LSR | KRG Hospitality

A bowl of ramen with beers in the background

September 19, 2023by David Klemt David Klemt No Comments

The Top-performing New Restaurant Type

The Top-performing New Restaurant Type

by David Klemt

According to a midyear Yelp report, one category of new restaurant is experiencing a surge in growth across the US unlike any other.

No, it’s not ramen, as the image above suggests. Instead, it’s pop-up restaurants.

We can trace the growth of this category, at least on the operator side, to cost. Sure, pop-ups were popular before 2020. However, they grew even more popular during the pandemic.

One can argue the life cycle of the pop-up is fad to trend to cost-saving adaptation to proliferation.

There are even those who transform shipping containers into mobile, pop-up restaurants and bars. With the right permits and hookups (water, electricity, etc.), an operator can test a new market or an entirely new concept before committing fully to a brick-and-mortar location.

In other words, the pop-up simply makes sense for our industry. This category of restaurant (or bar) clearly doesn’t cost anywhere as much as its permanent brick-and-mortar counterparts, for one. Secondly, a pop-up doesn’t (shouldn’t, anyway) require more than a skeleton crew. And thirdly, they do seem to enjoy pops in interest whenever they come to a new market or new address.

There are, of course, other benefits. However, the low(er) cost is the most attractive element for most operators.

Keep in mind that Double Chicken Please started life as a pop-up cocktail concept. In fact, DCP is the current Best Bar in North America according to the World’s 50 Best Bars.

Covering more than 10,000 miles and serving over 1,200 cocktails, the DCP pop-up toured the US for three years before finding a brick-and-mortar home. And what a home. The concept is now a jewel in New York’s Lower East Side F&B crown.

Top Restaurant Types by Opening

According to Yelp, the following restaurant categories are experiencing the most growth.

The numbers below represent the changes in business openings from April 2021 to March 2022 in comparison to April 2022 to March 2023.

Pop-ups: +105 percent
Ramen: +45 percent
Noodles: +40 percent
Tacos: +28 percent
Chicken shops: +28 percent
Food stands: +23 percent
Japanese: +20 percent
Breakfast and brunch: +20 percent
Sushi: +13 percent
Steakhouses: +9 percent

As the numbers above show, the growth of pop-ups far exceeds that of any of the other categories. In fact, they’re growing by nearly three times that of the second-place category, ramen restaurants.

Make a Pop-up Work for You

For a pop-up to work the concept must be realized fully. The brand and its story must be communicated clearly.

And while the menus can perhaps change more easily, signatures should be dialed in to generate buzz.

At KRG Hospitality, our view of pop-ups is a popular one. We think they’re excellent branding tools and are a viable way for new operators to test the waters.

However, we believe that a successful pop-up should be paired with a fully customized feasibility study and in-depth concept development. Both are core services offered by KRG Hospitality, and both are specialties that set us apart.

They may be mobile, they may feel niche and “temporary” or experimental, but they’re still a business.

A pop-up can only transform into a brick-and-mortar concept with a shot at longevity if the operator treats it as a roving proving ground.

Image: Diego Lozano on Unsplash

Tray with In N Out burgers and French fries

September 18, 2023by David Klemt David Klemt No Comments

FAST Act Fight Appears to be Over

FAST Act Fight Appears to be Over

by David Klemt

Well, that was fast: If recent reports are accurate—and it appears they are—the battle over the FAST Act has come to a close.

Rather than fight on the ballot, fast-food chain operators and labor groups have struck a deal. Per some reports, this puts a halt to a referendum battle that could have cost more than $100 million in campaign funds.

On its face, the deal is quite simple. AB 257, known as the Fast Food Accountability and Standards Recovery—or FAST Act—is dead. That is, dead save for one provision: the creation of the Fast Food Council will move forward.

The council will have a total of eleven members. Nine will have the power to vote, two will be non-voting members. The breakdown will be as follows:

two representatives of the fast-food restaurant industry (2);
two franchisees or restaurant owners (2);
two restaurant employees (2);
two advocates for fast-food restaurant employees (2);
member of the public who is not affiliated with either side (1, will serve as chair); and
members from the Department of Industrial Relations and the Governor’s Office of Business and Economic Development (2, non-voting)

Their first meeting is on the schedule for March 15.

In exchange, fast-food workers will see the minimum wage bump up to $20 per hour should they be in the employ of a fast-food chain with more than 60 locations throughout the US. That pay rise will come in April 2024.

