number, but are still very limited. Here's a good place to start.

Q. How can I line up a hauler to take my garbage to the site? A. Your best bet is to see whether your existing hauler can work with you. The composting site you choose also might be a good source of information for finding a suitable hauler.

Q. Once I have a hauler and a site, what’s next? A. You need to start by training staff on what can and can't be composted, and instill a culture of organic recycling. This must be supported by the appropriate infrastructure of labeled waste cans for organics, signage and ongoing monitoring and supervision. What can and can't be taken to a composting operation will be dictated by the composting permit. You might not be able to compost all of your organic waste.

Q. Will I have to make physical changes to my facility? A. You might need a separate Dumpster for the organics if you generate enough volume. This has been a real issue for supermarkets, for example, because they just didn't have room for another Dumpster. You might need in-restaurant small totes for the organic waste until employees can take it to the Dumpster.

Q. What financial impact am I likely to feel? A. You should reduce your disposal costs, depending on the composting facility's tipping fee. That will vary across the country. You will, however, incur additional costs for Dumpsters.

The National Restaurant Association's nutrition director offers healthy living suggestions in the June 22 edition of USA Today.

Dubost, a registered dietitian with a doctorate degree in food science, discusses the importance of eating breakfast.

"You feel better and have more energy," she tells the newspaper.

The National Restaurant Association weighed in this month as the Treasury Department and Internal Revenue Service sought preliminary feedback on the Patient Protection and Affordable Care Act's sections on "Employer Responsibility."

These PPACA provisions will in 2014 require employers of 50 or more full-time-equivalent employees to offer health care coverage to full-time employees.

Restaurant operators are putting recycled material to work in their operations. Three of four restaurant operators (72 percent) report using products made from recycled materials, according to a recent study conducted by the National Restaurant Association with support from Georgia-Pacific Professional.

Fifty-eight percent of operators said they bought hand towels made from recycled products, while 57 percent purchase napkins made from recycled materials. Of the restaurateurs who purchase recycled products, 64 percent buy recycled bags and 62 percent buy recycled facial or toilet tissue.

In addition, 51 percent of study participants reported purchasing food containers made from recycled materials, 30 percent purchased cash register tape made from recycled materials and 28 percent purchased recycled beverage trays.

Other recycled used in restaurants: office paper, cups, boxes, plastic utensils, glass bottles, plates, cans, trash bags, plastic bottles, straws, coffee filters and egg cartons.

Learn more about the restaurant industry’s recycling practices.

The National Restaurant Association's partnership with Health Dining was mentioned Sunday in a Los Angeles Times article about the San Diego company's founder, Anita Jones-Mueller.

The company helps restaurants identify healthful menu items and create nutritious options. Its partnership with the NRA helps restaurant chains comply with a federal law that requires some companies to post calories on menus and menu boards.

The NRA partnership also promotes the company's healthydiningfinder.com, which helps guests find restaurants with healthful menu items.

The NRA also partners with MenuCalc and Silliker to help restaurants analyze the nutrition content of menu items and comply with the menu-labeling law.

The National Restaurant Association Educational Foundation named Lynette McKee as its new executive director.

McKee, who spent more than 20 years in leadership positions at Checkers Restaurants, Dunkin’ Brands, Burger King, Metromedia Restaurant Group and other foodservice companies, will start July 5.

She will lead the NRAEF in enhancing the restaurant industry’s service to the public through education, community engagement and promoting career opportunities.

“Lynette’s two decades of experience and her outstanding reputation in the restaurant industry will be of great benefit as she leads our educational foundation in expanding our reach and impact,” said Dawn Sweeney, president and chief executive officer of the National Restaurant Association and NRAEF. “Lynette is joining our Educational Foundation at an exciting time as we seek to strengthen our ProStart program’s efforts to educate high school students in culinary and restaurant management skills, and in growing our supporting scholarship programs for higher education in foodservice.”

NRAEF Board Chair Carlton Curtis described McKee’s qualifications as extraordinary. “Her commitment to the future of our industry is inspirational,” he said. “All of us are tremendously excited about her taking on this great leadership role for our industry.”

The National Restaurant Association --- joined by the Council of State Restaurant Associations and the National Federation of Independent Business -- has filed suit against the Labor Department over the agency’s new tip-credit-notice regulation.

The DOL regulation significantly changes the notice that businesses must give tipped employees about the tip credit. The new rule took effect on May 5. The DOL gave restaurants no chance to comment on the new notice requirements -- and then gave employers only 30 days to comply.

