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A Picture of Health

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How the industry can make classic fast-food dishes healthier.

Fast food gets a bad rap. The industry is actively cutting back on calories, sodium, trans fats, high fructose corn syrup, and other ingredient components that are detrimental to nutrition, but consumers and watchdogs alike are still quick to point fingers when the nation’s health woes come under debate.

Of course, the industry isn’t blameless. Until recently, large portion sizes and indulgent ingredients were the name of the game. And health data over the past four decades show alarming trends: The percentage of overweight adults ages 20–74 rose from 47.4 in 1970 to 68.5 in 2010, while the percentage of obese adults more than doubled from 15.1 percent to 35.3 percent, according to the Centers for Disease Control’s (CDC) “Health, United States, 2012” report. In addition, heart disease continues to be the No. 1 killer of American men and women, despite significant declines over the years reflected in the CDC report.

Statistics like these have made consumers more conscious of what they eat, especially when they eat out, and restaurants have changed with the times.

“I think the industry has done a good job, but we can’t rest on our merits,” says Joy Dubost, director of nutrition and healthy living at the National Restaurant Association (NRA).

Pointing to research published in the Nutrition Journal in 2013, Dubost says that “burgers coming from quick-serve restaurants only contribute … up to 2 percent of calories in the diet at its highest point. That’s for the age group of 12–19-year-olds. So that’s pretty low.” The ever-popular french fry contributes even less, she says.

But in an industry landscape that’s moving in the direction of better-for-you foods, traditional quick serves still have room for improvement, especially in their most classic offerings. Here, we examine five of the most popular menu items—burgers, fries, pizza, sandwiches, and chicken—and what can be done to improve their nutritional profile.

Burgers

Perhaps the most ubiquitous menu item in quick-service restaurants, the burger is a mainstay of the American diet, and it isn’t going away. While fast casuals and better-burger joints have enhanced the burger’s image with premium ingredients and better sourcing practices, operators are still struggling to figure out a successful way to make the burger healthier.

“In terms of the nutritional culprits, it’s really the calories and saturated fats that can add up very quickly in a burger,” says Nicole Ring, director of nutrition at Healthy Dining, an organization that offers nutritional analysis and menu development assistance to the restaurant industry and maintains an online resource guide for consumers. “We’ve seen, when we do nutritional analysis at quick-serve restaurants, the bun alone can have upward of 300 calories. That’s before you’ve added any of the protein and the toppings.” Many restaurants will also add butters to enhance the flavor of a bun, which can be a hidden source of extra calories and fat, she adds.

At fast-casual chain Mooyah Burgers, Fries & Shakes, founder Rich Hicks tackles the problem of a highly caloric burger bun with a staple menu item known as the Iceburger. Wrapped in lettuce rather than sandwiched between bread, the Iceburger eliminates as many as 200 calories and 4.5 grams of fat when compared with the brand’s white and wheat buns.

“We’re seeing an uptick in the Iceburger,” Hicks says. “It’s something our customers really want because it addresses a lot of dietary needs.”

A few Mooyah locations also serve smaller buns, at 2 ounces instead of 2.5 for regular white and 2.7 for regular wheat. The smaller buns have only 140 calories. The brand also goes beyond beef, offering both a turkey patty and a black-bean veggie patty. Hicks says he sees more turkey burgers carving into beef purchases year over year at the chain, and the popularity of the veggie burger has risen, too. While the turkey and veggie patties may not be significantly lower in calories compared with Mooyah’s beef patty, both have less fat—the veggie burger has less than half of the beef patty’s 18 grams of fat.

“I think [quick-service restaurants] have a big problem with what they’re putting between the bun,” says Jayne Hurley, a registered dietitian with the Center for Science in the Public Interest (CSPI), a nonprofit advocacy group that focuses on improving the health and safety of food. “The problem with lean ground beef is that a 3-ounce cooked patty is going to have a third of a day’s saturated fat.”

McDonald’s 2.9-ounce beef patty, the size (after cooking) offered on Quarter Pounder burgers, has 16 grams of fat, accounting for 25 percent of a daily serving, and 7 grams of saturated fat, accounting for 35 percent.

“Restaurants may be hesitant to provide a leaner cut of meat because … that fat is going to provide a really nice mouthfeel and taste,” NRA’s Dubost says. However, that doesn’t mean there aren’t opportunities for improvement in the meat. Dubost suggests chains consider beef patties that are at least 93 percent lean.

Fries

Frequently acting as the burger’s sidekick, the french fry has the ability to drive up calories, fat, and sodium. But Dubost says they aren’t as bad as one would think.

“Frankly, french fries get a bad reputation,” she says. “Potatoes in general, even if they’re prepared fried, are the best source of potassium of all the vegetables, and Americans don’t consume enough potassium in their diet. They’re also high in fiber.”

That said, there are still things quick-serve owners and operators can do to lighten the load of this staple side dish. Looking at fresh versus frozen or pre-cut potatoes is one place to start, Ring says. “A lot of pre-packaged frozen fries have a coating added to the potato, so there’s likely extra fat, sodium, and carbohydrates depending on what’s in the coating,” she says.

Some fast-casual concepts, like Five Guys Burgers & Fries, are offering hand-cut fries as a healthier, more premium version of the side dish.

“Leaving the skin on adds to the nutritional value,” says Don Odiorne, vice president of foodservice for the Idaho Potato Commission. “The cost is worth it if you want to make [fries] a signature item and if you can charge a little more to cover the labor costs. It is not unusual at a Five Guys or Cheeseburger Bobby’s, for example, to dedicate one to two people full-time to cutting, blanching, storing, and finish frying.”

But Odiorne says he wouldn’t always bet against pre-cut, pre-packed potatoes. In fact, he says, some suppliers offer fries with a coating intended to help the potato absorb less oil during frying.

Less oil absorption is reported to be the trick to Burger King’s game-changing Satisfries. The new alternative offers 30 percent less fat and 20 percent fewer calories than the brand’s normal fries; compared with McDonald’s fries, they have 40 percent less fat and 30 percent fewer calories. As the first mainstay quick serve to focus on the french fry so intently, Burger King set out to prove that change is possible.

Pizza

While pizza has the potential to be healthy, there is arguably less innovation in the segment in regards to nutrition.

Dubost says it’s often hard to control pizza’s nutrition. “Pizza can be a very healthy dish to have, but portion size can be hard to control because people will just eat so much of it,” she says.

There are, however, ways to improve the nutrition of individual ingredients. CSPI’s Hurley says crust should be of particular concern to those who are serious about offering healthier options. She says a thinner crust is the way to go.

At Pizza Hut, a slice of a 12-inch cheese Pan Pizza has 240 calories, 10 grams of fat, and 540 milligrams of sodium. A slice from a 12-inch cheese Thin ’N Crispy pizza has 190 calories and 8 grams of fat, but 580 milligrams of sodium, perhaps to enhance taste. The brand’s new Hand-Tossed Style Pizza, arguably inspired by the growing list of fast-casual options available, has 220 calories, 8 grams of fat, and only 480 milligrams of sodium per slice.

At Domino’s, the stats are similar: A small Crunchy Thin Crust has 330 less calories than its small Hand Tossed Crust, and the thin crust option has only 85 milligrams of sodium, compared with 930 milligrams in the latter option. The brand also offers a gluten-free crust as a healthier alternative.

Healthy Dining’s Ring says quick serves could learn a lot about different flour from their fast-casual counterparts. “We work with a pizza chain, RedBrick Pizza, that puts wheatberries in its crust to offer more nutritional impact,” she says. It wouldn’t be too far-fetched for Domino’s, Pizza Hut, and the like to offer something similar, she adds.

In fact, Domino’s already has a model for healthier pizza within its system—the company’s Smart Slice pizza, which is offered to schools, has 24 grams of whole grain per serving and 35 percent less sodium than its traditional pizza. It’s also made with pepperonis that have 33 percent less fat and 50 percent less sodium than its traditional pepperonis, and the lite Mozzarella has half the fat of the brand’s regular Mozzarella.

Sandwiches

Much like the burger, the sandwich has several components that can be tweaked to offer consumers a bevvy of nutritional value—there’s the bread, proteins, cheeses, vegetables, and condiments. One of the most customizable quick-serve staples, the sandwich had seen a fair amount of innovation and heightened attention to quality ingredients.

As the category leader, Subway has positioned itself as a healthful alternative to other fast-food options through careful marketing and its iconic spokesman, Jared Fogle. And company executives have put their money where their mouth is, continually working to improve Subway’s nutrition.

“Back in 2009, we were looking at nutritional parameters, and there was a lot of talk about sodium in the diet,” says Lanette Kovachi, Subway’s corporate dietitian. “We thought we could do more to make our sodium levels more responsible.”

Since then, the chain has cut sodium in its sauces, turkey, ham, roast beef, and bread, accounting for a 30 percent decrease across its entire menu, Kovachi says. The changes make Subway a more ideal choice for those seeking a heart-healthy diet.

“We know definitively that sodium increases blood pressure … particularly as one ages and in certain populations. If you have higher blood pressure, that’s a risk factor for heart disease,” NRA’s Dubost says. “The controversy revolves around if a high-sodium diet drives up the risk of heart disease, and that’s where the evidence hasn’t been as clear. Nonetheless, blood pressure has been an issue in this country.”

Kovachi says Subway’s commitment to nutrition often means months, sometimes years, of recipe and product testing because the chain can’t compromise flavor. “Of course, bread has the biggest impact on our nutrition, so if we can do something positive to the bread, we can do something positive to the sandwiches,” she says. In 2011, the brand fortified all of its bread varieties with calcium and vitamin D, and a 6-inch piece of bread offers as much calcium as a glass of milk.

“For us, it’s extremely important that we’re ahead of the nutrition trends. It never stops—we’re always looking at ways to improve the products,” Kovachi says. “We also always want to have choices for our customers, including those more indulgent choices.”

CSPI’s Hurley says portion size plays a big role in how healthy a sandwich can be. “Sometimes this means you’re consuming more calories than you would in a burger,” she says. “If you’re talking about a fast-casual place like Panera or Au Bon Pain, those kinds of places have a problem with the size of their sandwiches.”

When compared with Subway’s 6-inch Turkey Breast sandwich, Panera’s Smoked Turkey Breast on Country Bread has almost double the calories—430 to Subway’s 217. Au Bon Pain’s Turkey and Swiss sandwich weighs in at 740 calories.

“Half portions for sandwiches are really ideal from some chains because they can just be so large,” Healthy Dining’s Ring says. “You can have those with a salad and light dressing, and it becomes a much better option.” Both Panera and Au Bon Pain offer half-sandwich portions.

Ring says there is still room in the segment to add new sauces, vegetables, and even fruits. “We’re seeing a lot of restaurants get creative and use hummus as a spread instead of mayo,” she says. “Some other unique ingredients we’ve seen include thinly sliced sweet potatoes and thinly sliced green apple.” For its part, Subway recently ensured all of its restaurants offer spinach year-round and avocados during the summer.