When it comes to further pay rises, the council has two options:

An annual wage increase of 3.5 percent; or
An increase based on average changes to the consumer price index each year.

As one might expect, the rise will be whichever number is lower.

What was AB 257?

To summarize, FAST would’ve done the following:

Establishes the Fast Food Council, ten members appointed by the Governor, the Speaker of the Assembly, and the Senate Rules Committee. The council will operate until January 1, 2029.
Defines “the characteristics of a fast food restaurant.”
Gives the Fast Food Council the authority to set “minimum fast food restaurant employment standards, including standards on wages, working conditions, and training.”
Provides the council the power to “issue, amend, and repeal any other rules and regulations, as necessary.”
Allows the formation of a Local Fast Food Council by a county, or a city that has a population of more than 200,000.

Click here to review the bill’s text in its entirety.

Why is this Important?

It’s entirely possible that similar bills will pop up in other states in the coming years.

If this result is anything go by, such bills may be used by QSR operators and labor groups as negotiating tactics. The most recent news regarding the FAST Act should have the attention of both operators and hospitality workers. In California alone, the pay rise is expected to affect at least 500,000 workers.

However, there is one provision of the FAST Act that workers may find less than encouraging. The deal that has been struck kills a notable provision: fast-food operators, at least in California, won’t be held legally responsible for labor violations that occur in franchise locations.

Operators in other states should keep an eye out for similar bills, as should all hospitality professionals.

Image: Kenny Eliason on Unsplash

Black and white image of jack-o'-lantern with smoke coming of its eyes

August 28, 2023by David Klemt David Klemt No Comments

Pumpkin Spice Everything is Already Here

Pumpkin Spice Everything is Already Here

by David Klemt

In what perhaps is an attempt to encourage people to think of cooler autumnal temperatures, pumpkin spice is descending upon us earlier than ever before.

Operators who are finalizing their pumpkin spice menu items are basically already late to the party.

Luckily, it isn’t like the brands for which fall’s most infamous LTO flavor works are too far behind. A significant percentage of consumers are drawn to pumpkin spice menu items like trick or treaters to homes handing out full-size candy bars.

So, operators still have time to put the final touches on pumpkin spice menu items…but they’ll want to get a move on.

That’s exactly what restaurant chains did this year. Their pumpkin spice-flavored onslaught began with the start of this month.

Pumpkin Spice, Now a Summer Flavor?

Spirit Halloween stores. Christmas music. And now, it appears, Pumpkin Spice.

What do these three things have in common? Well, it seems like they’re making their debuts earlier and earlier each year.

When we think of summer and seasonality, I don’t think pumpkin or even baking spices enters into most people’s minds.

Unless, however, those people are in marketing and branding.

According to Restaurant Business, Krispy Kreme went all in on pumpkin spice on August 7. On that day, the chain unveiled four donuts and a number of beverages featuring pumpkin flavors.

Interestingly, the company’s global chief brand officer, Dave Skena, states that their pumpkin spice releases came one day earlier this year. Last year, they say, pumpkin spice arrived “significantly earlier than the year before.”

7-11 may have crossed the pumpkin spice dateline first this year. Dunkin’ is already offering pumpkin spice F&B items. And Starbucks, famous for their PSL LTO, is rumored to be launching their specialty menu this Thursday.

Given these August releases, can we expect a brand to attempt to get the jump on everyone else and launch pumpkin spice LTOs in July?

Consumer Cravings

Brands wouldn’t gamble on releasing their pumpkin spice LTOs in August if they didn’t think their decision would pay off.

Considering what Krispy Kreme’s Skena says about pumpkin spice’s August arrival, consumers have already spoken. Apparently, a significant percentage of people have an interest in fall flavors midway through summer.

Of course, there are a few considerations for independent operators in terms of seasonal releases. Rolling out new menus and menu items can be a costly endeavor. Pulling the plug on one revenue-generating seasonal menu or LTO in favor of significantly different items may be harmful to the bottom line.

One approach operators could take is to plan far enough ahead to pull the trigger on LTOs when 7-11, Dunkin’, or Starbucks launch theirs. In other words, be ready, but don’t jump the gun.

This also speaks to the importance of operators knowing their core guests and listening to feedback. Are front-of-house staff hearing murmurs from guests that they’re craving new flavors? Perhaps it could be lucrative to leverage that anticipation.