Advances in sustainability know-how and technology can help restaurants cut operating costs regardless of how large their greening budget might be, experts stressed during a National Restaurant Association educational webinar on Wednesday.

Use images, experiences and conversations to make your fast casual brand stand out.

But first, figure out who you are, what you want to be and stick to it, says Husein Kitabwalla, president of Sodexo’s Retail Brands Group. Kitabwalla shared the story of the company's Jazzman's Café & Bakery and its journey to success last month at the National Restaurant Association Restaurant, Hotel-Motel Show.

 When Sodexo launched the fast casual concept in 1999, the Jazzman's team wanted to immerse guests in a total sensory experience by engaging their sense of taste, smell, sight, hearing and touch. The team chose to offer entertainment, specifically jazz.

Here are some of Kitabwalla’s suggestions for success:

1. When telling your concept's story, make it authentic. The more you can humanize it, the more your guests will engage – and share it. Jazzman's Café uses photos to show its coffee's journey from the field to the restaurant, as well as the people who grow, harvest and roast the beans.

2. Do things that will inspire guests and make a difference in people's lives. Jazzman's includes stories on its website about its restaurant's community service efforts. College student workers have visited farms that supply the company's coffee.

3. Partner with the right suppliers and products. Jazzman's serves only coffee that is organically grown in areas that maintain mountainous tree covers – to protect the environment and wildlife in coffee-growing regions. As a result, it received a "Bird Friendly" certification from the Smithsonian Migratory Bird Center because its coffee is 100 percent organically, shade-grown.

4. Create conversations. Jazzman's encourages guests to share their stories about what their local restaurants mean to them and how they support the restaurant's community service. Customers have created videos about what they do and uploaded them to Jazzman's YouTube channel. They also share stories at www.facebook.com/jazzmanscafe.

5. Leverage the conversation. When your brand becomes a conversation, you're on your way to success, Kitwabwalla says.

Fast casual operators reported a net increase in same-store sales for the eighth consecutive month in April, according to the National Restaurant Association’s Restaurant Industry Tracking Survey*.  Sixty-five percent of fast casual operators reported a same-store sales gain between April 2010 and April 2011, and 32 percent of operators reported a same-store sales decline.  In March, 54 percent of fast casual operators reported a same-store sales gain, and 22 percent reported a sales decline.

Fast casual operators are also optimistic that business conditions will continue to improve in the months ahead.  Fifty-seven percent of fast casual operators expect to have higher sales in six months (compared with the same period in the previous year), and just 14 percent expect their sales volume in six months to be lower than it was during the same period in the previous year. 

Fast casual operators are somewhat less bullish about the direction of the overall economy, though, with 38 percent expecting overall economic conditions to improve in six months and 22 percent expecting economic conditions to worsen during the next six months.

*The National Restaurant Association’s monthly Restaurant Industry Tracking Survey is a valuable benefit of membership.  By completing a brief confidential survey each month, all panelists receive exclusive access to the detailed survey results, broken out by industry segment, type of ownership, and state/region.  To become a Tracking Survey panelist, you can simply complete the survey online at: www.restaurant.org/research/survey/survey.htm

Source: National Restaurant Association, Restaurant Industry Tracking Survey

In his latest commentary, National Restaurant Association Chief Economist Bruce Grindy recaps the major economic indicators from the month of May.  While the restaurant industry continues to face challenges, it has consistently outshined the rest of the economy in recent months.     

With restaurant industry performance closely tied to the strength of the overall economy, it’s a good time to see if the recent economic softness is spilling over into the industry. To help sort out the latest trends, the following is a recap of a few economic indicators from May, and how the restaurant industry compares to the rest of the economy. 

A restaurant industry veteran and former chairman of the board of directors of the National Restaurant Association testified before a House Judiciary Subcommittee hearing on the importance of one federal E-Verify system -- instead of states mandating their own rules -- as established in the recently introduced “Legal Workforce Act.”

Savvy operators are using a variety of methods to inform customers of their recycling efforts, according to the National Restaurant Association’s new recycling study produced with support from Georgia-Pacific Professional.

About 50 million adults will dine at a restaurant this Sunday to celebrate Father's Day, the National Restaurant Association projects.

New NRA research shows that dinner will be the most popular meal time on Father's Day, with 67 percent of Father's Day diners saying they plan to go to a restaurant for dinner on June 19. Twenty-four percent plan to go out for lunch, 10 percent for brunch, and 11 percent for breakfast.

