Foodservice Equipment Reports Fortnightly

Welcome to FER Fortnightly Online Newsletter
April 6, 2010

Economic Report:
Sponsored by:
Henny Penny
Restaurateurs' Expectations Rise Sharply As Current Capital Expenditure Marker Hits Record Low
Consumer Spending At Restaurants Fell In 2009, Says NPD, As Overall Traffic Fell 4%
Even Big Chains Struggled Last Year, Technomic Reports In Its Annual Top 500
Wholesale Food Prices Rise Again, While Menu-Price Increases Are At 50-Year Low
Confidence Measures Show Consumers Remain Wary

Regulatory Report:
Sponsored by:
Manitowoc Foodservice
Iowa Decides Against 82-Year Old Cooking Practice
Scottsdale Ponders Disposer Ban
Healthcare Bill Makes Menu Labeling Mandatory
Senate Committee Proposes Equipment Assistance
Feds Shutter Whale Meat Sushi Store

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In This Section:
ITW Marks Third Year As Energy Star Honoree
Brinker Selling On The Border
Beijing, Dubai Add Fatburger Stores
Darden Designing Eight LEED-Based Units
Moe's Southwest Will Add 50 Stores, Expand To Turkey
Red Mango Prepares For Airport Landings
AHF Debuts First Regional Chapters
L.A. Food-Truck Chain Plans Franchising

This issue's Economic ReportSponsor: Henny Penny
Regulatory ReportSponsor: Manitowoc Foodservice

Industry Report Server Products

ITW Marks Third Year As Energy Star Honoree
For a third consecutive year, ITW Food Equipment Group?North America has been honored with an Energy Star Sustained Excellence award. According to the Environmental Protection Agency, which sponsors the awards, ITW is being honored for its long-term commitment to energy efficiency. ITW has been an Energy Star partner since 2008. It offers 455 Energy Star-qualified models among its different brands. Hobart, Traulsen, Stero, Vulcan, Wittco and Wolf are among ITW's independent companies supporting sustainable initiatives with new products and technologies directly addressing operations and the environment.


Section sponsored by Server Products

Brinker Selling On The Border
On The Border Mexican Grill & Cantina is on the way to new ownership. Brinker Int'l. has entered into a purchase agreement to sell the 160-unit brand to OTB Acquisition LLC, an affiliate of Golden Gate Capital. The transaction is expected to close by the end of the year, and Brinker plans to provide transitional corporate support to the company through the end of 2011.

Golden Gate, a San Francisco-based private equity firm, purchased Romano's Macaroni Grill from Brinker in December '08. Brinker will retain a 19.9% minority interest in the 189-unit Italian chain. Dallas-based Brinker also owns, operates and franchises nearly 1,500 Chili's Grill & Bar and 45 Maggiano's Little Italy restaurants.

Section sponsored by Server Products

Beijing, Dubai Add Fatburger Stores
Fatburger is betting on global growth. In March, the 55-year-old chain unveiled a new location in Beijing and opened a second unit in Dubai. The Beijing store is Fatburger's third store in China, and its first on the mainland; it already has units in Macau and Hong Kong.

The Los Angeles-based company plans to open six more restaurants in China over the next few years. Fatburger has 16 locations outside the United States, in Canada, the Middle East, and Asia Pacific. It plans to open more than 40 more International locations during the next several years.

The Dubai store marks the second venture with franchisee Khalil Asfour of Vetra Investments. Fatburger opened it first Dubai store in 2008 at the base of the Burj Khalifa, the world's tallest building, which was then under construction. The new outlet is on Jumeriah Beach Road.

Section sponsored by Server Products

Darden Designing Eight LEED-Based Units
The first in a series of new Olive Garden restaurants opened in Jonesboro, Ark., in January. The unit marks the first step in Darden Restaurants' systemwide sustainable-restaurant design initiative.

The plan incorporates the use of Leadership in Energy and Environmental Design standards in Darden's design process for all new restaurants and, where feasible, store remodels. The company is designing eight stores to meet LEED standards. Another Olive Garden and two Red Lobsters are scheduled to open this year, followed by one Olive Garden, two Red Lobsters and one LongHorn Steakhouse in 2011.