Image: Colton Sturgeon on Unsplash

Taco Bell Doritos Locos Taco and sauce packet

August 11, 2023by David Klemt David Klemt No Comments

Taco Bell Celebrates Taco Tuesday Win

Taco Bell Celebrates Taco Tuesday Win

by David Klemt

Taco Bell, fresh off their victory in petitioning for the cancellation of the “Taco Tuesday” mark, will open a $5 million taco tab on September 12.

There’s no arguing that over at least the past few years Taco Bell has become the master of LTOs and attention-grabbing, loyalty-strengthening, and headline-generating promotions.

This campaign further solidifies the brand’s status as king of the fast-food campaigns.

“Taco T**sday” to “Taco Tuesday”

It’s highly unlikely that consumers and operators alike are unaware of the company’s “Taco T**sday” ads. The campaign, while playful, put a spotlight on the fact that, until recently, “Taco Tuesday” was a registered trademark.

Rather than spend millions of dollars to fight Taco Bell, Taco John’s, who previously had the rights to the mark, opted to relinquish the rights to the mark. Taco Bell’s argument was that nobody should be permitted to mark a common phrase.

“We’ve always prided ourselves on being the home of Taco Tuesday, but paying millions of dollars to lawyers to defend our mark just doesn’t feel like the right thing to do,” said Jim Creel, Taco John’s CEO. “As we’ve said before, we’re lovers, not fighters, at Taco John’s. So in that spirit, we have decided to begin sharing Taco Tuesday with a pledge to contribute $100 per location in our system to restaurant employees with children who are battling a health crisis, death or natural disaster. And we’re challenging our litigious competitors and other taco-loving brands to join us in supporting the people who serve our favorite food to guests across the nation.”

In fact, Creel fired a shot across the bow at Taco Bell at other rivals. After announcing their pledge to CORE, the CEO challenged other brands that want to use “Taco Tuesday” to do the same. The result would be quite the donation, considering that Taco John’s operates 400 restaurants in 21 states and Taco Bell alone operates more than 7,200 in the US. Look overseas and that number jumps up by about 1,000 locations in 30 countries.

Taco John’s has reportedly made good on their pledge, donating $40,000 to CORE, Children of Restaurant Employees.

What’s in a Mark?

Fast-food chain Taco John’s trademarked the phrase back in 1989. However, back in 1984, a California-based restaurant, Tortilla Flats, registered the trademark. According to some sources, the mark lapsed and Taco John’s snapped it up. That said, Tortilla Flats has sued other California restaurants for using the phrase throughout the years.

Interestingly, Taco John’s only had rights to the mark in 49 states. The exception is New Jersey, where Gregory’s owns the trademark. In fact, anyone who visits their site (as of the publication of this article) will see the phrase “Home of the Original Taco Tuesday!” right at the top.

However, it may surprise some to learn that a celebrity who appeared in Taco Bell’s “Taco T**sday” ads attempted to trademark the phrase in 2019. That celebrity? None other than Lebron James.

Clearly, this seemingly simple two-word phrase is a valuable trademark. It’s also likely that plenty of restaurants across the US have been surreptitiously using the phrase to drive traffic to their venues on Tuesdays for years.

The fact that Lebron James showed interest in the trademark and Taco Bell likely spent millions of dollars in ad revenue to have Taco John’s mark canceled shows the value. Time will tell how many millions of dollars the phrase will be worth to Taco Bell and other restaurant brands across the US.

Taco Tab

Some will see Taco Bell’s campaign as a massive brand bullying a smaller rival. Others will agree that it’s unfair for anyone to own the rights to such a common phrase.

In terms of exposure, I think this battle will help Taco John’s experience further growth. Last year was a banner year for growth for the franchise, and the brand was seeing growth back in 2021 as well.

After doing some digging, I learned that seven Taco John’s locations are owned by corporate; the plan for 2023 is to go from 375 stores to 400; and another 20 to 25 locations are planned for 2024. Per the Taco John’s website, initial layout for a franchise is between $942,000 and $1.4 for a single unit. A single franchise location generates annual revenue of around $1.2 million, on average.

Regarding Taco Bell, the brand is celebrating their victory—framed as a victory for all restaurants—with another of their famous and effective LTOs. On August 15, August 22, August 29, and September 5, Taco Bell guests can score a free Doritos Locos Taco. But the big celebration comes on September 12.

For that upcoming Taco Tuesday, Taco Bell will open a $5 million tab with DoorDash across the United States, with the exception of New Jersey. Again, Gregory’s owns the rights to the “Taco Tuesday” mark in the Garden State.

