McDonald's addresses C8 concerns: According to the News and Sentinel (W.Va.), McDonald's corporation officials confirmed that a C8-related chemical is widely used in fast food packaging throughout the industry. C8 is a key ingredient in the manufacture of Teflon, and has been the subject of a class action lawsuit against DuPont. The Environmental Working Group asked nine fast food chains, including McDonald's, to release information about the chemical coating of packaging used in their restaurants. The Ohio Citizen web site has a history of C8 news and litigation.
Entrepreneur.com today prints this short piece on "secrets of success" in franchising.
Second-quarter reports: 7-Eleven experienced both revenue and sales growth in its report of second-quarter finances. The Applebee's chain reported lower second-quarter earnings, largely due to a one-time charge related to its sale of the Rio Bravo Brand in 1999.
Shakey's names new Executive VP: In a release yesterday, Shakey's Inc. announced that Sonia Barajas-Najera, formerly a controller and corporate director, will now serve as the company's Executive Vice-President and Chief Operating Officer.
Discrimination suit filed against Cracker Barrel: A lawsuit was filed Wednesday against Cracker Barrel Old Country Store in which twenty-three black patrons of Arkansas Cracker Barrel restaurants alleged racially discriminatory treatment. The plaintiffs' attorney claims that a similar lawsuit filed in Georgia last year points to an "insidious" pattern of discrimination.
Dollar Thrifty to purchase major-market franchises: Under a deal announced Tuesday, Dollar Thrifty Automotive Group, Inc. will buy 16 of its Thrifty franchises in an effort to boost revenue. Dollar Thrifty's president commented, "The strategy, simply stated, is to operate the larger stores corporately and continue to franchise the medium and smaller markets."
Fantastic Sams sold in bankruptcy: Thanks to the decision of a California bankruptcy court, a group of entrepreneurs is set to acquire hair-care franchise Fantastic Sams for just over $17 million. The entrepreneurs, who own New England franchise rights for the chain already, represent Cheveux Acquisition and expect to close on the purchase August 4th. Full story at Reuters.
Papa John's second quarter: Yahoo! Finance has a detailed report on Papa John's second-quarter reportings, which show a decrease in both revenues and sales.
Sales up, profits down for McDonald's: McDonald's yesterday said that their second-quarter profits fell 5.3% due to increased advertising spending; however, sales increased significantly, hitting a five-year high. Bloomberg comments on the chain's salad campaign (see earlier W&D blog entry), expansion plans and McDonald's sales in the European market.
Pizza Hut goes low-fat: Pizza Hut plans to shave 43% of the fat content off a slice of its pepperoni pizza this fall in addition to offering salads. A Pizza Hut in Fort Wayne has already been testing the use of soy cheese for more than a year on its "Lite Bites" menu.
Upscale trend helps Taco Bell: Taco Bell's sales have increased, reports the Mercury News, due in part to the addition of more upscale, pricier items on its menu. The article notes that "Taco Bell has quickly gone from the weakest to the strongest of the fast-food chains owned by Louisville, Ky.-based Yum! Brands, Inc."
Variety in franchising: Though franchising's earliest (and still likely most prominent) impact was in the food industry, other businesses are taking advantage of the concept. The Sun-Sentinel (FL) writes about franchises in housecleaning, detective work and even the control of liquor flow in restaurants and bars.
Backyard Burgers Reports Record Revenues, Dropped Earnings: Memphis-based Backyard Burgers, operator and franchisor of quick-service restaurants, reports a second-quarter revenue increase of 10.8% over the same quarter last year while its earnings per share fell 18%. The franchise system currently has 128 stores and plans to open 11 more stores this year.
Three Louisville Restaurant Owners Join Forces to Create Franchise: Tony Boombozz Pizzeria, Bazo's Fresh Mexican Grill and Benny B's Famous Sandwiches, three local Louisville restaurant concepts are combining into a company known as Cool Eats, Inc. Cool Eats will hold the "master franchise agreement" for the three food concepts. The company looks to open five new units in the next year.
Bennigan's to Expand Into Major Markets: According to Entrepreneur.com, Bennigan's Grill and Tavern, the franchisor and operator of more than 300 Irish-themed restaurants, announced the opening of six more restaurants in Memphis alone, as well as further expansion in ten other large American cities. See the Portland Business Journal for details regarding the Portland expansion.
