Contributing Member of the Consumer Goods & Services Councils

GLG News by this Author

High Stakes Burger King Remodel Work In Progress

October 9, 2009

Analysis of:Burger King's New Restaurant Design | councils.glgroup.com

Burger King (BKC) needs some big news to reverse recent same store sales declines. It has long been considered a class b operator, with substandard sites and buildings. It has highlighted its so called 20/20 remodel template. Since BKC is about 90% franchised, it must go forward carefully with required big investments since capital market access is difficult. In addition, the size of the investment--$300 to $600K, will be it difficult to grind out a payback quickly.

What's the Story with Starbucks Price Increase?

August 24, 2009

Analysis of:Starbucks Price Increase: Will the Consumer Pay More? | www.nytimes.com

Did Starbucks really execute a price increase, or was it another goal? We feel the action was more of a rebalancing, and was done to protect margins, in the out periods.

Jamba: Food Expansion Will Take Time

August 24, 2009

Analysis of:Jamba Juice Launches Food Menu | www.suntimes.com

With a new CEO and management team in place, Jamba is working to expand its menu offerings so it is not perceived as a "snack only" destination, and to generate incremental profit flow-through. While we give the new team credit for trying, expanding into a non-core offering will be the most expensive and time consuming pathway to success.

Fast Food Fading: Not Quite

July 28, 2009

Analysis of:Fast Food Fading? | www.forbes.com

The Forbes article overstates the QSR sector slowdown. Their relative customer traffic position has faded even since 2008 (which was not a good year), but it is not true to indicate that nothing is working. One must examine the components of same store sales to see the pieces. The business press often focuses onto bumper sticker phrase analysis. In general, new news, product/value and strength of the marketing plan are essential elements for any kind of traffic stability.

Tim Horton's vs. Dunkin: long way to go

July 15, 2009

Analysis of:The Morning Doughnut? The Choices Are Getting Complicated | www.nytimes.com

Building a restaurant chain in a new market takes alot of time and effort.   Re-franchising from one brand to another might be a fast way of building QSR market share. CIT's survival is important to the franchisors.

Chain Restaurant Discount Strategy: Details Matter to Franchisees

June 24, 2009

Analysis of:Chain Restaurant Discounting: whats going on? | www.nytimes.com

With price and value being key to driving and retaining chain restaurant sales and traffic, special care and attention for franchisees is required. Franchisees don't have the same resources company operations do, and are sensitive to the discount heavy strategy some restaurant franchisors are working.

Chain Restaurant Topline Sentiment

April 7, 2009

Analysis of:GLG News - Council Member Homepage | www.nytimes.com

While there has been a recent run up in restaurant stocks, the underlying consumer sentiment and spending trends in the marketplace aren't as positive in tone, yet.   However, eventually, the restaurant sector will begin to lap some ugly  sales trends that began in June 2008 and then really fell off the earth in September, 2008. 

Restaurant Development Will Slow in 2009

January 15, 2009

Analysis of:Franchisees May Shut 10,000 Sites in 2009, Group Says | www.bloomberg.com

Driven by the recession and tighter credit terms, restaurant new unit development will slow in 2009.   Some weaker operators will have unit contraction, for the first time in decades, particularly those franchisees that feature single unit operators (mom and pops). The chief opportunity for future development will be outside of the US.

Restaurant Casual Dining Sector: economics, valuation and the future

December 22, 2008

Analysis of:Casual Dining Notes: Brinker and Darden | www.forbes.com

News last week from Brinker and Darden give several clues as to how the casual dining sector is evolving, and what new M&A metrics exist. In particular, todays restaurant sector economics puts a premium on restoring and renovating existing restaurant concepts.  

recession, discounting and restaurant demand for commodities

December 16, 2008

Analysis of:More restaurants serve up promotions for these lean times | www.orlandosentinel.com

Factors driving the restaurant business right now are influenced by both macro and micro factors but the overall level of confidence and retail activity is the limiter on topline sales. Food commodity cost increases are a complicating, second factor, and the major influence on the cost structure.

Do what it takes

December 10, 2008

Analysis of:Fresh Palates for Burger King | online.wsj.com

Burger King, and indeep all restaurant and retailer operators, must do whatever it takes to get sales moving and maintained.

Restaurant menu pricing plays

December 3, 2008

Analysis of:McDonald's to Raise Burger's Price | online.wsj.com

McDonald's new McDouble is a defensive menu play, but needed, and shows how McDonalds stays at the top of the chain restaurant game.

Sonic Company Store Performance: check out the marketing plan

October 27, 2008

Analysis of:Sonic Corp (SONC): Whats up with the company unts? | www.sonicdrivein.com

Sonic Driveins are reacting to the difficult environment, and sales shortfalls in their company stores. They recently announed a re-franchising (sale of company units)  thrust, and many other actions. Yet, the fix might be as simple as reworking the marketing plan.

Sonic (SONC) Refranchising: Many Moving Pieces

October 6, 2008

Analysis of:Sonic: Refranchising Push | reno.wsj.com

Sonic's recently announed refranchising push displays many of the issues underway facing the chain restaurant sector. Careful analysis is necessary to execute the plan.

Food and other Cost Inflation Effects on Restaurants

September 19, 2008

Analysis of:Olive Garden and Red Lobster to raise prices- Parent company announce bigger than usual increase to investors | www.msnbc.msn.com

While the end of food inflation is not at hand, restaurants must manage the price/value/promotion relationship cafefully. New factors have emerged this week that will affect restaurants. Some restaurant companies will have earnings shortfalls later in 2009.

Recent DineEquity Meltdown Predictable

September 11, 2008

Analysis of:DineEquity Meltdown Predictable | biz.yahoo.com

The DineEquity meltdown is symptomatic of the risks of doing business predicated on financial engineering. Stock price and The Street were slow to pick up on the risks on this business.

Spicy Pickle: way too early

October 15, 2007

Analysis of:Spicy Pickle(R) Serves Up Its Initial Public Offering | money.cnn.com

 Need alot more analysis before telling whether this or any other new restaurant IPO will make it. It's all about unit level economics What is the franchising plan?

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