On September 12, Taco Bell will cover a portion of orders placed through the third-party delivery app to participating restaurants that offer Mexican cuisine. This does help the fast-food titan make the case that they fought this battle not just for themselves but all foodservice brands that wish to use the phrase “Taco Tuesday” without fear of legal action.

For further information, read the official Taco Bell press release below.

TACO BELL WILL HELP PAY FOR YOUR TACO TUESDAY CELEBRATION — EVEN IF IT’S NOT AT TACO BELL

Irvine, Calif. (August 8, 2023) – To celebrate the liberation of the Taco Tuesday trademark registration in 49 states, and to support and spotlight restaurants who now have the right to freely use Taco Tuesday, Taco Bell has announced that on Tuesday, September 12, Taco Tuesday fans (nearly) everywhere* can celebrate Taco Tuesday (nearly) anywhere – and Taco Bell will help pay for it.

On Taco Tuesday, September 12, Taco Bell, in partnership with DoorDash, is opening a $5 million taco tab to cover a portion of taco fans’ orders from any participating vendor selling Mexican cuisine. Because now that Taco Tuesday is free* – your tacos should be, too.

Leading up to the September 12 celebration, all Taco Bell locations will be offering a free Doritos® Locos Taco every Tuesday, no purchase necessary, on 8/15, 8/22, 8/29 and 9/5**.

“Taco Tuesday belongs to all who make, sell, eat and celebrate tacos, and this Free-For-All will not only thank taco fans who supported the cause, but will also spotlight local restaurants and vendors who can now embrace Taco Tuesdays without fear of legal action,” said Taco Bell U.S. Chief Marketing Officer, Taylor Montgomery. “When tacos win, we all win. We all win when Taco John’s decides to release its trademark registration, we all win when taco vendors everywhere are free to join the movement, and we all win when taco fans can freely celebrate and support Taco Tuesdays at Taco Bell or anywhere else.”

The Road to Freeing Taco Tuesday

In May 2023, Taco Bell took a bold step on behalf of taco lovers nationwide by filing legal petitions to cancel the two Taco Tuesday trademark registrations. The aim was simple: to free the phrase for restaurants nationwide. The message was clear: Taco Tuesday belongs to everyone, from Taco Bell to Taco John’s to your favorite local taco spot.

In late July, Taco John’s courageously decided to abandon its Taco Tuesday trademark registration. Not only did Taco John’s act benefit thousands of businesses across 49 states by making the term Taco Tuesday more freely available, Taco John’s also made a meaningful donation to Children of Restaurant Employees (CORE) for $40,000, which the Taco Bell Foundation has matched.

Supporting The Taco Community

Taco Bell has also committed to donating $1 million in partnership with the Taco Bell Foundation to support young people who make, sell, eat and celebrate tacos. Donations made by Rounding Up at checkout on Tuesdays will be matched up to $1 million. These donations will continue to fund the Taco Bell Foundation’s Community Grants and the Live Más Scholarship for fans and team members.

*The Taco Tuesday trademark registration has been canceled in all states except New Jersey. Therefore, the DoorDash offer will be limited to the 49 states where Taco Tuesday has been freed.

**NO PURCHASE NECESSARY. Offer valid on Tuesdays 8/15, 8/22, 8/29, and 9/5 only during local store operating hours while supplies last. Limit one (1) regular Free Seasoned Beef Nacho Cheese Doritos®

Locos Tacos per person, per offer day, available at participating U.S. Taco Bell® locations only. Not available with delivery orders unless placed directly on the Taco Bell app (delivery fees, taxes and tip apply). App and web orders require inputting offer code and customer must add a DLT to their cart. Not valid with any other offer. No substitutions. No cash value. Void where prohibited. Terms: ta.co/terms.

About Taco Bell Corp.

For more information about Taco Bell, visit our website at www.TacoBell.com, our Newsroom at www.TacoBell.com/news or www.TacoBell.com/popular-links. You can also stay up to date on all things Taco Bell by following us on LinkedIn, TikTok, Twitter, Instagram, Facebook and subscribing to our YouTube channel.

Images: Taco Bell

July 10, 2023by David Klemt David Klemt No Comments

Seemingly Simple: The French Fry

Seemingly Simple: The French Fry

by David Klemt

We celebrate the humble French fry—at once a living legend and deceptively simple side—on Thursday, July 13, National French Fry Day.

Now, I know I tend to dive into the history, disputed or not, of a given item when a holiday comes around. However, that’s not the point of this article.