"Our goal with this initiative is to utilize each of the eight restaurants as a learning lab," said Suk Singh, sr. v.p. and president of development. "While we may not seek LEED certification for every restaurant we build or remodel, we can make a positive impact by learning from the eight restaurants where we are seeking LEED certification and applying best practices across our entire portfolio."

The Jonesboro store features a number of sustainable design elements, including recycled building materials, increased natural light, Energy Star-rated equipment, and low-flow water nozzles.

Notably, the store reclaims heat expelled from the HVAC and the freezer/refrigeration condensing units to supplement water heating in the kitchen.

Darden's new corporate headquarters facility in Orlando on track to earn LEED Gold certification from the U.S. Green Building Council. The building is the largest LEED Gold new construction project in the state of Florida.

Darden owns and operates 1,800 restaurants under six banners: Red Lobster, Olive Garden, LongHorn Steakhouse, The Capital Grille, Bahama Breeze and Seasons 52.

Section sponsored by Server Products

Moe's Southwest Will Add 50 Stores, Expand To Turkey
For Moe's Southwest Grill, the focus is on Turkey. The company says it will add 50 locations this year and expand into Turkey, adding 40 stores there over a seven-year span. The first of the Turkey locations will open in Istanbul's Sapphire Tower in September.

Mike Shattuck, president of parent company Focus Brands Int'l., told Bloomberg News the company will sell more franchise agreements in the first quarter of 2010 than it did in all of 2009.

Moe's will close 33 franchise deals in the first quarter after signing 22 in all of '09. The chain recently signed a deal with foodservice developer Sodexo USA to open 50 stores in universities, train stations and medical centers within five years.

Moe's operates 409 locations in 34 states and Canada. Focus Brands also owns Carvel Ice Cream and Cinnabon. It has more than 2,200 outlets worldwide, and plans to double that count within five years, Shattuck said.

Section sponsored by Server Products

Red Mango Prepares For Airport Landings
Red Mango, the Dallas-based frozen-yogurt purveyor, claimed record franchise development in 2009, signing 42 franchisees to open 219 locations. Now it has awarded a license agreement to airport concession operator The Grove for Red Mango operations to open at Dallas/Fort Worth Int'l., Chicago O'Hare, Newark Liberty Int'l., and LaGuardia airports.

Red Mango opened its first U.S. store in July '07 in Los Angeles and now has 60 stores in more than a dozen states. The chain recently opened its first self-serve store at College Station, Texas. It has also introduced kiosk designs. The Grove has approximately 60 locations in airports nationwide. In addition to operating its own branded stores and Red Mango, it operates brands including Dunkin Donuts, Subway, Jamba Juice, and Wendy's.

Section sponsored by Server Products

AHF Debuts First Regional Chapters
Seven new regional chapters have been approved for affiliation with the Association for Healthcare Foodservice. The organization's inaugural chapters, which represent more than 500 local healthcare professionals, are: Chicago Midwest; Florida; Hoosier; North Central Texas; Oregon; Southern Wisconsin; and Washington State. The chapters will provide a forum for members and healthcare foodservice professionals to communicate and exchange information at the grassroots level. Each chapter will have a separate Web page on the national AHF Web site and will receive a scholarship to send a leader to the AHF's national conference in June.

Section sponsored by Server Products

L.A. Food-Truck Chain Plans Franchising
Calbi Fusion Tacos and Burritos, the Los Angeles-based Korean taco- truck chain, has named Coleen Craig as its president. Founded in 2008, the five-truck concept is thought to be the first in the modern wave of gourmet food trucks to begin franchising its name. Craig, a veteran of two decades in the foodservice industry, recently helped found the Southern California Mobile Food Vendors Association. The group seeks a united voice for the 50-plus independent mobile food trucks operating in the greater Los Angeles area.

Parent company Calbi Food LLC was acquired last year by Baja Fresh Mexican Grill CEO David Kim and a group of investors. In addition to franchising the concept to potential operators looking for a lower than usual point-of-entry, Calbi is currently scouting locations for its first brick and mortar restaurant.

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