Chicken

Chicken, when pared down to its poultry essence, is a healthy, lean protein source. But when seasoned and battered and fried, not so much.

“Obviously, if you’re not going to fry, and you’re going to bake, grill, or boil, it’s going to drive down calories,” Dubost says. “With fried chicken, the breading can drive up fat and sodium, and not all chicken is heavily breaded. That’s one thing you could be mindful of.”

Sodium is a key area of concern because many chains offer poultry that’s been injected with salt water to increase food safety, Dubost says. The Food and Drug Administration suggests that one’s daily intake of sodium should be no more than 2,400 milligrams.

At KFC, which boasts a variety of fried chicken options seasoned with a secret combination of herbs and spices, a single Original Recipe chicken breast can account for nearly half a day’s sodium intake, at 1,080 milligrams. The same cut of meat in the brand’s Extra Crispy recipe has 1,140 milligrams of sodium, along with 8 more grams of fat. Comparatively, a breast from the KY Grilled Chicken Bucket has only 730 milligrams of sodium, two-thirds less fat than the Original Recipe, and 6 more grams of protein—proof that it is possible to offer a healthier grilled option at even the most traditional of fried chicken chains.

Beyond decreasing sodium and offering different preparation methods, there are other small changes those in the chicken segment can make to improve the overall quality of offerings, experts say. Chick-fil-A is one example of a brand flying under the radar with its attention to nutritional detail. The brand worked to remove dyes from various menu items and is testing a new type of peanut oil without tert-Butylhydroquinone, a form of butane used as a preservative in foodservice.

“We have a good long-term relationship with [our suppliers],” says Jodie Worrell, senior nutrition consultant at Chick-fil-A. “When I’m working on something, I turn to them, tell them what we’re looking for, and they will help us develop it.”

Worrell adds sodium reduction to the list of important initiatives Chick-fil-A has tackled over the years.

The brand also places an emphasis on its grilled chicken options, which rolled out as a sandwich option in 1989. The Chargrilled Chicken Sandwich has 310 calories, 3.5 grams of fat, and 830 milligrams of sodium. “It’s really part of our long-term menu strategy of creating a menu of craveable food that’s increasingly healthy, natural, and sustainable,” says Brian Kolodziej, senior manager of culinary. In 2004, he says, Chick-fil-A switched its bun to a golden wheatberry version for added nutrition, and he and his team continue to work with suppliers and menu developers on various initiatives.

The NRA’s Dubost says an inclusive process for change can yield success like Chick-fil-A’s. “We have to continue to improve by working with suppliers, working with chefs, working with nutritionists and food scientists to provide food that’s healthy but also tasty enough that consumers crave them,” she says.

Quick Tips

Easy ways to make these fast-food staples healthier.

Burgers: Consider replacing the bun.

Fries: Hand-cut potatoes and leave the skin on.

Pizza: Use a healthier flour for the crust.

Sandwiches: Decrease portion sizes.

Chicken: Change the cooking technique.

April 2014

Industry experts, nutritionists, and menu developers share ideas on how the industry can make classic fast-food dishes healthier.

Quick service brands enhance nutritional profile of favorite foods like pizza.
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Quick-service operators are tweaking the nutritional profiles of staple menu items like pizza, which can be made healthier through crust innovation.
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New Study Reveals America’s Favorite Quick-Service Chains

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Pizza segment rankings from Market Force Information survey.
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With new limited-service brands emerging at a rapid pace, consumers have more dining choices than ever, and their preferences are proving that established national concepts could learn a thing or two from these smaller, younger chains. According to a nationwide study on consumers’ favorite quick-service chains from Market Force Information, brands like Firehouse Subs, Qdoba, and Papa Murphy’s rank better for customer satisfaction compared to more established category players like Subway, Taco Bell, and Pizza Hut.

The Market Force Information Study polled more than 6,100 consumers who were asked to rank the top restaurants in four popular categories: pizza, Mexican fare, sandwiches, and chicken. “We then ask respondents to rate their last experience at a given brand and let us know if they would recommend eating there, and we use that data to rate each brand,” says Janet Eden-Harris, CMO and senior vice president of strategy at Market Force Information. In addition to ranking restaurants consumers favor most, the study looks at what contributes to these preferences, analyzing factors such as service, food quality, and value.

In the chicken segment, Louisiana-based Raising Cane’s topped the list, followed by Chick-fil-A and Zaxby’s, and all top three chains scored best for food quality. In the sandwich category, Firehouse Subs ranked No. 1 and was the favorite for friendly service and accommodating children, also taking second place in quality food and atmosphere. Panera Bread ranked No. 2 overall, followed by Jimmy John’s and Subway. In the Mexican segment, Qdoba beat out Chipotle, coming in as No. 1 overall—respondents pinpointed the brand for its varied menu items, including specialty burritos and a three-cheese queso sauce.

Eden-Harris says the rankings reflect how newer and smaller brands are offering consumers something new. “The value of having a tried-and-true brand is that consumers know and can count on what they’re getting. But it terms of driving big satisfaction, you have to go above the basics, and a lot of these new, emerging brands are mixing it up,” she says. “Qdoba lets you pick and customize, so a consumer knows they will like what they get. A lot of these emerging brands have a new take on their categories.”

The pizza category rankings were particularly interesting, Eden-Harris says. Take-and-bake concept Papa Murphy’s came in at No. 1 overall and was rated first for both quality and healthy food and second in fast service and value.

“It’s interesting to see how Papa Murphy’s has risen to the top—they were there when we did this study last time a little more than a year ago,” Eden-Harris says. “You start to see some of the brands that do particularly well on a couple key attributes, and we see it across categories—we call these operational excellence attributes. It’s things like having fast service, having friendly service, offering a warm atmosphere, or healthy food changes.”

Pizza Ranch came in second overall for the category, followed by Papa John’s, Cici’s Pizza, Domino’s, and Pizza Hut. Pizza Ranch received the most votes for atmosphere and accommodating children, and CiCi’s was second in both categories. The fastest service went to Little Caesar’s, while CiCi’s took the top spot for value.

“It’s good for people in the business to see these results because a lot of these attributes consumers value are ones [operators] can influence,” Eden-Harris says. “It’s really hard if people were rating higher based on something like a convenient location. You can’t help that, but you can invest in things like training and hiring the right kind of people.”

By Tamara Omazic

 

 

 

 

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Subway Moves Forward with Sustainability in Mind

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Don Fertman, Subway’s chief development officer.
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Subway is doubling down on its sustainability efforts. During a press conference in a New York City restaurant on Tuesday, May 6, brand executives discussed the quick-serve chain’s latest innovations in green sourcing, among other news.

“We are trying to make our restaurants and our operations as socially responsible and environmentally responsible as possible,” says Elizabeth Stewart, director of corporate social responsibility, in a phone interview with QSR. “Our vision is to continue to evolve our menu to have a variety of great-tasting options, whether it’s indulgent or better-for-you options, but to do it in a way that reduces our environmental footprint and has a positive impact in the communities we operate in.”

Stewart says Subway’s efforts have already resulted in a smaller environmental footprint and reduced landfill output.

“We’ve increased our recycle count,” she adds. “Ninety-five percent of our products now can be recycled or composted, and 100 percent of our paper-based products are made from either recycles material or from certified sustainable wood pulp.”

Many of the changes made have come from issues Subway addresses that are not rooted in sustainability but do present an opportunity to be more green. For example, when Subway sought to redesign its salad bowls because of a functional problem with the lid, the company was able to reformulate what materials went into the new bowls to significantly reduce the landfill impact, Stewart says.

“Not everybody embraces sustainability, so what we try to do is a three-pronged approach … where we always think about sustainability when we are solving a problem,” she says.

Don Fertman, Subway’s chief development officer, echoes Stewart. He says the brand is constantly seeking new ways to increase its commitment to being green. The brand’s latest Global Challenge, a worldwide competition for consumers to build and run their own virtual store, connected Fertman and the Subway team with Nithyanandam Yuvaraj Dinesh Babu, a contestant originally from New Delhi and one of three winners.

“He’s an eco-engineer, and he’s all about taking any concept … and reducing its environmental footprint and finding sustainable sources of energy,” Fertman says. “He actually created a virtual store that was designed to do that, so we’re learning from him about that.”

The Global Challenge is a learning opportunity for participants, Fertman says, but it’s also a chance for Subway to analyze expansion and new locations. In moving forward, the brand will grow with the environment in mind, focus on improving the nutritional quality of its menu offerings, and also concentrate efforts on nontraditional expansion.

By Tamara Omazic

 

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Courting Calorie Counters

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The nutritional value of limited-service restaurant food has been the topic of debate among consumers, critics, and operators for some time. Growing concerns over Americans’ high obesity levels have only heightened the debate, leading some observers to encourage increased governmental regulation of food, others to urge more focus on informed, unforced choice.

Much of the talk has been about calories, because consuming too many of those without accompanying exercise results in additional pounds.

Many limited-service restaurant companies have added or emphasized lower-calorie items, launched low-cal menus, or provided data to make it easier for guests to calculate the calories in their meals. Still, some local and state governments enacted regulations requiring numerous food facilities, including restaurant operators with more than 20 units, to list calories and other nutritional data for regular food items on their menus or menuboards.

That regulation is going national as part of the Affordable Care Act. Exactly when that will occur, however, remains uncertain, because the U.S. Food and Drug Administration (FDA), which was charged with writing the regulations, has found a variety of challenges.

“There are a number of complex issues involved,” writes FDA spokesman Arthur Whitmore in an email. The agency received more than 900 comments on the most recent proposal, and “is evaluating each comment before publishing a final rule.”

Although restaurants don’t always like to be told what to list on their menuboards, they should still embrace low-calorie menu items, says Hank Cardello, senior fellow at the Hudson Institute in Washington, D.C. “This is good business, not a moral issue,” he says.

Cardello, who also directs the conservative think tank’s Obesity Solutions Initiative, collected data on menu-item sales at 21 big restaurant chains, including nine quick-service and fast-casual companies.

“We were interested where the sales growth was coming over recent years,” he says. “It turns out that the growth came from the low-calorie items.”

To be considered “low calorie” in the study, center-of-plate items were 500 or fewer calories, while sides, appetizers, and desserts had to be no more than 150 calories. Eight-ounce beverages clocked in at 50 calories or less. Those levels allow a customer to create a balanced meal that fits in with the FDA’s recommended 2,000 calorie-per-day intake, Cardello says.

The survey found that restaurants adding low-calorie items outperformed those eateries that reduced them. For instance, same-store sales at chains adding low-cal items rose 5.5 percent from 2006 to 2011, while eateries that reduced them fell by the same percentage.

“It shows that you have to pay attention and restructure your menu to capture these customers,” Cardello says, noting that new items, such as Burger King’s Satisfries, not only have lower calories than regular menu items, but also can boost sales.