Of course, I could easily point out that this iconic item’s origins aren’t settled history. That Belgium claims ownership as of 1680. Or that Chile may have beaten Belgium by 61 years. And that France gets credit because the recipe for “modern” French fries appear in the cookbook La Cuisinière Républicaine from 1775. I’m not even going to get into the debacle that was 2003’s Freedom Fries…

Again, that’s not the point. Whether you call them French fried potatoes, French fries, fries, pomme frites, or chips, they’ve been around for anywhere from 400-plus to almost 250 years in some form.

And still they manage to confound many a cook.

We’ve all gotten an order of flaccid, cold, mushy or otherwise cheerless chips. And we’ve all managed to muscle down at least a handful of those dismal, forlorn fries, each soggy bite driving us deeper into despair.

Okay, that may be the tiniest bit dramatic. My point is, French fries are deceptively simple to get just right. And a subpar fry can—let’s face it, will—ruin a guest’s perception of a restaurant. They may return, but they’ll be apprehensive.

Fry Infatuation

If you thought maybe I’d try to create a portmanteau like “infrytuation,” I did think about it. But that would be far too silly, even for me. I wouldn’t even type such a thing out loud.

Anyway, we may not know the origin of fries or chips for a fact. But we do know that for the most part, people love a fry. Those who don’t, well, they’re not to be trusted. Should you come across such a person, grab a handful of fries—or the entire basket—and run away. You don’t need that kind of negativity in your life.

But why? Why do we love a fry?

Perhaps it’s the versatility. They complete many a limited-service restaurant or QSR meal. At this point, the “bag fry” is almost its own varietal.

They’re at home at a dive or neighborhood bar. But they’ll also step up and accompany a steak at a French bistro or steakhouse. Fish house, shack or upscale seafood restaurant? Please—fish and chips are a power couple comfortable in any environment.

Speaking of versatility, chips are also happy to indulge a chef or cook’s most debaucherous thoughts. A vessel to carry short rib, cheeses, and an array of seasonings? They’re down.

Of course, it’s likely that fry popularity comes down to comfort. A hit of salt, fat, heat, crispness, and creaminess? That’s at the bare minimum. Toss on some parmesan or pecorino romano and that hit of dopamine doubles, at least.

Chip Tips

One professional, personality, and purveyor who knows his way around a French fry is Chef Brian Duffy.

Indeed, he takes fries seriously. So seriously, in fact, that he has promoted Lamb Weston for several years. For the unfamiliar, America-based Lamb Weston is on of the biggest producers of French fries in the world.

One of their products, the Extra Crispy series of fries, retains crispness for 30 minutes.

Chef Duffy also understands the importance of fries. They can, as stated above, make or break a guest’s visit.

Additionally, as you can see in the Instagram post below, Chef Duffy certainly sees the humble fry as a blank canvas for experimentation.

View this post on Instagram

A post shared by Chef Brian Duffy (@chefbriduff)

Given his strongly held views on fries, I reached out for his thoughts. And, of course, Chef Duffy didn’t disappoint. If you want to master your fries, take the Duffified approach.

Make sure you’re following Chef on Instagram, Facebook, Twitter, and Pinterest. From knife skills to thoughts on seasonings and techniques, you’ll gain helpful culinary insights. Oh, and he’s funny, too.

Duffified Fries

Elevate your French fries. Realize that they’re not “just” a side dish and therefore an afterthought.

For many brands, their fry is a calling card. That “card” can either tempt people through your doors or warn them to stay away.

Are they seasoned well?

Fries are seasoned perfectly when seasoned within 3-5 seconds of being removed from the fryer. Create a fry seasoning that has a good salt-to-seasoning ratio. My Fry base is 1 cup sea salt, 1/8 cup fresh ground black pepper, 1/2 cup onion powder, 1/4 cup garlic powder, 1/8 cup dark chili powder.

Are they crispy?

A good quality fry holds its crispiness for 10 to 15 minutes, unless it’s designed with a coating like a Crispy on Delivery^™fry from Lamb Weston that can stay crispy for up to 30 minutes. There’s nothing worse that taking that first bite and having a cold, soggy fry.

Are they hot?

A hot fry has a creaminess in the center that enhances the ultimate experience of the fry. Having that crispy exterior and creamy interior ensures a perfect fry!

Hand-cut fries.