On choosing where to eat: Sixty percent of patrons said it'll be Dad's favorite restaurant, whether the restaurant has Father's Day specials or not. Fifteen percent will choose a kid-friendly restaurant, 13 percent plan to go to a restaurant Dad hasn't been to before, and 6 percent will choose based on Father's Day food and drink specials.

The research is based on a survey of 1,000 adults. Get more details here.

The National Restaurant Association has teamed up with other travel and hospitality groups to back reforms in the U.S. visa process, which will ultimately add jobs and boost business in U.S. restaurants.

Restaurant operators who use online marketing and loyalty programs properly can increase their customer traffic and sales significantly, even during a challenged economy, says Scott Shaw, founder and chief executive of Fishbowl Inc., an Alexandria, Va.-based firm specializing in automated guest marketing services management.

Shaw said proper implementation and management of online marketing programs could not only reach customers faster than traditional campaigns, but also result in a huge return on investment. He discussed the advantages and challenges involved during the recent National Restaurant Association Restaurant, Hotel-Motel Show in Chicago.

A year's work of focused efforts by restaurateurs nationwide helped lead to this month's legislative victory securing swipe-fee reform.

The sustainability options available today could help restaurateurs lower their per-store operating costs as they open stores again after years of forgoing expansion.

The sustainability movement was just gaining momentum when restaurant development was in full swing before the Great Recession. Experts agree that operators have whole new categories of green kitchen equipment available to them today, while the payback period has been shortened because of rising utility costs.

"If I were opening a restaurant, there are three things I would look at: Energy, water and waste,” says Jenni Bair, a LEED-accredited marketing manager for Hobart. Bair is a featured speaker at a June 15 NRA webinar on sustainability savings.

The Internal Revenue Service reminded small businesses last month of online resources to help them take advantage of certain tax benefits.

Restaurateurs hunting for ways to put more local and sustainable choices on their menus found a bounty of suggestions at the National Restaurant Association’s Restaurant, Hotel-Motel Show in Chicago. 

You did it! The Senate voted today to move forward on swipe-fee reforms for restaurants and other merchants.

We are thrilled to report that the National Restaurant Association and the nation's nearly 1 million restaurants today scored a major victory on behalf of America's restaurants and their customers in the fight for fair debit-card fees.

Thank you to all our members who called, wrote, e-mailed and met with your lawmakers on this issue. YOU MADE A DIFFERENCE.

The U.S. Senate voted this afternoon AGAINST delaying new reforms in debit-card swipe fees. Senators who wanted to postpone the rules, led by Sens. Jon Tester (D-Mont.) and Bob Corker (R-Tenn.) could get only 54 of the 60 votes they needed to halt the new reforms. Forty-five senators supported the NRA and our allies in our fight to move the reforms forward.

This means the Federal Reserve can quickly move forward with the reforms Congress ordered last summer -- reforms aimed at fixing a broken debit-fee market and making sure that the fees merchants pay are reasonable and proportional to what it actually costs to process debit-card transactions.

The Fed's new rule could dramatically scale back debit-card swipe fees for merchants. The rule is due to take effect July 21, although its final shape is not yet known. The NRA is monitoring this closely.

The card-fee fight is one of the toughest battles the NRA and its members have fought. We've teamed up with other merchants across the country for nearly a decade to bring an end to unfair merchant fees. Our fight pits America's small businesses and merchants against Visa, MasterCard and the big banks -- and today we made a major step forward in the continued fight for fair fees.

We encourage you to thank the 45 senators who stood up for us and kept the reforms moving forward. See how your senators voted here. A "NAY" vote (that is, a vote AGAINST delay) supported the National Restaurant Association's position.

As states wind down their 2011 legislative sessions, state restaurant associations are seeing stepped-up action on immigration bills.

Restaurants are expected to add 425,000 jobs this summer, boosting the industry's workforce 4.6 percent above March 2011 levels, the National Restaurant Association projects.

This is the industry's strongest summer employment projection since 2007.

It's week No. 4 for voting for America's favorite state foods. Is your state's specialty food still in the running?

Capitol Hill's CQ Roll Call is running "A Taste of America," a friendly competition sponsored by the National Restaurant Association. In its fourth week the 64-bracket list of state foods has been winnowed down to eight finalists.