Despite the FDA’s delays, several limited-service restaurant companies, including McDonald’s and Starbucks, have already added calorie counts to their menuboards. McDonald’s began listing calories on menuboards in September 2012, a few months after launching its Favorites Under 400 menu.

That menu, which highlighted popular items with 400 or fewer calories, helps guests “make an informed decision about whether a particular menu choice could fit within their individual calorie needs,” writes spokeswoman Christina Tyler in an email.

Now that all McDonald’s in America have calorie counts on their menuboards, the 35-item Favorites Under 400 menu is only listed online.

Calorie counting is a key part of Wendy’s smartphone application, which also allows customers to find a restaurant, pay for meals, and more. Since the app was launched two years ago, it has been downloaded nearly one million times.

Wendy’s research indicated that many guests were interested in nutrition, and the company decided that it could do more with its menu database than just churn out a nutrition chart. The information could be baked into an informative application.

“We have a really good product, and we don’t need to hide behind gimmicks,” says Brandon Rhoten, vice president of digital marketing for the company. “We would rather be helpful and give the consumers what they need.”

As the Wendy’s team was developing the app, they considered more practical consumer needs. “If you want 800 calories for lunch, we can give you options. And we can do the math the other way,” Rhoten says, so a diner can build a meal and have the app count the calories.

One meal choice with less than 500 calories is a Grilled Chicken Go Wrap, Garden Side Salad, and bottled water, totaling 470 calories. By personalizing the chicken wrap to eliminate cheese, 30 calories are removed, which lowers the meal to 440 calories. It typically takes no more than several seconds to do this on an app, making it easier than doing the math from a nutritional chart, Rhoten says. And a configured meal can be quickly saved for future reference.

Some restaurants are creating low-cal menus with entirely new items. One of them is El Pollo Loco, which created its 5 Under 500 Calories menu with five new items made mostly from ingredients that the Costa Mesa, California–based chain was already using.

“El Pollo Loco has always had a healthy halo because of the cooking we do and the items we have,” says Heather Gardea, executive chef. “The basic ingredients for the 5 Under 500 Calories menu were already at the restaurant, but never combined together.” Mango salsa is the only new ingredient created for the low-cal menu.

The new dishes don’t reduce portion sizes to cut calories, Gardea says, and the 500-calorie level was selected “because that’s a substantial meal for lunch or dinner. It’s not a component of a meal, like a taco or burrito, but a full meal.” In addition to a Mango Grilled Tostada, new menu items include the Mango Taco Plate, Avocado Salad, Avocado Burrito, and Black Bean Bowl. The menu items include neither fried ingredients nor two mainstays of Mexican cooking: pinto beans and rice.

“Pinto beans don’t have the same healthy feeling as black beans among consumers, and adding rice would make it feel heavier,” she says.

Subway, known for offering low-calorie alternatives, created a trio of 3-inch morning flatbread sandwiches—Steak, Egg White, and Cheese; Egg White and Cheese; and Ham, Egg White, and Cheese—that each carry fewer than 200 calories.

“We actually were not specifically targeting 200 calories,” says Lanette Kovachi, senior dietician, in an email. But with egg whites, lean meats, and smaller portions of bread and cheese, the sandwiches offered less fat and “also happened to be under 200 calories.”

This allows consumers to choose a sandwich, a side like apples, and a beverage, and “still have a sensible breakfast that does not break the calorie bank,” she says.

The breakfast sandwiches complement Subway’s eight 6-inch Fresh Fit sandwiches on the regular menu. All have fewer than 370 calories, and most include at least one protein, such as chicken, turkey, ham, or roast beef.

It’s not unusual for restaurants to launch low-calorie menus at the beginning of the year to take advantage of consumers’ resolutions to lose weight. This is usually accomplished with existing lower-calorie menu items.

That’s what McAlister’s Deli did in developing its Lite Choose Two menu, featuring more than 200 items—sandwiches, soups, salads, and potatoes—that can be paired but still clock in at fewer than 600 calories.

“We looked at the industry and saw some restaurants’ low-calorie menus had 600 calories, while some did 500,” says Frank Paci, president and chief executive. “We just believed we had a lot more choices for customers at 600 calories.”

The combos feature two smaller-size items, like a half-sandwich and cup of soup. They range from the Turkey Melt sandwich and Fire-Roasted Vegetable Soup (370 calories) to the McAlister’s Club sandwich and Chicken Tortilla Soup (590 calories).

“We’ve had the regular Choose Two menu for years, allowing guests to customize,” Paci says. “We took that and are presenting it by calories.”

Although the menu was planned only as a promotion for the first quarter of last year, McAlister’s decided to make it more permanent, putting the menu on laminated cards because guests were asking for it, Paci says. Its popularity proves “you don’t have to sacrifice flavor for calories,” he says.

Boston Market used a similar philosophy by creating a roster of 100 meals with fewer than 550 calories. Many of the meals feature the chain’s signature rotisserie chicken, chicken breast, or turkey, plus one or two regular side dishes. A large percentage of the regular menu fits in this category.

“That’s what we love about it,” says Sara Bittorf, chief marketing officer. “It’s a great opportunity to eat well and not feel like you’re depriving yourself.”

The quarter-chicken dark meat, along with sweet corn and garlic dill potatoes, for instance, has 530 calories, which is the same as the turkey with mashed potatoes, poultry gravy, and steamed vegetables.

Boston Market, based in Golden, Colorado, considered adding new menu items to its under-550-calorie offerings, but decided it had enough options, Bittorf says. “We feel we have one of the most extensive low-calorie menus in the fast-casual category,” she says.

The low-calorie effort is a byproduct of the chain’s interest in offering healthful items. Offering naturally lean chicken and turkey and cooking the chicken on spits so the fat drips off keeps the calories down. The chain’s poultry gravy is only 10 calories, so “it feels like an indulgence to have chicken and gravy or turkey and gravy,” Bittorf says.

Not all lower-calorie menus are recent. Taco Bell launched its Fresco menu several years ago, featuring special versions of the steak or chicken Burrito Supreme, the Crunchy Taco, and Soft Tacos with steak, chicken, or seasoned beef.

“Our customers love the flavors of our Mexican-inspired food, and Fresco was the answer,” says Missy Nelson, a nutritionist on the company’s product development team, of diners who wanted Taco Bell menu items but with fewer calories and less fat.

This was accomplished by replacing cheese and any mayonnaise-based sauces in regular items with pico de gallo made daily in each restaurant. All of the Fresco items have fewer than 350 calories and 10 grams of fat. The fan favorites, Nelson says, are the Crunchy Taco (150 calories with beef compared with 170 calories on the regular menu) and Soft Taco with beef (160 calories versus 190 calories).

Each regular item on the menuboard with a Fresco version has the words Make it Fresco below it. “A great thing about us is we are all about customization, so you can Fresco-style almost any item at no extra cost,” Nelson says.

Even individual franchisees of some companies developed their own menus that feature lower-calorie items. For instance, the northeast Ohio Panera Bread franchisee teamed up with the noted Cleveland Clinic to develop a heart-healthy menu. Covelli Enterprises, Panera’s largest franchisee, presented a list of menu items and meals to the hospital, which pared it down to meet certain criteria: 4 grams or less of saturated fat, no trans fats, 600 grams of sodium, and whole grains instead of refined ones.

Calories aren’t specifically restricted, but “you’re limited calories” by the criteria, says Julia Renee Zumpano, cardiovascular dietician at the clinic.

May 2014

Making it easier for customers to watch their weight can be smart business.

Healthier quick service restaurant menus serve healthier minded customers.
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McAlister’s Veggie Club and Fire Roasted Veggie Soup
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Subway Expands Nontraditional Presence in PA

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Subway announces Lehigh Valley, Pennsylvania stores

Subway restaurants plan to continue the expansion in non-traditional locations by utilizing established businesses in the Lehigh Valley, Pennsylvania area.

This expansion creates a new platform for Subway restaurants to reach new customer bases such as families, hospitals, and business centers.

The local Subway Development of Eastern Pennsylvania Inc. (SDEPA) has opened many successful non-traditional locations within universities, theme parks, and casinos, with plans to expand.

In the early 1990s, the SDEPA opened the first non-traditional location at Dorney Park & Wildwater Kingdom. Originally franchisee owned and operated, the restaurant opened after simple prospecting and familiarizing park management. In 2006, Cedar Fair Dorney Park purchased the non-traditional Subway restaurant and opened a second store within park grounds. Today, this location is one of the most successful store locations in Pennsylvania—even though the doors are open only six months out of the year.

“We commonly see an initial investment of a non-traditional site expand into a much larger footprint and more prominent location, like our presence in Dorney Park,” says Ken O’Brien, vice president of business development at SDEPA. “Our small restaurant footprint allows us to fit into spaces that are otherwise not suitable for other chains.”

New Subway locations will open within the coming months in the Lehigh Valley area, including in hospitals and universities.

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Subway Partners With Keurig for Coffee Systems

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Subway partners With Keurig for coffee systems

Keurig Green Mountain and Subway announced a partnership to bring Keurig’s single serve brewers to thousands of the Subway’s North American locations.

Currently, more than half of the Subway restaurants in the United States and Canada have adopted a Keurig system.

“Keurig brewers offer quality and convenience, which are key advantages as Subway restaurants look to provide customers with a consistently high-quality cup of coffee brewed fresh no matter the time of day – not just at breakfast,” says John Whoriskey, president, U.S. Sales and Marketing of Keurig. “Keurig brewers help Subway franchisees simplify operations by eliminating the need for separate brewing of regular, decaffeinated, and flavored coffee, reducing waste and clean-up of unconsumed coffee.”

“Since introducing Keurig brewers as an option to our franchisees last year, we’ve heard overwhelmingly positive feedback about Keurig’s ability to delivery variety, quality, and freshness on demand,” says David Zambory, the beverage manager for the Subway restaurant chain. “Subway restaurants are a destination throughout the day, including at breakfast, and we look forward to providing our customers with the freshest cup of coffee possible no matter when they visit us.”

The Keurig K150 Series Commercial Brewing System is the first small to medium capacity Keurig brewer to be certified by the National Sanitation Foundation (NSF) for foodservice use, marking Keurig’s continued commitment to expanding availability of Keurig brewing simplicity.

“Until now, innovation in brewed beverages for quick serve restaurants has been focused on high volume applications and longer brewed coffee holding times,” Whoriskey says. “This has left the majority of operators, who want to serve delicious brewed beverages, far behind. Keurig is changing the way Subway restaurants are thinking about brewed beverages by delivering a fresh brewed, delicious beverage at all times during the day to consumers who recognize Keurig as a symbol of quality.”

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Subway Canada Launches Lobster Sandwich

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Subway announces lobster sandwich

Now for a limited time at participating Subway Restaurants in Canada, customers can enjoy all the meat without the mess and all the flavor without the fuss with the national launch of the Subway Lobster Sandwich.

