First Bite

KFC’s newest restaurant in Rome, Italy, marks the company’s 30,000th global location. The company announced the milestone, noting that a new KFC location opens somewhere in the world every 3.5 hours on average.

In 2023, KFC opened nearly 2,7000 restaurants across 96 countries, a 10% development pace and setting a brand development record. More than 80% of unit growth came from 15 publicly traded franchisees. KFC accounts for nearly 50% of parent company Yum Brands’ divisional operating growth.

During Yum’s most recent earnings call last month, executives called out several standout markets for the brand. China, India, Thailand, South Africa, and Spain drove KFC's development during 2023 and were part of a group of 15 countries that grew unit count by more than 25 restaurants. Further, KFC plans to enter its 150th country later this year.

Potbelly just introduced a new six-pack cookie box, available in-store or digitally. In a statement, Potbelly’s CMO David Daniels said, “Our fans have an insatiable love for our cookies and now we’re making it easier for them to enjoy together with others, share as a gift, or save for later.”

In late 2022, Subway also launched six- and 12-pack “Cookie Bundles,” along with the debut of its limited-edition footlong cookie that is now available nationwide.

Meanwhile, KFC recently introduced its new Colonel's Homestyle Brownie, while its sister brand Taco Bell is testing things like Churro Chillers shakes, Baja Blast pie, and the Taco Bell x Salt & Straw Ice Cream Chocolate Taco. Further, Wendy’s just teamed up with Cinnabon to debut a Cinnabon Pull-Apart breakfast offering, Chicken Salad Chick acquired Piece of Cake to sell its signature desserts, and Peter Piper Pizza is adding Buddy V’s Cake Slice and Dippin’ Dots options for guests. Shake Shack is testing desserts at select locations to see if they can boost afternoon traffic and, in Canada, Burger King added new “Blasts,” which are kinda like McFlurrys.

In other words, things seem to be getting a bit sweeter around here.

Noodles & Company CEO Drew Madsen outlined his plan to turn around the fast-casual chain during an earnings call to discuss a punishing fourth quarter for the chain.

Madsen, who had been appointed interim CEO in November following the departure of his predecessor Dave Boennighausen, was named the company’s permanent CEO right before the call.

Total revenue in the quarter ended Jan. 2, 2024, fell by 8.9% to $124.3 million, and same-store sales were down by 4.2%. The company reported a net loss of $6.1 million or 14 cents per share.

Operating margins were down by 50 basis points to 14.7%.

For the year, revenue was down by 1.2% to $503.4 million and same-store sales were down by 1.9%. Noodles booked a net loss of $9.9 million or 21 cents per share.

Central to the plan to turn the brand around is an overhaul of the menu, which Madsen said looks dated, and while it offers familiar and comforting dishes that the chain’s regulars enjoy, “we are not currently a compelling alternative for lapsed guests or new guests.”

For more on what's going on at the restaurant chain, let's turn to senior editor Bret Thorn.

Data collection is more important than ever for restaurant operators, and with so many sources out there — from POS systems to delivery platforms, and from loyalty programs to digital surveys — the potential data mine is infinite. But information collection is not just a numbers game; quality and utility are just as important.

According to the December 2023 Market Leader Report from Nation’s Restaurant News Intelligence, only 21% of operators would rate their data quality as good, while only one-quarter of restaurant operators are confident in their data optimization abilities, revealing the need for more data education.

But just knowing how important data is to the operations of a modern restaurant isn’t enough. Restaurant operators need to build the nuts and bolts of data optimization by asking themselves (and their teams) the right questions.

For more, let's turn to senior technology editor Joanna Fantozzi.

Last week, Panera Bread unveiled its “biggest menu transformation in history,” including nine new items and reimagined recipes and portion sizes, for a total of 20 menu updates. The new menu items include sandwiches like the Toasted Italiano sandwich with Black Forest ham, soppressata and provolone; and salads like the Southwest Chicken Ranch with romaine lettuce, grilled chicken, Ranch dressing, and chipotle aioli. Panera COO Debbie Roberts dubbed the menu overhaul the start of “Panera’s new era” as the company “gets back to [its] roots” in the salad and sandwich categories.

But this brand transformation doesn’t just add new items—it also removes items. Although not included in the original press release, a Panera spokesperson confirmed with NRN that flatbreads would be removed from the menu moving forward. Flatbreads were introduced in 2019 as part of a previous menu overhaul as the JAB Holding-owned company introduced new menu categories specifically designed to target the dinner daypart.

The restaurant business continues to normalize since the Covid-19 pandemic devastated the industry four years ago. But as the bumpiness of the supply chain, staffing levels, permitting delays, and food costs start to smooth out, one major challenge remains: Many employees are not OK.

According to the American Psychological Association, 50% of adults ages 18–34 reported a mental illness in 2023, versus 31% in 2019. That number is likely compounded among restaurant workers, who are most at risk for substance abuse disorders and heavy alcohol use, according to the Substance Abuse and Mental Health Services Association. Overall, foodservice is considered one of the worst industries for mental health, according to a 2017 report from Mental Health America. 

After experiencing a historic labor shortage that impacted sales and operations in 2021 and much of 2022, it seems the industry is now doing more than ever to help its people. Prior to the pandemic, employee mental health programs in the industry were quite rare. In the late 2010s, Chipotle and Starbucks became pioneers here, with the former adding access to mental healthcare and the latter providing inpatient and outpatient mental healthcare and mental health training.

Executive editor Alicia Kelso has more.

One of the hottest beverage trends at the moment originated in Utah and spread with the help of social media.

“Dirty soda” is a sparkling beverage with something creamy added to it — often milk or half-and-half, but also non-dairy options such as coconut cream.

In its current form, the menu platform gained traction with the help of Swig, a 63-unit beverage concept based in Lehi, Utah, and now larger chains are getting in on the action — particularly as interest in nonalcoholic beverages takes off.

Dairy added to soda isn’t a new concept. Ice cream sodas and root beer floats have been around for decades, as has the egg cream — an oddly named drink since it has neither egg nor cream — that was once popular in New York City and is made of seltzer with whipped chocolate syrup and milk.

For more on the history of dirty soda, let’s turn to senior food & beverage editor Bret Thorn.

One of the takeaways from Dine Brands’ earnings call Wednesday morning is that its Applebee’s system plans to close 25 to 35 restaurants this year. Dine Brands CEO John Peyton notes that this is not a right-sizing effort but rather a “deliberate effort to allow franchisees to close unprofitable restaurants, where the market may have moved away from them.”

In the late 1980s, Edna Morris was leading human resources at Hardee’s and was asked by a reporter to be interviewed for a story about women in the restaurant industry. The reporter also asked if she knew of any other women who would be willing to go on the record.

The task was more daunting than she expected it would be.

“It was hard. I did find some. They existed, but we didn’t know each other,” Morris said during a recent interview.

So, the group made plans to get together in person in conjunction with the National Restaurant Association in Chicago and have some deeper conversations. That decision likely changed the course for women in the restaurant industry, as their camaraderie and shared experiences drove them to eventually create the Women’s Foodservice Forum.

Cracker Barrel Old Country Store Inc. is continuing to struggle under new leadership, as new CEO Julie Felss Masino talked about a long road ahead to recovery and long-term profitability for the Lebanon, Tenn.-based casual-dining brand. Cracker Barrel reported a 4% decline in traffic and modest same-store restaurant sales growth of 1.2% with a more than 5% decline for retail sales for the second quarter ended Jan. 26, 2024. The second quarter is generally one of the strongest for Cracker Barrel, as it includes the Thanksgiving and holiday seasons.