Let’s be real: They’re amazing within the first few minutes. But anything longer than that is a soggy fry, rarely cooked perfectly due to the labor involved and the variations between the type of potato, the time of the year, and the starch to sugar content. It’s just a super inconsistent product unless it’s a huge focus for your concept. I’d stay away.

What are your sauces?

Just ketchup? Just ranch? Make up a few new dipping sauces that will assist you in creating a fry program that isn’t just as a side. Three different fry cuts and three different sauces are now a $14 appetizer that will make people happy.

Choose a fry or a fry program that matches your concept!

Is it a wedge, a concertina, a waffle, a dipper or a steak…? Choose wisely because the wrong fry can take your menu from great to, “Well, that sucked.”

Takeaway

Speaking of featuring fries as a premium appetizer that justifies a premium price, Chef Duffy has a couple of ideas.

One, a fry board. We’ve seen cheese boards, meat boards, pretzel boards… Why not fries?

Sift through Instagram and you’ll also find a Chef Duffy take on build-your-own nacho fries.

View this post on Instagram

A post shared by Lamb Weston for Chefs (@lambweston4chefs)

Get creative. Don’t just have fries, engage your kitchen and have them build a fry program. Innovation draws people in and converts them to loyal, repeat guests while justifying premium pricing.

Image: Vincent Rivaud on Pexels

Disclaimer: Neither the author nor KRG Hospitality received compensation, monetary or otherwise, from Lamb Weston or any other entity in exchange for this post.

March 17, 2023by krghospitality krghospitality No Comments

KRG Hospitality now Serving Midwest Region

KRG Hospitality adds Midwest Region

KRG HOSPITALITY NOW SERVING MIDWEST REGION

Toronto-based hospitality industry consulting firm with offices throughout Canada and the USA now serving the Midwest through Chicago office.

CHICAGO, IL (March 17, 2023)—Today, KRG Hospitality announces the addition of the Midwest region of the US to their North American service area. The team will operate out of an office in Chicago, Illinois. However, the agency will serve Midwest markets outside of Chicago as well.

KRG is excited to announce their presence in the region and their ability to serve clients effectively. The agency will offer the full suite of their proven hospitality solutions, including: hourly consulting and coaching; complete feasibility studies, fully customized concept plans; in-depth, focused business plans; project support and management; food and/or drink menu development and consulting; and personalized F&B education.

“I was born in Chicago and first entered the hospitality industry in the Northwest Suburbs. I got my first taste of nightlife in Chicago’s incredible bar and nightclub scene,” says David Klemt, partner and director of business development of KRG Hospitality. “Those experiences shaped my entire hospitality career trajectory. It will be an honor to serve the great people of the Midwest and bring their hospitality visions to life.”

“2023 is turning into quite the growth year for KRG, with the addition of team members Kim Richardson and Jared Boller, and now an exciting new market,” says Doug Radkey, KRG Hospitality founder, president, and project manager. “We see great opportunity in the Midwest, not only in Chicago, but many of the surrounding regions. The food, beverage, and hotel scene is incredibly strong, and we’re open to the challenge of not only helping launch new hospitality brands but helping transform existing brands scale and be successful in the new era ahead.”

KRG is ready to work with clients of all experience levels in the Midwest. The consulting agency’s suite of solutions serve new operators looking to open their first concept and veterans seeking a rebrand or expansion. From independent pizzerias and QSRs to multi-unit regional chains and boutique hotels, and everything in between, the KRG team is eager to take client visions and transform them into brick-and-mortar realities.

To schedule an introductory call to learn how the KRG Hospitality team serves clients, please follow this link.

About KRG Hospitality

KRG Hospitality is a storied and respected agency with proven success over the past decade, delivering exceptional and award-winning concepts throughout a variety of markets found within Canada, the United States, and abroad since 2009. Specializing in startups, KRG is known for originality and innovation, rejecting cookie-cutter approaches to client projects. The agency provides clients with a clear framework tailored to their specific projects, helping to realize their vision for a scalable, sustainable, profitable, memorable, and consistent business. Learn more at KRGHospitality.com. Connect with KRG Hospitality and the Bar Hacks podcast on social: KRG Twitter, Bar Hacks Twitter, KRG Media Twitter, KRG LinkedIn.

Image: Tobias Brunner from Pixabay

December 27, 2022by David Klemt David Klemt No Comments

FAST Act Dealt Knockdown Blow

FAST Act Dealt Knockdown Blow

by David Klemt

A bill we think is one to watch, California’s Fast Food Accountability and Standards Recovery Act, may be on the ropes already.