"For years, lobster has been a popular summer offering within Subway Restaurants in Atlantic Canada," says Kathleen Bell, Director of National Marketing, Subway Restaurants of Canada. "We wanted to bring the ease and convenience of enjoying premium Atlantic Canadian lobster to all Canadians and are thrilled that Subway Restaurants will offer this fully customizable lobster sandwich."

Subway Canada's lobster sandwich features chunks of lobster meat from Atlantic Canada, lightly mixed with mayonnaise. The sandwich is fully customizable with all Subway toppings. For a truly Maritime experience, Subway suggests pairing the lobster with lettuce on toasted Italian bread.

In addition, Subway is asking Canadians to share their best lobster face as they pose with their lobster sandwich for a chance to win the ultimate outdoor lobster party. One Canadian will win the Subway #LobsterSelfieContest grand prize of a platter of Subway Lobster Sandwiches, a $100 Subway cash card, and an outdoor party pack. Secondary prizing includes 10 $25 Subway cash cards. The contest opens on Twitter June 23 and runs until July 23. 

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Uncommon Ground

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Operators squeeze their brands into nontraditional real estate.

A cruise ship on the Rhine River in Germany.

The FBI headquarters in Washington, D.C.

A Toys“R”Us in Manhattan.

The Camp Pendleton military base near San Diego.

Where moving people are, quick-service restaurants want to be, a reality that continues shaping the rapid and aggressive evolution of the nontraditional restaurant marketplace. From casinos and college campuses to museums and hospitals, retail stores, and theme parks, quick serves have moved far beyond street locations and mall food courts to launch units just about anywhere they can capture customers.

“We even had one store that was a truck following a particular military unit,” says Elizabeth Rolfe, Subway’s director of new business development.

For growing quick-service concepts, nontraditional units offer a compelling play, allowing companies an opportunity to increase their unit counts, reach new customers, expand their franchisee network, and

capture some impressive revenue courtesy of a captive, convenience-craving audience. Such benefits have heightened competition in the nontraditional space and, subsequently, demanded brands enforce more strategy than ever before to land the right sites with the right partners.

A smart brand play

Few quick serves know the nontraditional space quite like Maui Wowi Hawaiian, which runs about 50 traditional stores and 400 mobile units across 35 states and seven countries.

“Nontraditional is our tradition,” Maui Wowi CEO Mike Weinberger says.

The Colorado-based concept peddling coffee and smoothies boasts outlets in stadiums, theme parks, convention centers, racetracks, and at temporary events across the U.S. At the Houston Livestock Show and Rodeo last March, franchisees Rob and Jean McLean served more than 42,000 smoothies over 20 days, a sign of the appealing revenue a well-placed nontraditional unit can bring.

“A lot of people are realizing nontraditional is a great niche, particularly for franchising companies,” Weinberger says.

Auntie Anne’s executives are among them. In 1992, the pretzel-slinging enterprise made its first foray into nontraditional waters when it opened an outlet in the Pittsburgh International Airport; three years later, the company debuted an outlet at Penn Station in New York City. In subsequent years, however, Auntie Anne’s largely maintained its focus on shopping malls, the bread and butter of its business, says Brian Boycan, Auntie Anne’s vice president of nontraditional development. At best, nontraditional development was a modest side project.

That all changed in 2009, when the Pennsylvania-based company’s strategic plan earnestly examined the company’s growth prospects. With mall traffic trending downward and Auntie Anne’s already claiming a presence in many of the nation’s favorable mall destinations, company leaders recognized the need to “fish in other ponds,” Boycan says.

“We were running out of space with the malls, and branching into nontraditional development allowed us the best opportunity to keep growing,” Boycan says. The company began opening outlets in airports, amusement parks, and military bases, reaching hordes of American consumers who avoided shopping malls, namely men.

Today, nearly one-fifth of Auntie Anne’s unit count falls under the company’s nontraditional umbrella, a number Boycan says is rising fast.

“Nontraditional development now outpaces our traditional growth … and it has been a windfall for us,” Boycan says.

Companies like Maui Wowi and Auntie Anne’s are far from alone in pushing the nontraditional development button. Dunkin’ Brands has largely re-entered the California market through nontraditional venues in military bases, travel centers, and hotels, an aggressive play that the Massachusetts-based company believes will help it fulfill its long-term goal of operating as many as 1,000 units in the Golden State.

Dunkin’ Brands director of nontraditional development Chris Burr says nontraditional units are helping the company introduce the Dunkin’ name to new customers and markets, propelling product trials and the concept’s westward
development push.

But Dunkin’s nontraditional development, which accounts for about 9 percent of the chain’s total asset base, also allows the company to re-engage with light or lapsed users, while simultaneously providing its existing customer base greater access (read: frequency) to the brand. Best of all, Dunkin’ does not have to discover the real estate, but can seize existing space in visible, high-traffic spots.

“Those opportunities are immensely attractive,” Burr says, adding that some nontraditional venues, such as universities, office complexes, and hospitals, not only offer a regular customer base, but also opportunities for catering and other revenue-building maneuvers.

Many quick-service concepts developing in the nontraditional space also relish the opportunity to work with experienced foodservice operators, such as master concessionaires like Aramark and Sodexo, especially since positive relationships with well-resourced concessionaires or corporate partners can deliver a large number of sites in quick time.

In 2010, Auntie Anne’s inked a deal with HMSHost, a master concessionaire at airports and travel plazas. From fewer than 50 airport and travel-plaza locations before the HMSHost deal, Auntie Anne’s now has more than 80.

Similarly, Subway has leveraged its partnership with Pilot to quickly assemble a roster of more than 200 restaurants in Pilot fuel stops across the country.

An evolving marketplace

In recent years, Subway’s Rolfe says, the nontraditional marketplace has endured a significant shift, becoming less niche and more recognized, more crowded. When Subway first went to hospital trade shows years ago, she says, people inquired about their presence. These days, hospitals call the sandwich chain’s Connecticut headquarters and chase the brand as a partner, intrigued by Subway’s name recognition, R&D, and marketing backbone.

“It’s so much easier to work with an established quick-service partner who has the nontraditional expertise,” Rolfe says, noting that about one quarter of Subway’s 42,000 global locations sit in the nontraditional camp.

While nontraditional development among branded quick serves had been gaining momentum throughout the 1990s and early 2000s, the recession delivered a new normal, one that continues to evolve.

Amid the recession’s falling sales and traffic numbers, many quick serves sharpened their competitive elbows to secure space in nontraditional venues, eager to capture any persuasive revenue plays. As a result, the competition—and, in some cases, the costs per square foot—intensified, which led many quick-service companies to look beyond the commonplace nontraditional development opportunities, such as airports, travel plazas, colleges, and stadiums, and embrace more novel opportunities, such as museums, office buildings, and even churches.

Subway, in fact, has development agents in markets across the country tasked with identifying prospective nontraditional opportunities, no matter how seemingly wild.

“We don’t limit ourselves in any way,” Rolfe says.

In quick time, the idea of where quick-service eateries might appear snowballed as chains explored any sites with captive audiences—zoos, ferry boats, bowling centers, and more—and the host sites became increasingly more receptive to branded quick-service concepts.

The surging nontraditional world then dovetailed with another industry trend: the local movement. With both host sites and consumers clamoring for local flavors, regional and local independent brands began nudging their way into request for proposal (rfp) meetings alongside the industry’s major players.

Steven Brush, head of Philadelphia-based Brush Enterprises, a consultancy specializing in nontraditional restaurant development, has seen a steady uptick in RFPs from airports, stadiums, and other hosts that are specifically looking for local concepts that can flex their ability to deliver hometown flair. “I believe this is a long-term trend,” Brush says.

The escalating competitive environment has forced national quick-service players to embrace bold, strategic moves. While Boycan says much of Auntie Anne’s earliest nontraditional development happened “without thinking about it,” he says the company is “much more deliberate” about it today.

“It’s about seeking out relationships with the right people,” Boycan says, adding that he’s been in recent RFP meetings in which 200 companies are battling for a single nontraditional space.

To better position itself to win nontraditional deals, Auntie Anne’s has taken some ambitious steps, including creating cobranded units with the likes of Subway, Checkers, and Red Mango, as well as rolling out a redesigned store that softens the company’s customary white-tiled, stainless steel look with warmer tones and a more contemporary design.

“We’ve had to be proactive,” Boycan says, predicting that the competitive environment for nontraditional units will only escalate in the coming years as more brands look to capitalize on nontraditional’s
potential.

Some necessary diligence

For brands looking to make nontraditional inroads, industry insiders say many fail to understand just how different nontraditional development is from its traditional counterpart. Meanwhile, many more struggle to exercise the diligence necessary to assess a site’s profit potential, as well as the company’s ability to provide distribution and field support.

“A lot of concepts have brick-and-mortar restaurants figured out, but learn that translating that expertise into the nontraditional space isn’t as easy as they would’ve hoped,” Weinberger says.

While Dunkin’ Donut’s location at Fenway Park in Boston claims access to more than 37,000 fans for three-plus hours 81 days each year, Burr says, the unit sits empty the bulk of the calendar year. Such recognition, he adds, always enters into Dunkin’s cost-benefit analysis.

“You can be busy for three days and dark for the next seven, so that’s all balanced into the equation,” Burr says.

He adds that Dunkin’ takes each nontraditional site through an approval process in which the company analyzes demographic data for the opportunity.

While traditional development decisions will lean on information such as population and household income, nontraditional development demands quick-service leaders review other metrics. A hospital site, for example, will be judged on its beds, employees, and outpatients, while the number of gaming positions looms large at a
casino location.

“Knowing how many people live within a five-mile radius of the airport or casino won’t do you much good with your analysis of a nontraditional site,” Burr says.

Furthermore, not all airports, universities, or stadiums are created equal, and some nontraditional spots can be fickle environments.

In airports, the decision to move an airline to a different terminal can easily shift an eatery’s fortunes; some college campuses have active student unions, while others are more decentralized; and traffic in a sports arena can be significantly impacted by a team’s winning—or losing—ways.

And whereas traditional store development might include a franchisor, franchisee, and real estate pro, nontraditional development often features the franchisor, a large contractor, and the client or host facility. With contractors and clients in particular, Brush says, there are often various layers of personnel with whom a quick-service company’s representatives need to develop relationships.

“Nontraditional development is 100 percent relationship driven, and that’s something anybody doing nontraditional development needs to know,” he says.

Above all, Brush says, quick-service companies must understand where they want to be in five to 10 years. How many units does the company want and where? How does the company plan to develop longstanding relationships with its target audience? As compelling as the prospective move into a large health-care facility a state beyond the company’s current geographic footprint might be, a brand targeting Millennials might be better served passing on that health-care site to pursue colleges or arenas in its current or adjacent markets, Brush says.

With about 10,000 nontraditional units, Rolfe says, Subway has developed the necessary experience to know which sites make sense and which don’t.