Next week, a "Final Four" heads to the final judging, to be held June 21 at Spike Mendelsohn's We, The Pizza restaurant on Capitol Hill in Washington, D.C.

Voting on the eight remaining contestants is open until Friday, June 10, at 5 p.m. ET. Here are the final eight:

--SOUTH: Arizona (tamales) vs. Northern Marianas (coconut)
--MIDWEST: Indiana (pork tenderloin) vs. Nebraska (runza)
--NORTHEAST: Maine (lobster) vs. New York (chicken wings)
--SOUTHEAST: Texas (jalapenos) vs. Georgia (peaches)

Vote for your favorite here.

Florida last week raised its state minimum wage to $7.31 per hour and to $4.29 an hour for tipped employees.

Florida is one of several states that tie annual increases in their state wages to increases in the cost of living. The June 1 uptick in the wage came after a lawsuit challenged the way the state's Agency for Workforce Innovation had calculated the wage for 2011.

Get the NRA's full list of state minimum wage rates here (member login required).

The National Restaurant Association commends the federal government’s new MyPlate food icon to guide Americans in making healthful food choices.

“The National Restaurant Association applauds the work to create an icon that gives consumers a clearer idea of how to think of their everyday meal options," said Scott DeFife, the NRA's executive vice president of policy and government affairs. “Much like the upcoming national menu-labeling standard, the new food icon will be a useful resource to help inform all Americans’ food choices.”

DeFife represented the National Restaurant Association Thursday at USDA where First Lady Michelle Obama and Agriculture Secretary Tom Vilsack unveiled MyPlate.

Recent Commerce Department travel projections could mean could good news for the restaurant industry.

The agency recently announced that it expected international travel to the United States to grow significantly in the next five years. Visitor volume is expected to increase 7 percent and to reach 64 million visitors who stay at least one night in the United States.

Restaurants get 15 to 40 percent of their annual sales from travelers and visitors, according to National Restaurant Association research.

The Commerce Department anticipates international visitor volume to grow 6 percent to 8 percent annually between in the next five years. That would mean 89 million visitors by 2016, a 49 percent increase from 20101 -- and an additional 29 million visitors.
 
All world regions are forecast to grow over the period, with the greatest coming from Asia and Oceania. Countries with the largest forecasted growth are China (232 percent), South Korea (200 percent), Brazil (150 perecent), Russian Federation (139 percent) and India (94 percent).

Six countries are expected to account for three-fourths of the projected growth between 2010 through 2016. They are Canada, Mexico, South Korea, China, Brazil and the United Kingdom. The expected growth from Canada would be larger than visitor volume from other country in 2016 except Mexico.

The forecast takes into account growth that could result starting next year from the United States' new national marketing efforts through its Corporation for Travel Promotion. Tthe Travel Promotion Act of 2009 authorized the creation of the corporation to promote the United States as a premier travel destination to international travelers. The impact is expected to be minimal next year but progressively increase through 2016, the Commerce Department says.

The National Restaurant Association is part of the Discover America Partnership and worked to pass the Travel Promotion Act. The coalition brings together business and hospitality industry leaders to help make the United States more competitive in attracting visitors from around the globe.

The National Restaurant Association supports two new bills aimed at giving more small- and medium-sized businesses access to OSHA's voluntary protection program.

Reducing garbage expenses was a recurring topic at the recent NRA Show. The discussions reflected restaurateurs’ interest in embracing sustainability while cutting costs.

Here are some tips offered at various education sessions:

• Don’t buy trash contributions. The most effective and profitable way to reduce a restaurant’s garbage is to purchase only as much food as the place will sell, stressed the U.S. Environmental Protection Agency’s Chris Newman. If you don’t buy more than you need, you’ll have less waste for the trash. The importance of precisely forecasting sales also was underscored in education sessions that touched on rising commodity costs.

The move toward sustainability will succeed only if the restaurant industry educates the public about food, its nutritional value and importance, panelists said last week at International Foodservice Sustainability Symposium.

The panelists said the world’s food system must be overhauled to protect against food and water shortages in the next 50 years.

“The most important thing you can do is lead a world push for people to respect food,” said Julian Cribb, author of "The Coming Famine." “We have to re-educate our entire society to value and respect food; they have become so detached and take it for granted. We must teach them how to eat for health and sustainability.”

In the wake of the U.S. Supreme Court’s decision last week to uphold Arizona’s tough-on-employers immigration law, Congress and state legislatures are increasingly likely to look at ways to expand use of the federal E-Verify system.