Assembly Bill 257, known as the FAST Act, is “on hold” until 2024. So, while the Save Local Restaurants coalition and voters have yet to kill the bill, it may be out on its feet.

We reported two months ago that fast food chains were moving quickly to kill the FAST Act. It appears that the initial attack on AB-257 was successful.

That is, the chains and coalition got what they want: the ballot initiative vote has knocked down AB-257.

For those unfamiliar with the Save Local Restaurants Coalition, the following organizations are members: The National Restaurant Association (NRA), US Chamber of Commerce (USCC), and International Franchise Association (IFA). Further, fast-casual and QSR chain coalition members—including Starbucks, In N Out, McDonald’s, and Chipotle—threw nearly $13 million at the ballot measure that halted FAST.

What’s FAST?

To read AB-257, the FAST Act, in its entirety, click here.

In summary, FAST:

FAST does the following:

establishes the Fast Food Council, ten members appointed by the Governor, the Speaker of the Assembly, and the Senate Rules Committee. The council will operate until January 1, 2029;
defines “the characteristics of a fast food restaurant“;
gives the Fast Food Council the authority to set “minimum fast food restaurant employment standards, including standards on wages, working conditions, and training“;
provides the council the power to “issue, amend, and repeal any other rules and regulations, as necessary”; and
allows the formation of a Local Fast Food Council by a county, or a city that has a population of more than 200,000.

Voters effectively stopped California from implementing FAST until November 2024 at the earliest. (That is, if the California Secretary of State verifies that the referendum effort did indeed secure the required amount of signatures.)

Opposition

A statement from Save Local Restaurants reads, in part:

The quick-service restaurants targeted by the law – which include coffee shops, juice bars, pizzerias, delis, and salad shops – already operate on small, single-digit profit margins. These include more than 10,000 small businesses, including thousands of women- and minority-owned businesses.

If these restaurants are forced to absorb the costs, the result will be bad for workers and local communities. To survive, many restaurant owners will have no choice but to reduce worker hours or introduce automation. Some may choose to leave their communities entirely or go out of business.

As is often the case with overreaching California policies, this is likely only the beginning.

Additionally, the National Restaurant Association, a member of the coalition, has said the following:

The impacts of the FAST Act won’t be limited to quick service restaurants in California. The law allows the new regulating council to set a higher minimum wage for quick service restaurants. Independent restaurants will, however, be forced to increase their pay to match, so they can remain competitive when recruiting and retaining workforce.

Takeaway

We believe this bill is one to watch because similar efforts could spring up in other states. Also, just because the bill is on hold until 2024 in California doesn’t mean other states aren’t working on similar legislation right now.

Now, there are obviously two sides to consider. Opponents, as we see above, say FAST will raise prices, eliminate jobs, and hurt families.

Proponents believe FAST will protect the health, safety, and welfare of fast-food workers. Additionally, the Fast Food Council could increase the minimum wage for fast food workers above California’s $15.50 minimum (effective January 1, 2023).

We’ll keep an eye on FAST over the next couple of years. Perhaps the coalition can work with California on a bill that protects fast food workers and doesn’t hurt operators and the communities they serve.

At any rate, FAST is down but certainly not yet out.

Image: Johann Walter Bantz on Unsplash

December 26, 2022by David Klemt David Klemt No Comments

Canada’s Single-use Plastics Ban

How Canada’s Single-use Plastics Ban Affects Operators

by David Klemt

With a few exceptions, Canada’s ban on the manufacture, importation, and sale of single-use plastics is now officially in effect.

However, that doesn’t mean restaurant and bar operators need to worry about current inventories just yet. While the Single-use Plastics Prohibition Regulations are in effect, operators have a year to deplete their stocks.

SUPPR is a crucial element of Canada’s overall plan to combat pollution and reach a goal of zero plastic waste by 2030. The single-use plastics ban was announced in June of this year.

“We promised Canadians we would deliver a ban on single-use plastics. Today, that’s exactly what we’ve done,” said Minister of Environment and Climate Change Steven Guilbeault the day SUPPR was announced. “By the end of the year, you won’t be able to manufacture or import these harmful plastics. After that, businesses will begin offering the sustainable solutions Canadians want, whether that’s paper straws or reusable bags. With these new regulations, we’re taking a historic step forward in reducing plastic pollution, and keeping our communities and the places we love clean.

Now, six months later, it’s the law of the land.

What’s Banned?