“Sometimes people approach us and have an underperforming location and are convinced a Subway in that spot will change its fortunes,” she says. “We’ve learned that an underperforming unit for them might be an underperforming unit for us, as well.”

Finally, there exists a range of operational challenges in the nontraditional space, such as security, communal storage space, and limited hours of operation, and quick serves frequently need to alter their floor designs, equipment, and menu. Flexibility is a must, experts say, and companies must often bend and shape their concept to fit the nontraditional venue.

“You have to understand that every audience and every space is a little different,” Weinberger says, adding that he will not budge on brand identity or product integrity, no matter how compelling the nontraditional opportunity. “So long as we can have our brand and product intact, we can go down the road of due diligence and see if the financials and operations make sense.”

Appealing as some nontraditional spots might seem, Burr says, discretion is sometimes the better part of valor.

“In some cases,” Burr says, “you just have to say no.”

August 2014

Operators are finding ways to squeeze their brands into every nook and cranny this country has to offer, from schools and hospitals to markets, festivals, and casinos.

Unusual quick service restaurant units locate in high traffic customer locations like casinos.
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Dunkin' Donuts is pursuing growth opportunities in nontraditional units like casinos.
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Just What the Doctor Ordered

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It might seem like quick-serve concepts and hospitals are headed for an epic breakup, as some brands have come under fire for their presence in places meant to heal. The American Hospital Association labeled unhealthy foods “environmental inconsistencies,” whether they’re served out of vending machines, cafeterias, or franchised units in hospital food courts.

But hospital and restaurant experts say there is more opportunity than ever for quick-service brands—that is, for the right quick-service brands. Major changes in health-care financing mean hospitals and health-care systems are eager to open up new revenue streams by leasing restaurant space. Many hospitals can no longer afford to operate their cafeterias in the late-night or early-morning hours, while doctors, nurses, and technicians still need to eat at all hours and usually within a short 30 minutes.

Toni Watkins of Texas Health Presbyterian Hospital in Dallas says the potential for quick-serve concepts that can make a play at healthy eating in this nontraditional space is only growing.

“I think they’ll always have a place, as long as they are the right brand,” says Watkins, the director of food, nutrition, and conference services. “Because, as health care is changing and the cost of doing business is changing, the brands help to give relief to profits that are being lost.”

The Dallas hospital already had a Subway franchise when Watkins joined four years ago. Since then, Au Bon Pain has come on board, and the hospital is gearing up to open its own Chick-fil-A unit. Watkins says the hospital specifically chose those brands because of the healthy options they offer. Even though Chick-fil-A sells fried chicken and french fries, she says, the brand offers an array of lighter options.

Most hospitals are moving away from options like greasy burgers and fries, she adds. But quick serves, even traditional burger concepts, can compete in hospitals by tweaking their menus specifically for the space by paring down unhealthy options and highlighting the lighter side of the menu.

“I think that those [less-healthy] brands would need to go to hospitals and show what they can do with healthy initiatives. It could be that they might be willing to do a different type of branding,” Watkins says. “I think they have an opportunity to rebrand themselves for healthy eating and meet a different kind of need. And let’s face it, a lot of those quick-serve companies have those other menus.”

For hospitals, it’s a tricky balance of meeting demand, promoting healthy choices, and managing their own brand image. Susan Levin, director of nutrition education for the Physicians Committee for Responsible Medicine, says consumers associate a restaurant brand as being healthy just by its presence in a health-care environment.

Hospitals are getting more responsible about the food choices they offer, both in the cafeteria and in name-brand outlets, Levin says, and brands that are willing to promote their healthy choices by offering point-of-sale information about calories, fat, and sodium can be responsible foodservice partners for health facilities. “We know when there is [information], people make better choices,” she says. “So at least give them better information about how to make healthier choices.”

That’s a major reason for Subway’s inroads in the hospital arena. It has fresh vegetables and sandwiches that hold the American Heart Association stamp of approval, and it recently eliminated undesirable ingredients from its breads. The brand also clearly labels nutritional information—a feature more hospitals seek.

“When you look at the [quick-serve] landscape, we have the benefit of having that health halo, so to speak,” says chief development officer Don Fertman. “And certainly when hospitals are looking for [quick-serve] partners, we tend to be one of the go-tos.”

Subway operates in 276 hospitals, including in some of the biggest names in medicine, like Duke University Hospital and Texas Children’s Hospital.

“We have one hospital store that is so busy that there’s one employee who spends their entire time simply baking bread,” Fertman says. “It certainly shows that there is a market there. ... And of course, it’s a captive audience.”

Demand for healthy choices is constantly rising, both in the consumer marketplace and in hospitals. Sodexo is one example of a big supplier for hospital cafeterias that also operates some franchised units in hospitals. Its Mindful line of healthy menu options offers meals and entrées with less than 600 calories and desserts with less than 200 calories.

“With health-care reform, hospitals are wanting to be pillars in their community for health and wellness,” says Sodexo’s Shelley Kalfas, senior vice president of marketing. “They’re all looking to build a culture of wellness that includes a food program.”

In addition to offering healthier alternatives in the cafeteria line and food court, hospitals are working to improve offerings in vending machines and even internal convenience stores. Kalfas says the American hospital is changing from a place where sick people go to get better to a place of complete health, and restaurant brands must find a way to fit into that new image if they want a place in the world of health care.

“I think brands are going to need to, at a minimum, be able to highlight healthier choices on their menus and to have those as a prevalent part of what they’re offering, or it’s just not going to meet the image of health and wellness that hospitals are wanting to present,” Kalfas says.

August 2014

Brands leverage a health halo to serve up better-for-you fare in America’s health-care facilities.

Subway restaurants are located in health care settings nationwide.
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Subway’s fresh veggies and American Heart Association–approved sandwiches make it an obvious choice for hospital foodservice.
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Fresh Bread

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Bread may be the staff of life, but it’s really pretty basic: flour, water, yeast, and salt, or some sort of substitute for the latter two. However, the way these items are combined, as well as other ingredients that are added, can make a huge difference in taste and texture, as quick-service operators are increasingly discovering.

In 20th century America, enriched white bread and rolls filled the aisles at supermarkets and breadbaskets at various restaurants. They were typically made with refined white flour, which also was used to bake buns for sandwiches at quick-service eateries. Not many diners thought much about other types of breads, except perhaps cornbread, primarily in the South, or rye and pumpernickel at delicatessens. Whole-wheat bread often seemed to taste like cardboard.

In recent years, though, much of this has changed, driven by the nutritious attributes of whole grains and the ability of talented artisan bakers to create bread, rolls, and other products from various grains that feature rich flavors and textures.

Bread has become healthier at limited-service restaurants, too. Many operators feature whole-wheat and multigrain breads, while others have lower-calorie items like flatbread.

“Ten years ago, the bakers knew so little about making a good, whole-grain bread,” says Cynthia Harriman, director of food and nutrition strategies for Oldways, a food and nutrition education association, and its affiliated Whole Grains Council. “Today, the whole-grain breads are head and shoulders above what they used to be.”

The Whole Grains Council’s menu symbol, denoting an item containing at least half a serving of whole grains, appears on a number of menu items at limited-service restaurants, including some bread products at places like Arby’s, Jason’s Deli, and Subway.

But while the bakery-café and delicatessen segments have long featured whole grains in bread, the use of these ingredients in other limited-service restaurants lagged.

“For a long time, if you used the word healthy, people would go running for the exits,” Harriman says. But that changed as the items improved, and the percentage of people who ate multigrain items rose to 36 percent in 2009 from just 13 percent in 2006, according to the Whole Grains Council.

Whole grains are just one part of a consumer and operator shift toward healthier breads, a shift that also includes eliminating calories, salt, sugar, and allergens, like gluten.

“There are two opposing trends,” says Elizabeth Freier, a menu analysis editor for Technomic Inc., a Chicago market research firm. “Behind them both is the concept that consumers want to know a lot more about the products—not just bread, but everything.”

Multigrain and whole-grain items are on the rise at limited-service restaurants, according to Technomic’s MenuMonitor menu tracking database. Two-year growth in multigrain items jumped 69 percent, while whole-grain mentions rose 12 percent. Much of the better-bread push into quick-service and fast-casual restaurants occurred after the U.S. Department of Agriculture published guidelines in the middle of the last decade that recommended at least three servings of whole grains daily.

Whole-grain items contain all of the essential parts of the grain kernel—the germ, bran, and endosperm—and all the nutrients of the entire grain, which far surpasses refined flour.

Bread typically hasn’t been the centerpiece of limited-service restaurants’ marketing, but that has changed, Freier says. “We talked a lot about upscaling ingredients like cheese and beef,” she says. “The next step was upscaling the bread.”

Last year, Wendy’s, for instance, launched and heavily promoted multigrain flatbread, pretzel rolls, and ciabatta. Others followed suit, and among the newer offerings were an organic wheat English muffin at Starbucks and sprouted-grain bread at Panera.

Subway’s advertising campaign in May highlighted the fact that its bread is baked daily in the stores and fortified with vitamin D and calcium. Trans fats, high-fructose corn syrup, and an additive also found in plastics were eliminated. The company also reformulated its 9-Grain Wheat sub roll, which now contains 24 grams of whole grains per 6-inch serving, half of the Whole Grains Council’s daily recommendation, says Lanette Kovachi, senior dietician for Subway.

Breads with whole grains have been a hallmark of La Brea Bakery, which helped revolutionize the baking industry. The Los Angeles–based company became the largest artisan bakery in the country thanks to its par-baking process, in which the dough is 80 percent baked and then flash frozen to be finished off later, including at some limited-service restaurants.

Bakers need to make adjustments with whole-grain breads, says Jon Davis, senior vice president of innovation at La Brea Bakery.

“From mixing to shaping, the whole-grain breads are different and a lot less tolerant,” he says. “Whole grains don’t react the same as refined flour. It’s a weaker structure.”

Whole wheat is the most popular bread item chosen by La Brea clients, and there’s also great demand for multiple grains. The whole-grain loaf not only has wheat, barley, and rye flours, but also cracked grains including wheat, barley, rye, oats, millet, corn, and others.

Consumers are also increasingly seeking ancient grains such as quinoa and amaranth, both of which are in La Brea’s George’s Seeded Wheat Oval. “People want to see the whole grains and taste them, to verify they’re in there,” Davis says.

The top specialty bread at Jason’s Deli is the 9-Grain, and the company is testing a 12-Grain variety, as well.

“Whole grain is getting a lot of hype, but the fact is it tastes better,” says Pat Herring, director of research and development for Jason’s Deli. “It’s a richer-tasting bread. You even see parents ordering grilled cheese on it for children.”

Grilled-cheese concept Cheeseboy has featured multigrain bread as an option since the chain launched. It’s part of one of the signature Veggie Melts, along with Cheddar, spinach, red peppers, and red onions, and also included with the breakfast menu’s Morning Melt.

