Magic Number 5

Increasing gas prices, food costs and taxes are resulting in less disposable income for the American consumer to spend on food away from home. Many restaurants are focusing marketing efforts on the value of their food, mailing coupons and even lowering prices.

Many quick-service restaurants are using permanently lower-priced, regular menu items to draw consumers, and the magic number seems to be five. Five dollars is the way to go across competitors. Subway began the practice with its “$5.00 Foot-longs” promotion, which comprised a foot-long Subway sandwich for only $5.00 all of the time. This promotion is now a permanent fixture on the Subway menu. 

Quiznos quickly followed in Subway’s footsteps and now offers $5.00 large, toasted sandwiches. Quiznos boasts that consumers get more food and flavor for their money when buying a Quiznos sandwich vs. the competitor. Pizza restaurants are also jumping on the $5.00 bandwagon. Pizza Hut created Pizza Mia Pizza, three or more one-topping pizzas for $5.00 each, 365 days per year. Little Caesar’s also offers a $5.00 pizza.

A Grape New Trend

Traditionally regarded as a popular, sweet hand-fruit, grapes are most commonly served in their natural form as a light side dish substitution on restaurant menus. However, restaurants are redefining the use of grapes.

According to Mintel Menu Insights, grapes (unspecified), red grapes, concord grapes, muscat grapes, grape sauce and dried grapes (yes, raisins) are becoming increasingly popular on the restaurant menu in sweet and savory dishes, as well as beverages. Grapes are being frozen, roasted, marinated and muddled. Magnolia Grill serves Brown Sugar Sour Cream Panna Cotta with oven-roasted grapes and hazelnut biscotti. Dylan Prime puts its spin on Grape Crush by mixing Bacardi vanilla rum, freshly muddled red grapes and a splash of Parfait Amour.

Dried Grapes—otherwise known as raisins—are adding depth of flavor to menu items. Sanford Restaurant serves a warm Chocolate Espresso Cake with espresso-soaked raisins, mocha cream and vanilla ice cream. Gotham Bar and Grill sweetens its Curried Pumpkin Soup with golden raisins, Beluga lentils, cumin-scented apples and a lime yogurt emulsion.

Classic Po'Boys

The po’boy sandwich is a New Orleans classic. Varieties of fried catfish, oysters, shrimp and calamari flood the menus of New Orleans. While sandwiches, in general, are immensely popular in other areas of the U.S., po’boy sandwiches are just picking up steam. In 2007, well-known restaurants, including Champps Americana, McCormick and Schmick’s, and Spago Las Vegas, added the Cajun tradition to their menus.

McCormick and Schmick’s added a traditional Oyster Po Boy Sandwich with Cajun remoulade, and Spago Las Vegas has introduced a Shrimp Po Boy on a hoagie roll with butter lettuce, pickled red onions and tartare sauce. Chammps Americana put a unique spin on the po’boy by making it a salad. Chammps took the best part of a po’boy and tossed it with fresh-chopped lettuce, corn, crunchy green beans and hearty-cut tomatoes, along with diced red onions, cucumbers and julienned carrots. It is topped with candied pecans and a spicy coleslaw dressing to bring the flavors together.

C the Opportunities

The increased gas prices are affecting more than just consumers; c-store operators are also feeling the pain. With gross margins on fuel hovering around 5%, many c-store operators are taking a fresh look at their foodservice programs, where margins are easily over 40% and may exceed 60%, explains Technomic Inc.

Foodservice remains a small percentage of total c-store sales. However, higher gas prices may actually help c-store operators grow foodservice sales. “Consumers are much more interested in reducing their driving,” explains Tim Powell, convenience store foodservice program director at Technomic. “A trip to the gas station may be unavoidable, but now consumers are more likely to also pick up a quick meal or a snack at a c-store and avoid another stop.”

According to the Technomic study, when consumers are hungry for a meal, convenience stores typically fall behind restaurants and grocery stores as a top-of-mind destination. However, when asked about snacks, most consumers think of c-stores ahead of all other venues.

The study identified many opportunities for traditional foodservice suppliers to provide expertise in a channel that has historically behaved more like retailers than foodservice operators, including snacks, beverages and meal items. While the major chains (1,000 units or more) hold most of the industry’s foodservice share, mid-tier chains (10 to 1,000 units) account for 23% of all units and nearly a fifth of all c-store foodservice industry sales.

“These chains are often easier for suppliers to target and penetrate, particularly since there are fewer management levels and fewer competitors,” says Powell. “Any food or beverage supplier that can help implement a branded solution, even if it’s just for one product category, is likely to find success.”

For more information on the Technomic study “Target: C-Stores, A Growing Opportunity on the Foodservice Landscape,” contact Tim Powell, 312-876-0004, ext. 3704 or tpowell@technomic.com.