Essentially, Canadian operators must evaluate everything they use for delivery and takeout or pickup. If any items are single-use plastic, they must be gone by December 2023.

Per SUPPR, the manufacture, importation, and sale of the following is prohibited:

Checkout bags designed to carry purchased goods from a business and typically given to a customer at the retail point of sale.
Cutlery includes:
- knives
- forks
- spoons
- sporks
- chopsticks
Foodservice ware designed for serving or transporting food or beverage that is ready to be consumed, and that:
- contains
  - expanded polystyrene foam
  - extruded polystyrene foam
  - polyvinyl chloride
  - carbon black
  - an oxo-degradable plastic
- are limited to the following items
  - clamshell containers
  - lidded containers
  - boxes
  - cups
  - plates
  - bowls

Ring carriers are flexible and designed to surround beverage containers in order to carry them together.
Stir sticks designed to stir or mix beverages, or to prevent a beverage from spilling from the lid of its container.
Straws include:
- straight drinking straws, and
- flexible straws, which have a corrugated section that allows the straw to bend, packaged with beverage containers (juice boxes and pouches)

For accuracy, the above comes from the Government of Canada website directly, unedited.

What does this mean for Operators?

Again, operators in Canada don’t need to toss their current stock of the above items.

However, Restaurants Canada does recommend that operators contact suppliers and customers if they import, export, or sell prohibited items currently.

The single most important thing for operators to do now is research single-use plastic alternatives. Items need testing as changes will affect F&B items and the guest experience.

Of course, it’s possible an operator’s current supplier already offers alternatives to single-use plastics. That could prove convenient but costs, supply chain reliability, and impact on menu items need careful consideration.

Sustainability and responsible practices are no longer just conversation topics within the industry. As of this week, in Canada, they’re the only way forward.

Image: Volodymyr Hryshchenko on Unsplash

November 9, 2022by krghospitality krghospitality No Comments

2023: Year of the POS Systems?

2023: Year of the POS Systems?

by David Klemt

Image from SpotOn press release

According to SpotOn, the industry could be in for a tech revolution next year as independent operators pursue more powerful POS solutions.

The results of a survey conducted by the cloud-based POS platform are rather revealing. In an effort to better understand where the industry is heading, SpotOn surveyed 300 independent and small-chain restaurant operators.

Both full-service and limited-service (LSR) concept operators participated in this SpotOn survey. Intended to identify the challenges operators face currently, the results reveal much more.

Below, the picture these survey results paint for the industry.

Legacy vs. Innovation

This isn’t the first time I’ve stated the following: Our industry hasn’t been the fastest to implement new technology.

However, we did appear to turn that around in 2021. Now, heading into 2023, our industry may be pursuing cutting-edge tech solutions even more fervently. Today’s guest expects more tech, and your team likely wants access to more modern tech that makes their jobs easier.

Per SpotOn’s survey, 81 percent of independent operators still use so-called “legacy” POS systems. These are “traditional” systems from companies that have been around for quite some time.

It’s not difficult to understand why the vast majority of independent operators continue using legacy systems:

Investing in a new platform requires expenditures of money and time.
Introducing a new POS platform requires staff training.
Staff need to grow adept at using the new system.
It can be daunting to research the available platforms and implementing change.

So, independent and small-chain operators have a choice to make: Stick with the familiar or invest in the future. Change can not only be intimidating, it can be expensive.

However, it seems that most operators are ready to throw comfort to the wayside and embrace innovation.

State-of-the-art Benefits

Should the SpotOn survey prove to be accurate snapshot of the industry, 75 percent of operators will implement new tech next year. According to SpotOn, this is largely in response to growing labor challenges, such as scheduling and retention.

The restaurant, bar, nightclub, and food truck platform found that operators are spending as much as 20 hours per week on administrative tasks. State-of-the-art POS systems can slash those hours by:

streamlining operations;
making scheduling simpler;
calculating tips and payout for payroll; and
managing overtime, an increasingly common task.

More modern POS platforms can automate labor management tasks, saving operators time, money, and frustration. Automation and streamlining give operators something invaluable: time.

In particular, innovative and helpful tech solutions provide an operator with time to focus on growing their business. When weighing whether to keep a familiar but less feature-rich POS system or invest in a modern platform that seamlessly integrates many solutions, ask yourself a couple important questions:

What’s my time worth?
What am I focusing on every day?
Am I growing my business or stagnating?
Is my current POS system helping or hindering my team?
Does my POS system streamline and automate any tasks?

Image: SpotOn