“We see an increasing number of guests choosing the multigrain bread,” says Jeremy Martin, director of procurement for the 11-unit, Boston-based company. “We also have a wheat option, but multigrain is usually the choice.”

The company’s original multigrain bread has been adjusted over the years to include additional grains and seed types.

“People are definitely looking for a healthier option, and multigrain has that overall perception of being a better choice,” Martin says. “When people try it, they come back for it.”

While ciabatta is the main sandwich carrier at Denver-based Modmarket, the 10-unit fast-casual restaurant expanded its use of multigrain bread, which is part of some special sandwiches and served with select soups and salads.

“We began using it as toast for breakfast,” says cofounder Anthony Pigliacampo. “We didn’t want boring wheat toast, and this is not your typical grocery-store multigrain. It’s got lots of seeds and nuts, so it’s a hardy piece of bread.”

Five years ago, featuring multigrain in so many items might have created a pushback from customers. “Today, healthier is moving to the top of guests’ requests,” Pigliacampo says.

The bread includes only flour, water, yeast, and salt, with no preservatives. The flour includes ancient grains.

The Salmon Club sandwich is one of Modmarket’s specialty menu items made with multigrain bread. Between the slices are citrus-grilled, wild-caught Alaskan salmon, bacon aioli, basil, tomato, and arugula, ingredients that “balance well with the bread,” Pigliacampo says.

Another way to get healthier bread is by offering less of it. Potbelly Sandwich Shop, for example, features thin-cut slices with one-third less bread, so it has fewer calories and carbohydrates.

A number of other limited-service companies have added flatbread, which also has fewer calories and carbs. Freshly baked flatbread has long been the signature—and only—bread at Così, which has more than 110 units in the U.S.

“Our original, 400-year-old, European-style flatbread is a very traditional, pure style of baking, made in-house,” says R.J. Dourney, president and chief executive. “Our multigrain flatbread is baked the same way.”

The multigrain version was introduced less than a decade ago, but it’s now being chosen by more than half of Così’s customers, many of them younger, he says.

“When I was in my 20s, I didn’t know anything about nutrition, but today, young people really get it,” Dourney says. “It no longer can just be delicious. It has to be good for you.”

Increasingly, the healthier items taste great, he adds. “Until 10 or 15 years ago, healthy really had a negative halo, because a lot of the food tasted like twigs and stones. But our multigrain is spectacular.”

Pita is another low-calorie bread growing in popularity.

The menu at Chicago-based Roti Mediterranean Grill, which has 19 locations, features pita pockets used as sandwich-like carriers, and pita pieces that are served with salads and rice plates. Baked on the premises, the pita has about 100 calories for pieces and 200 calories for pockets. The salads and rice plates originally came with a large 200-calorie piece of pita bread, but that was reduced because it was too much for many guests.

“We decided to give them the first 100-calorie piece with the meal, and they could get the second one for free,” says Peter Nolan, Roti’s chief brand officer. “If you’re hungry, great, but we’ve made it easier to have a healthier option.”

Mediterranean-style restaurant Zoës Kitchen also has pita pockets—regular and wheat—in four menu items, as well as multigrain bread for regular sandwiches. “Our 12-grain bread, which we position with a lot of sandwiches, has 21 grams of whole grains per slice,” says Kyle Frederick, director of food and beverage for Zoës Kitchen, a Plano, Texas–based, 60-unit chain. “What you won’t find is artificial flavors and colors and high-fructose corn syrup. But we also have a lot of calorie-conscious customers, so our pita pockets have fewer calories but a lot of flavor.”

Nolan says Roti also features pitas in another health-conscious style: gluten free. The company is one of several operators to have gluten-free carriers; others include Jason’s Deli and Smashburger, which both use Udi’s gluten-free breads or buns.

“I had no idea there would be this kind of demand for gluten free,” says Jason’s Deli’s Herring. “It’s become very popular,” not only with diners who have allergic reactions to gluten, but also with many more guests who have a sensitivity to the ingredient, he says. Jason’s Deli takes extra steps to help prevent cross-contamination with items that have gluten by providing employees with kits that include a sterile knife, spatula, and gloves.

Gluten-free items have continued to improve with more flavor and textures that closely resemble breads with wheat.

“Many of them were gritty and dry and lacking flavor,” says Dana Spaeth, vice president and general manager of foodservice and industrial for Boulder Brands, Udi’s parent. “We have a special process, so we make a great bread product.”

Spaeth expects Udi’s to be in an increasing number of restaurants, as operators attempt to appeal to those diners seeking gluten-free items.

“We are engaged with most of the large quick-service restaurants in the country,” he says. “There is more and more interest in serving this large group of diners.”

August 2014

Operators roll out more nutritious breads to appeal to health-conscious consumers.

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Healthier carriers like wraps, whole-grain breads, and flatbreads give quick-service operators more opportunities to improve their menu nutrition.
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Subway, Diet Coke Partner with Taylor Swift for Promo

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Subway and Diet Coke are collaborating to give Taylor Swift fans the once-in-a-lifetime chance to meet the global superstar and seven-time Grammy Award–winning artist, whose new album, 1989, is available for pre-buy online and in stores on October 27. 

“Taylor’s new album is highly anticipated. We know many Subway guests and Diet Coke drinkers are passionate Taylor Swift fans too,” says Tony Pace, chief marketing officer for Subway Restaurants. “That’s why we’re glad to collaborate with Diet Coke, to deliver exclusive access and experiences that fans cannot find anywhere else.”

In the U.S., Subway will bring the Diet Coke program to life through in-restaurant, social, online, TV, and radio promotions. Limited-edition Diet Coke cups will feature Swift’s exclusive likeness. The cups also will carry specially marked codes for a chance to win daily in October a meet-and-greet opportunity with Taylor Swift on her 2015 concert tour.

The new Subway Freshbuzz App, available for download on mobile devices, will also be fans’ go-to destination for exclusive Taylor Swift video content that will be refreshed weekly during the month of October and offer additional chances to win.

To enter, fans can stop by a Subway restaurant to pick up a sandwich and a limited-edition Diet Coke cup, and then visit the Subway website to enter codes found on the packaging, with additional ways to win available via the Subway Freshbuzz App. Each grand-prize winner will receive a trip for two that includes airfare, hotel, transportation, $500, and tickets to a concert on Swift’s 2015 tour.

 

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Apple’s Game Changer

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With Apple Pay, mobile payment could take a giant leap forward.

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Although the concept of consumers using their smartphones to pay for food at limited-service restaurants is nothing new, the mobile payment industry is expected to get a huge boost with last month’s launch of Apple Pay.

The payment service is available with Apple’s new iPhone 6 and iPhone 6 Plus. The mobile wallet allows consumers to pay for goods in thousands of retail locations nationwide, including quick-serve restaurants. Customers pay by simply waving their iPhones near a point-of-sale reader that accepts Apple Pay. Underlying the purchase is a credit or debit card linked to the service.

“People see Apple as a technology and consumer products leader,” says David Matthews, executive vice president and general counsel for the National Restaurant Association. “That they have committed to a mobile payment solution is heartening, because we think it will move mobile payments forward, not only in retail, but in the restaurant space.”

A number of quick-service restaurant brands, including giants McDonald’s and Subway, worked with the technology company to develop Apple Pay. Starbucks and Panera Bread are among those integrating the platform into their existing mobile apps.

Many restaurants that invested in new electronic point-of-sale technology in the past couple of years likely have the capability for Apple Pay, experts say.

“That Apple has committed to a mobile payment solution is heartening, because we think it will move mobile payments forward, not only in retail, but in the restaurant space.”

“If you are one of those merchants that upgraded, you can be happy that your money was not thrown away,” says Jared Isaacman, chief executive of Harbortouch, which provides payment services and technology to businesses. “For those who have not done it, they have to realize there’s going to be a new payment method that they may have to accept.”

Apple Pay’s technology is not completely new, but rather makes more readily available a platform that has already made inroads in the last five years.

“The first thing to remember about Apple Pay is that it is using the traditional payment infrastructure,” says Thierry Denis, North American president of Ingenico Group, which provides payment solutions. “It’s not a way to get people to do something different.”

What Apple did—as it has with many of its popular products and processes—is to take existing technology, integrate it, and make it consumer friendly and appealing.

“Apple created a pretty elegant mobile payment solution,” says Marc Castrechini, vice president of product management at Merchant Warehouse, which provides businesses with payment solutions and technology. “They really tried to take the existing payment capabilities and put them together in a new and unique way.”

Apple Pay uses near field communications (NFC) with a small antenna in the phones to connect payment information to a point-of-sale device. Existing mobile payment platforms, including Google Wallet and Softcard (formerly Isis), also use NFC. These are tied to the customer’s credit cards, which are accessed with a personal identification number.

However, Apple Pay has a two-part hardware security solution. One is fingerprint identification through a sensor on the phone. At the same time, a chip in the device generates a random 16-digit number for each transaction that mimics the credit card number. That number is never stored in the phone and is meaningless to hackers.

McDonald’s expects its integration with Apple Pay will be seamless.

“We’re looking at it as one of our initiatives to really improve the customer experience,” says Julia Vander Ploeg, McDonald’s recently named vice president of digital in the U.S. “It’s an alliance that will benefit millions of customers.”

Apple Pay will provide convenience and quicker service, both in the drive thru, which makes up about 70 percent of McDonald’s business, she adds, and for Millennials, including the 85 percent of 18–24-year-olds who have smartphones.

“Because consumers are relying on technology more, it’s an area we need to be in,” Vander Ploeg says.

Starbucks is already a leader in mobile payment technology, and Apple Pay will give it another arrow in its quiver. Later this year, the company will add Apple Pay as a way to load or reload the mobile wallet tied to Starbucks’ loyalty program, a spokeswoman says.

During a conference call with analysts in July, company CEO Howard Schultz reported that Starbucks had nearly 12 million U.S. mobile application users, and mobile payments accounted for more than 15 percent of all transactions at U.S. company-operated stores.

“By integrating mobile loyalty, payment, and in-store digital experiences, we are creating game-changing technologies and experiences for our customers,” he said on the call.

Panera plans to tie Apple Pay to its mobile app, but is also installing payment terminals in all of its U.S. bakery-cafés to support NFC payments.

Creating apps to link Apple Pay to other loyalty programs would be a boon for other limited-service restaurants, allowing operators to track customer trends and preferences while giving users freebies and special offers, as Starbucks does, Merchant Warehouse’s Castrechini says.

“If you can get a coupon or loyalty program built in, there will be some compelling value added” to Apple Pay, he says. “The big question is whether Apple will go down that road and create its own, or maybe open it up to the Apple development community.”

McDonalds is one major fast food chain to incorporate Apple's new mobile tool.
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Prime Rib Melt Makes Debut at Subway's Canada Restaurants

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Canadians looking for that premium steak house taste need to look no further than Subway Restaurants with the launch of the new Prime Rib Melt. Made with Canadian beef tossed in an au jus glaze, topped with sliced Cheddar cheese, and served on toasted Italian bread, this sandwich is available at participating locations across Canada for a limited time.