Sylvan looking to sell adult tutoring franchise: Sylvan Learning Systems, Inc., announced on Thursday that it is seeking a buyer for its Wall Street Institute franchise, which tutors adults in English. Sylvan had hoped to use the franchise to boost European and Latin American business but did not receive the return expected.
Salads a boost for McDonald's: The McDonald's campaign to introduce salads to its menu has proved to be both a profile and a profit-booster. Since the salads appeared in March - with Paul Newman doling out the salad dressing at the Times Square debut - flagging sales have disappeared. Bloomberg notes that "shares of McDonald's have surged 33 percent this year, making it the fifth-biggest gainer among the 30 companies in the Dow Jones Industrial Average."
Burger King bankruptcy: 28 Burger Kings in Kansas and Nebraska have filed for Chapter 11 bankruptcy in an effort to reorganize some $30 million worth of debts. MSNBC cites national management changes within the Burger King company structure as well as difficulties with marketing and sales (including the recent Coca-Cola lawsuit; see earlier W&D blog entry) as a spur to the filing.
Marriott settles with hotel owner: A settlement between Marriott International and the owner of a West Virginia hotel is expected to be announced today. In Town Hotels of Charleston, W.Va. sued the hotel chain in May of last year, accusing them of unfairly permitting two competing Marriott-branded hotels to open in Charleston. According to the New York Times, Marriott recently settled similar suits and currently faces two others. The terms of settlement are as yet undisclosed, but Marriott will lend $1 million to In Town to renovate its 352-room hotel.
Yum! appoints new health officer: In response to increased awareness of and sensitivity to obesity in the U.S., Yum! Brands has created a new corporate role -- "chief scientific, health, and regulatory affairs officer." Dr. Al Baroudi, appointed to the new position, is charged with overseeing the development and execution of programs for scientific and regulatory trade for all of Yum! Brands' worldwide business, as well as managing health, nutrition and animal welfare issues.
Internet access to be franchised in NYC restaurants: U.K.-based EasyInternetcafé, which operates net-access outlets, has signed its first franchisee in New York City after debuting there in 2000. The chain has a store in Times Square and has also placed terminals in New York restaurants including Cafe 101, whose owner now plans to run his 39-terminal operation as a franchise. Article at Crain's New York Business. Forbes also profiles Stelios Haji-Ioannou, founder of EasyInternetcafé's parent Easygroup, and discusses his work with franchising.
IHOP restructures: IHOP announced plans to shift focus from restaurant development to franchise support. The company seeks to expand its chain by encouraging franchisees to open restaurants in new or expanding markets.
California Pizza Kitchen CEO resigns: California Pizza Kitchen Inc. yesterday announced that Fred Hipp, President & CEO, has decided to resign from the company effective immediately. Co-founders Richard Rosenfeld and Larry Flax will assume leadership of the company (which they jointly held from 1985 at the company's founding through 1996). Press release at BusinessWire.
New York smoking ban goes live and draws lawsuits: A statewide smoking ban takes effect in New York today. WNBC in New York reports that two groups -- the Empire State Restaurant and Tavern Association and CLASH (Citizens Lobbying Against Smoker Harassment) -- announced lawsuits to question the constitutionality of the ban. The state health department has posted on its web site the full text of the Clean Indoor Air Act, guides for the public, compliance information for restaurant and bar owners and even suggested signage.
McCartney joins PETA effort against KFC: People for the Ethical Treatment of Animals has brought Paul McCartney into its fight against what PETA claims is KFC's unethical treatment of its chickens (see earlier W&D blog entry). McCartney's open letter to David Novak, chairman and CEO of KFC's Yum! Brands Inc., will appear in a full-page advertisement in today's edition of the Louisville Courier-Journal (KY). Yum! responded, "KFC is committed to the well-being and humane treatment of chickens. While PETA would prefer a world of vegetarians, most people disagree, so we think PETA should follow one of Sir Paul's songs and just 'Let it Be.'" Full story and image of McCartney's ad at CBS News.
