Foodservice Equipment Reports Fortnightly

Welcome to FER Fortnightly Online Newsletter
August 26, 2008

Economic Report:
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Foodservice Group

Need To Know The Future? FER Forecasts Are Available In Several Forms
Early 2Q Data: Public E&S Companies Show More Slowing
Commodities Price Outlooks Improve, Some
Blue Chip Lowers '08, '09 Forecasts Again

Industry Report:
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Server Products
Middleby Acquires TurboChef
FER Names Industry Service Award Winners
McD's Pushes For 450 New Units In China By 2010
FER Picks Up Two Editorial Awards

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In This Section:
California Markets Declare Water Restrictions
L.A. Passes Neighborhood Fast-Food Ban
More Towns Try To Cut Through FOG
Menu-Labeling Laws Pop Up Faster Than CRA Can File Suits

This issue's Economic ReportSponsor: Manitowoc Foodservice Group 
Industry Report Sponsor: Server Products
Regulatory Report Enodis

California Markets Declare Water Restrictions
If you don't have enough water to offer freely to your customers, you probably don't have enough to waste in inefficient equipment, either. Since California Governor Arnold Schwarzenegger declared a statewide drought in early June and issued an executive order outlining emergency measures, water districts across the state have reacted with conservation programs.

The East Bay Municipal Utility District near San Francisco is operating under mandatory conservation measures, as are several communities in the Sacramento area. The measures include prohibiting the use of water for washing sidewalks and patios, in decorative ponds and fountains, and in watering lawns or irrigating landscaping more than a certain number of hours or days a week among others. Commercial users such as restaurants are being urged to cut consumption by 12%.

Mandatory conservation measures such as these are considered "Stage 2" of four stages local water districts can take. At Stage 1, these measures are voluntary. Additional measures, including rationing, are implemented at higher stages. Cities from Roseville to Calabasas are already at Stage 1.

San Diego's city council recently imposed Stage 1 conservation measures, with the mayor issuing a "20-gallon challenge" to residents and businesses to cut consumption by 20 gals. per day. Many restaurants there are voluntarily complying by not offering water unless customers ask for it.

Governor Schwarzenegger wants Californians to go further and cut per capita consumption 20% by 2020. If you have stores in California, it seems the smart thing would be fixing leaks, investing in low-flow fixtures and replacing old equipment with water-efficient ice machines, steamers, and dish machines. Otherwise, there might not be any water to serve to your customers.


Section sponsored by Enodis

L.A. Passes Neighborhood Fast-Food Ban
Los Angeles' mayor hasn't yet signed the measure, but the city council voted unanimously on July 29 to pass a 12-month moratorium on new fast-food restaurants in a 32-sq.-mi. section of south L.A.

FER Fortnightly first reported the emergence of the proposed ordinance last October, and then again when a council committee passed the measure July 22, sending it on its way to the full council for the vote.

The plan targets "fast-food" stores, not chain restaurants generally, defining fast-food units as having "a limited menu" and "food served in disposable wrapping or container" and not having table service, among other criteria. Exceptions are allowed for new restaurants that don't build a drive-through window and are at least 750 feet from another fast-food restaurant. Council member Jan Perry, the bill's sponsor, said she hopes to make the moratorium permanent.

Health advocates have lauded the moratorium on nutritional and obesity grounds, while city developers have said it's a way to hold open opportunities for diverse businesses to move into the area.

Civil rights groups and others have argued the topic from both sides, with some saying lower-income consumers are being unfairly targeted by businesses with unhealthy menus, while other groups have accused lawmakers of believing consumers are not capable of making their own choices.

Perry has said some 400 fast-food restaurants already in the lower-income area of the city are contributing to higher than normal obesity rates—30% of adults compared to about 21% in the rest of the city, according to a study conducted in April 2007. That compares to a national obesity rate of about 25%, according to the national Centers for Disease Control and Prevention.

Other jurisdictions now are reported to be considering similar measures. Stay tuned.

Section sponsored by Enodis

More Towns Try To Cut Through FOG
Need more evidence it's time to clean your grease trap or size it properly? An ever-growing number of towns across the country are implementing new ordinances that regulate grease traps in an effort to comply with Environmental Protection Agency deadlines concerning sanitary sewer overflows.

The latest crackdowns on fats, oils and grease we've run across include new ordinances in Ashland, Mass.; Spring Hope, N.C.; and San Marcos and Mexia, Texas.

The Ashland law takes effect on Nov. 15, and the ordinance in San Marcos will likely take effect Jan. 1, 2009. Mexia and Spring Hope hadn't announced when their rules would be effective. For details on all these ordinances, contact local health and/or water departments.

Section sponsored by Enodis

Menu-Labeling Laws Pop Up Faster Than CRA Can File Suits
Not that FER Fortnightly's regulatory news is "all California, all the time," but that tenth of the nation's population is pretty active on the legislative front:

The California Restaurant Association filed suit in late July to block Santa Clara County from enacting a menu-labeling law similar to a San Francisco ordinance the association is already fighting in court. Both bills would require chains to post nutrition information on menus and menu boards.

Meanwhile, the legal wrangling hasn't stopped San Mateo County from introducing its own menu-labeling ordinance.

In mid-August, the five-member county board unanimously approved a rule that would require chains with 15 or more units in California to post nutrition information, including fat and sodium content in addition to calories. Board supervisors still have to approve a second reading of the bill next month.

The CRA has been pushing a bill in the state legislature that would provide a uniform set of rules regarding nutrition information, so chains aren't subjected to a hodge-podge of regulation across the state. A competing bill in the senate, though, has more stringent requirements similar to those in the local ordinances the CRA is fighting in court. Brace yourself for further developments.

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