“The Canadian beef industry is thrilled to be providing Subway Restaurants across Canada with 100 percent Canadian beef,” says Rob Meijer, president of Canada Beef. “This is a great opportunity for our local producers to showcase their top quality product in a premium quality sandwich.”

To welcome the new sandwich to the team, Subway Restaurants will be helping hockey fans across Canada get primed to cheer on their teams this season. To support the launch, Subway Restaurants is asking Canadians to share their quirkiest pre-game rituals via Facebook and Twitter. From taking a vow of silence to wearing a lucky pair of socks to a handshake that wards off bad luck, players and fans alike tend to have unique pre-game rituals. Fans can share their rituals by following @SUBWAYCanada and using #SUBWAYGetPrimed.

“Whether it is powering up the night before a big game or hours before tuning in, the new Prime Rib Melt allows Canadians to fuel up on premium 100 percent Canadian beef,” said Kathleen Bell, director of national marketing for Subway Restaurants of Canada. "Prime rib is a tender, flavorful cut of beef that is often reserved for special occasions but now Canadians can indulge any time with the new Prime Rib Melt.”

In addition, Subway Restaurants, in partnership with BuzzFeed, will be profiling the top 10 pre-game quirky hockey rituals in Canada. The Get Primed with Subway campaign will also be supported through tailored social media content using #SUBWAYGetPrimed.

Several agencies are supporting the launch of the Prime Rib Melt. Public relations and social media, including the consumer promotion, were developed by Veritas Communications. Television creative was produced by kbs+ and digital media was developed by MMB. All media buying was coordinated by Carat.

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Subway Introduces New Grilled Chicken Strips

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Product is premium cut, all white meat chicken.
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This week’s introduction of new Grilled Chicken Strips—premium cut, all white meat chicken expertly prepared, lightly seasoned, and grilled with no artificial preservatives, flavors, or colors—is the latest example of the Subway brand’s commitment to always improving its menu for consumers.

“A lot of companies seem to be jumping on the ’menu improvement bandwagon.’ At Subway, we have been offering healthier, nutritious choices since our founding 50 years ago and have always been making menu improvements,” says corporate dietitian Lanette Kovachi. “Introducing our new Grilled Chicken Strips is just the latest example of how we are striving to make our products even better—making it easy for customers to not only make choices they can feel good about, but also making those choices delicious.”

After careful review of ingredients to ensure any changes would not impact product and freshness, in 2014 the chain improved the quality of 18 products sold in its more than 29,900 restaurants in North America.

Along with increasing whole grains to 51 percent in the 9-Grain Wheat bread (which now provides 100 percent of a person’s daily Whole Grain requirement per Footlong sandwich), in 2014 the brand also removed artificial colors and flavors, high fructose corn syrup, and bleached flour in many of its products.

“Customers expect Subway to lead the way, and we have no intention of disappointing them,” Lanette says. “Stay tuned for even more changes. Menu improvements are an ongoing priority for us. This is a journey and we aren’t done yet.”

In recent years, the Subway brand has made a number of other dramatic improvements to its menu, including: 

·      Removal of azodicarbonamide in all of its breads (2013-2014)

·      Became the first and only quick serve to meet the nutritional guidelines of the American Heart Association’s Heart Check certification (reducing sodium in FRESH FIT sandwiches by 35 percent, in all sandwiches by 30 percent);

·      Fortified U.S. breads with Vitamin D and Calcium (2012)

·      Reduced sodium content across its entire menu by 15 percent; removed high fructose corn syrup from 9-grain wheat bread and some sauces (2011)

·      Removed artificial trans fats from all core menu items (2008)

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Subway Recognizes Suppliers’ Role In Better Bread

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Sandwich Chain Meets Whole Grain Goals
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The Subway restaurant chain, which started baking bread fresh daily in each restaurant in 1983, recently recognized its three bread suppliers for helping the brand develop its best bread yet.

Lineage Logistics, ARYZTA and Southwest Baking each played a key role in the brand's overall bread improvement efforts as well as helping Subway achieve the specific goal of increasing whole grains to 51 percent in the 9-Grain Wheat bread (which now provides 100 percent of a person's daily Whole Grain requirement per Footlong sandwich).

"We are all about making great sandwiches and any great sandwich starts with great bread," says Mark Christiano, the baking specialist for the Subway chain. "Our most recent efforts were part of our overall commitment to always improve the food we serve. We are fortunate to have partners like Lineage Logistics, Aryzta and Southwest Baking who share our desire to meet consumer demands for higher quality, delicious and nutritious breads. With their dedication and help on our Baking Team, we continue to be the undisputed leader in providing a freshly made and flavorful start to any great sandwich!"

Lineage Logistics, ARYZTA and Southwest Baking were recognized for the countless hours they spent working with the brand to develop new recipes and then to quickly get that bread into the restaurants.

"Southwest Baking is continuously engaged in improving the Subway System, and with the interaction with the Bakery Team, there is a constant focus on maintaining the highest bread quality standards for the franchisees and their customers," says Christian Belzunce, general manager of Southwest Baking.

"It's always wonderful to be recognized for our work, but we are especially honored to have been part of such a critical effort by Subway ensuring the quality and freshness of its delicious breads," says Bill Hendricksen, CEO of Lineage Logistics, a warehousing and logistics company backed by Bay Grove. "We are committed to continuing our work with Subway to help drive growth and enhance consumer satisfaction."

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Multiple Subway Operators to Use New Disinfectant

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New disinfectant from Pure Bioscience showcases at Subway Meeting.

Pure Bioscience Inc., creator of the patented silver dihydrogen citrate antimicrobial, broadened its Subway Restaurants sales and marketing initiative as an invited, preferred vendor presenter at the January 2015 Subway Winter Meeting of Multi-Unit Owners in Miami, Florida.

The conference was attended by multi-unit owners and development agents representing the nearly 27,000 Subway stores nationwide. The development agents are responsible for franchise store growth and managing franchise development.

The benefits of using Pure Hard Surface (PHS) disinfectant on critical food contact surfaces was showcased in the new products/technologies forum. After meeting with multi-unit operators and development agents to discuss and demonstrate the superior antimicrobial effectiveness of PHS, Pure received commitments to order and begin using the product from development agents representing multiple regions.

Cliff R. Wechsler, executive vice president of sales, says, "We launched our Subway sales initiative in Q4 2014 and several regions have placed initial orders. We are very pleased that we successfully built upon that phased rollout at this event, further accelerating our market rollout initiative. We are building momentum, having touched more than 5,000 stores at this conference. We came away with new orders [and] commitments for orders and appointments to hold rollout meetings in the next several weeks with key franchisees. 

"We accomplished our goals—garnering new orders from half a dozen new markets and generating solid new interest representing the potential to gain additional users. More than 20 new markets have requested additional samples and/or meetings with their local franchisees. Pure has educated an ever widening audience about eliminating potential foodborne pathogens, and clearly demonstrated the benefits that Subway stores gain from using PHS."

Wechsler adds, "Feedback from attendees included an appreciation for the relatively low-cost to stores to incorporate an extra layer of protection against norovirus, Listeria, and other pathogens. Store owners understood that our one-step process is a simpler, more effective and environmentally friendly solution to help them protect their brand and deliver consistent results from store to store."

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Subway: A Year In Review

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The Brand's 2014 Growth Milestones
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The Subway brand, comprising the world's largest "family" of small business owners - its franchisees - today revealed several key growth milestones in 2014, including the opening of the 30,000th North American store on the George Mason University campus.

 

Other milestones include:

Opened 2,609 new store locations worldwide

2,000th store opening in the United Kingdom and Ireland (located at the Jarman Leisure Park in Hemel, Hempstead, United Kingdom)

13,000th international location (located in a KOCH department store in Tijucas, Brazil)

Entered three new international markets: Sri Lanka, Mauritius, and Kosovo

Internationally created approximately 22,000 new jobs through Subway franchisees (bringing Subway's total international number to around 434,000)

Named top restaurant concept and fastest growing franchise by Entrepreneur magazine

 

"Last year we were glad to welcome nearly one thousand new franchisees into our family," says Chief Development Officer Don Fertman, who has been with the brand for 34 years and joined the company when just 166 restaurants were opened. "I personally have seen the power of providing entrepreneurs with the opportunity to open and operate their own business and the impact that has on the community. We are proud to continue that longstanding tradition."

Subway currently has 43,500 locations in 109 countries and plans to open an additional 2,500 global restaurants in 2015.

"Our customers can expect to continue to find us where they live, work, and play, and we look forward to another year of exciting milestones as we continue to grow our international footprint," Don says. 

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Data: The Most Important Ingredient

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Selling food for profit dates back to the evolution of human society itself: from outside eateries in ancient Rome and China to the evolution of fine dining in France to the mushrooming of the fast-food industry, drive thru, and takeaway inns in the last decade. Restaurants have changed along with the demands of the consumers. The blurring cultural and demographic boundaries—enabled through globalization and technological advancements—have brought together the culinary varieties of the world. This has also enabled gourmets and food lovers around the world to feast at their convenience—a convenience of time, place, and budget.

Over time, the restaurant industry has moved away from seeking paper feedback in the form of cash and checks to electronic bills and payment methods. Advancements in information and communication technology have also affected the way consumers approach a restaurant and its related activities. While the use of technology has greatly helped increase the reach and scale of restaurants, it has also generated newer areas for restaurateurs to explore and tap into. One such avenue is data analytics.

The landscape of data analytics across restaurant industry

Digital interactions and transactions have opened the floodgates for customer and restaurant data, which can be used in both macro and granular analyses across different levels: customer, restaurant, and market. For instance, restaurants are now anazlying menus to find the most popular dish, customizing coupons for repeat customers, refining discounts to attract new consumers, optimizing inventory planning and replenishment, and doing social media analytics to gauge customer sentiment. However, most restaurants still rely on Excel spreadsheets rather than big data analytics.

A restaurant can test a program in one location and then, depending on its success, choose to apply the program at other locations and across various levels.

Forward-looking companies have tested the waters of big data analytics for overall business benefits. For example, Darden Restaurants uses data to detect fraud, optimize menu prices, and study duration of diner visits. It expects to save big bucks, to the tune of $20 million. The Cheesecake Factory, with more than 180 restaurants in 175-plus locations across the U.S. and three licenced locations in the Middle East, has also started leveraging big data analytics to provide better food and a better customer experience. Subway has also channeled its focus and attention on analytics.

Types of analytics performed or trending in the restaurant space

1. Testing and learning

Fast-food restaurant giant Subway is a staunch proponent of “testing and learning.” In an article by the Wall Street Journal, CMO Tony Pace discussed how marketing innovation is driven by a consistent process of experimentation and how staying ahead is all about coming up with hypotheses and testing them.

In practice, a restaurant can test a program in one location and then, depending on its success, choose to apply the program at other locations and across various levels, including menu, customer, and restaurant. This approach can also optimize operations, pricing strategy, and resource allocation. The test-and-learn approach can be employed to determine the optimal price hike of an item before people stop buying it.

The benefits of this approach can be multifold: It creates a true measure of the performance differential between two or more strategies, it helps control the cost and risks that arise when a new strategy is implemented, and it encourages continuous improvment through its circular process.

2. Menu analytics

Restaurant menus are fertile ground for analtyics. Menus can be evaluated by text appearance (fonts, colors, placement), complementary items, and layout using transaction and order history.

A recent study conducted by Cornell University finds that food items that were highlighted using bold or colored text or that was inside a text box drew more eyeballs and were more likely to be ordered. A few extra words in the description—“succulent Italian seafood filet” instead of “seafood filet”—translated into increased sales. Diners were even willing to pay more for that very dish.

Menu analytics can have far-reaching benefits, whether in identifying complementary menu pairings, creating discounts for winning combinations of such items, or identifying non-performing items and removing them.

3. Customer-level analytics

It is paramount that restaurateurs be able to segment customers using the right parameters and thus, truly understand their customers. Segmentation based on trip involves determining which customers come for just one item, a full meal, or a snack.

Segmentation based on visit pattern examines how customers visit the restaurant at different times of the day. Given these patterns, it is prudent to offer differentiation in menu or customize items for different parts of the day. While certain hot-selling dishes can be sold throughout the day, customers should be infused with the idea of ordering certain dish at certain times of the day.

Segmentation based on demographics encompasses a customer’s age, gender, marital status, income level, and even type of credit card. With these details, operators can easily tailor recommendations and special offers.

With better customer segmentation, designing marketing campaigns and putting customer loyalty programs in place become a piece of cake.

4. Sales analytics

It is a given that all restaurants want to predict demand and sales. By analyzing historical sales trends and taking into account seasonal variances and other constraints, restaurants can effectively do that. These analyses empower restaurateurs to optimize their inventory and better forecast demand swings. The data can also optimize staffing by considering shift preferences and maximum-hour limits for crew members.

When combined with location-based analytics, sales analytics can be taken to a whole new level. By combining primary and secondary data on restaurant sales, companies can also analyze the sales of other restaurants in the same vicinity. This comparison can benchmark one’s own performance against competitors and identify the factors responsible for any sales dips.

5. Promotional and feedback analytics

By combining reviews, feedback, and social media data, restaurant managers can effectively evaluate and gauge their service levels. These analytics can also help them understand whether customers are receptive to special offers, and if so, which ones. Furthermore, managers can identify the key influencers by running algorithms. Instant feedback from analytics also allows for timely intervention in resolving customers’ complaints and preventing poor impressions. Analysis on cumulative data can also unearth hidden insights which otherwise could be missed, such as which food item is losing its popularity or which particular food chain is receiving negative remarks and for what reasons.

Given that the restaurant business has low margins but is cash-intensive, analytics can offer a definitive business advantage. While the aforementioned techniques are just a starting point, organizations stand to benefit by making analytics integral and pervasive in their ecosystem.

With the right ecosystem in place, restaurants can look to people with the right analytical tools and techniques to sieve through data and draw actionable insights. Across the spectrum, the analysis should be: descriptive, or telling them what happened or is happening; inquisitive, or helping them understand why it’s happening; predictive, or informing them of what’s going to happen; and prescriptive, or giving clear recommendations for next steps. These efforts all become futile if companies discount the importance of real-time decision-making on the basis of insights generated. This is perhaps the most critical part of the whole analytics equation.

As Apprentice Leader at Mu Sigma, Sumit Prasad provides analytical solutions to Fortune 500 clients, leveraging cross-industry learnings to ideate, innovate, and provide thought leadership. He has a bachelor’s degree in Statistics from Delhi University and a master’s degree in International Management from IE Business School. Follow him on Twitter: @sumit_pd
February 2015

How data analytics can take your restaurant to the next level.

Quick service brands can use big data to plan strategic growth.
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Subway Rewards Customers For Wi-Fi Logins

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New Partnership With Turnstyle Solutions For Loyalty Program
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Turnstyle Solutions, a company that helps businesses monetize their Wi-Fi, has formed a new partnership with Subway Restaurants. Customers need only opt-in to the Wi-Fi network at any Subway location in Northern Ontario, Canada, to be rewarded for being a valued customer.

“After 50 years in the marketplace, we haven’t forgotten our most valuable asset, our customers. We are constantly looking for ways to enhance the experience in store.  Turnstyle’s technology was appealing because it evolves the way that we can interact with our consumers, providing a platform for direct communication and a new innovative reward system for our patrons, all through the Wi-Fi,” says Steve Beaudry, board chair of the local Subway Canada Franchisee Advertising Trust.

As an early adopter of Wi-Fi enabled location-based marketing, Subway is demonstrating an interest in gaining a deeper understanding of the needs of their customers. To kick-off the initiative which began on February 24, Subway is giving away a free, 6-inch sandwich to every guest who logs into their Wi-Fi at participating locations in Northern Ontario. After joining for the first time, guests are pushed an in-store notification, containing a coupon to redeem a 6-inch Subway sandwich of their choice, as a way to show appreciation for their loyalty to the brand. Once customers have opted-in, the network remembers them and each subsequent visit could offer them additional rewards.

“We are constantly seeking innovative tools to add to our clients bottom line, by aligning communication objectives and authentically engaging with their users. Turnstyle was a perfect fit,” says Melissa Gallagher, vice president of Twist Marketing. Twist Marketing leads the marketing initiatives for the Northern Ontario Subway region.

Providing access to public Wi-Fi in hotels, restaurants, gyms, retail locations, and any space where potential consumers are spending time has become necessary. Turnstyle Solutions works with brands to help them enhance their Wi-Fi service, enabling them to create customized campaigns triggered by location, loyalty (number of visits), date, or demographic information. The Social Wi-Fi feature attracts and identifies customers, while boosting awareness through social platforms. Turnstyle Campaigns,such as the Subway experience, provide one-to-one customer engagement and amplify retention and spending. At the same time, the Analytics feature allows clients to accurately track the success and ROI of various marketing activities and collect valuable foot traffic information to help them better understand their customer.

 

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The Whole-Grain Way

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Operators promote whole-grain foods on Whole Grains Sampling Day.

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Whole-grain products are no longer a niche part of the foodservice industry. Seventy-two percent of consumers want more whole-grain products from restaurants, according to a 2014 International Food Information Council survey. And some 10,000 food items with the whole-grain stamp brought in $9 billion worth of sales in 42 countries in the year ending October 2014, according to data from market research firm SPINS.

Now whole-grain supporters are trying to get quick-serve customers to be more familiar with the foods. The Whole Grains Council, a program of the Oldways Preservation Trust, is celebrating the fourth Whole Grains Sampling Day on April 1. This nationwide event partners with health professionals, whole-grain food manufacturers, and the foodservice industry to introduce customers to whole grains using social media, in-store brochures, posters, and, of course, whole-grain food samples.

Kelly Toups, program manager of the Boston-based Whole Grains Council, says developing eye-catching whole-grain choices is essential for the quick-service industry today as more customers incorporate whole grains into their diet. And Whole Grains Sampling Day, she adds, is a great way to increase whole-grain awareness among customers.

“From the quick-service perspective, there’s a lot of different ways that these restaurants could get involved,” Toups says. “The biggest ways that quick-service restaurants in particular have been involved is through coupons [and] social media.”

Several limited-service brands are participating in Whole Grains Sampling Day. McDonald's USA is planning to tweet about menu items made with whole grains, such as the Egg White Delight and Fruit & Maple Oatmeal. Panda Express will use social media to promote its steamed brown rice.

Carlsbad, California–based Rubio’s plans to offer guests $1 off any two-taco plate served on stone-ground corn tortillas or burrito served on whole-grain tortilla.

“For the quick-service industry, it’s relatively easy to get that whole-grain option. They just have to make customers aware of it and show them that it tastes good.”

“We’ve found that our customers enjoy healthier options and the ability to choose from more than one type of tortilla,” says Ralph Rubio, cofounder of Rubio’s Restaurants Inc., via e-mail. “In addition to featuring stone-ground corn tortillas on most of our tacos, we offer guests the option to substitute a whole-grain tortilla on any of our burritos as a replacement for flour tortillas.” 

Subway is inviting bloggers and “health influencers” to one of its Boston-area stores to share whole-grain samples and to discuss its commitment to including whole grains in more of its products. Nationally, the brand will use Twitter and Facebook to reach out to customers with whole-grain education and to encourage customers to visit local stores on Whole Grains Sampling Day.

Lanette Kovachi, dietitian for Subway, believes quick-service restaurants can use the power of association to connect with customers and help them better recognize whole-grain options. It’s something the grocery-store industry has thrived on, she says. “One thing that definitely helps is using the whole-grain stamp,” she says. “I think that symbol is becoming more and more recognized as we see it in the bread aisle on lots of different breads.”

Subway highlights its whole-grain bread options at customers’ point of purchase. A sign details bread options like the 9-Grain Wheat and 9-Grain Honey Oat breads. Each is identified with the whole-grain stamp and lists what whole grains it contains.

Toups points to P.F. Chang’s China Bistro and its fast-casual spinoff, Pei Wei Asian Market, as having a simple yet effective tactic of highlighting whole grains: Employees give diners the option of brown or white rice. She says the chain reported brown rice selling 45 percent of the time with this technique.

“It’s really trying to get more people to choose that option, or to even let people know that it’s available and really get the excitement there,” Toups says.

For quick-service restaurants that don’t yet offer whole grains, Toups says, there are plenty of time-conscious options that exist. Quinoa, for example, does not take much time to cook. Other whole grains she suggests operators could consider include farro, amaranth, millet, sorghum, barley, and teff. Introducing a new whole grain such as teff, she says, gives operators an opportunity to add global foods to the menu. Teff is traditionally used in Ethiopian cuisine, she says.

“For [the quick-service industry], it’s relatively easy to get that [whole-grain] option,” Kovachi says. “They just have to make customers aware of it and show them that it tastes good.”

Brandon O’Dell, owner of O’Dell Restaurant Consulting, believes that some quick serves have an easier time with whole-grain offerings than others based on their menu category. Subway, for example, has an easy entry point with its deli sandwiches. But menuing and promoting whole grains helps to give quick-serve brands a healthier overall image.

“It’s a lot healthier option than eating a quarter pound or third pound of hamburger and french fries somewhere,” O’Dell says.

Quick service restaurant chains promote whole grain menu items.
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As part of Whole Grains Sampling Day, the Whole Grains Council is offering promotional materials to help operators showcase the ingredients.
Operators promote whole-grain foods on Whole Grains Sampling Day.
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