McDonald's goes wireless: Earlier this month, McDonald's expanded its pilot wireless internet program to include 55 outlets in the San Francisco area. Ten New York restaurants already offer the short-range wireless network service, casually known as "WiFi," and the chain hopes to offer access at several hundred locations, including Chicago, by the end of the year.
AFC involved in audit: AFC Enterprises, Inc. yesterday reported that its board of directors has launched an independent investigation of its quarter-end adjustments at the request of the company's independent auditors. The investigation aims to determine if the adjustments were recorded properly (and if not, why not). AFC, the parent company of Popeyes Chicken, Church's Chicken, and Cinnabon, is facing delisting of its stock due to its failure to meet an SEC filing deadline for its annual report (see earlier W&D blog entry).
Salmonella outbreak at a Chili's Restaurant spurs lawsuit: Reported salmonella victims who became ill after an outbreak at a Chili's in Vernon Hills, Illinois filed a lawsuit Friday against the restaurant's parent company, Brinker International, Inc. The plaintiffs' attorney notes that the outbreak in question has infected a confirmed 103 people and a suspected 152 others. According to this article, the outbreak is believed to have been caused not by food products but rather by an employee's failure to use proper hand-washing techniques.
The Legislative History of Franchising: A discussion of the origins of franchising and the evolution of franchise regulation appears in "Franchise Regulation - Past, Present and Future" at Entrepreneur.com.
Hotel franchisors report mixed second-quarter results: As part of a finance report, the Washington Post reports that Host Marriott's second-quarter revenue fell some 8 percent, largely due to decreased occupancy and room rates. Host Marriott owns hotels with the Marriott, Hilton, Hyatt and Ritz-Carlton names. Silver Spring-based franchisor Choice Hotels International, Inc., by comparison, reported second-quarter growth.
Circuit City Arbitration Clause Struck Down: The San Francisco Chronicle reports that the 9th Circuit Court of Appeals yesterday struck down the arbitration agreement used between Circuit City and its employees, ruling that the clause forces employees to waive their right to sue in order to keep their jobs. This ruling follows other 9th Circuit rulings with respect to arbitration clauses in employment contracts. The court concluded that the employees were pressured into the arbitration agreements because they lacked bargaining power to refuse to sign the employment contract. The decision may be accessed via the 9th Circuit web site.
The hazards of brand saturation: Alissa Quart, in the New York Times' op-ed section, comments on brand sponsorship of school activities, junk food products in schools and recent trends in the education/business intersection. "On July 1, Kraft Foods announced that it would withdraw its advertisements for processed foods from the in-school television station Channel One. A week before, New York City's Education Department banned soda and candy from the vending machines of its public schools. The department's action came on the heels of similar measures by school districts in San Francisco and Los Angeles."
Despite obesity lawsuits, burgers are back: QSR Magazine publishes "Upscaling the Burger," about the resurgence of the burger's popularity, due to everything from Americana to the Atkins diet.
Pizza Hut-Pasta Bravo cobranding put into action: Yum! Brands has plans to open its first co-branded Pizza Hut/Pasta Bravo restaurant in Clarksville, TN this fall. The menu, including Pizza Hut pizzas as well as pastas and salads, will be offered in a more casual-dining atmosphere than at typical Pizza Hut restaurants.
Cendant earnings climb: Cendant, franchisor of hotel, rental-car operator and real estate brands, reports a significant climb in its second-quarter earnings. Smart Money writes that Cendant "reported net income of $382 million, or 37 cents a share, compared with year-earlier net of $7 million, or a penny a share."
Who is to blame for obesity? Overlawyered.com's Walter Olson quotes a Gallup poll taken earlier this month stating that "nearly 9 in 10 Americans (89%) oppose holding the fast-food industry legally responsible for the diet-related health problems of people who eat that kind of food on a regular basis. Just 9% are in favor. Those who describe themselves as overweight are no more likely than others to blame the fast-food industry for obesity-related health problems, or to favor lawsuits against the industry."
The Financial Times writes, "In America, It Takes Lawsuits to Change Lives."
A cousin to obesity lawsuits has meanwhile emerged in the UK, where a case is to be brought in Glasgow by alcoholics claiming that the drinks industry failed to warn them of the dangers of alcoholism. Full story at the Daily Record; the Washington Times reports locally.
Obesity lawsuit update: The Senate's web site provides the text of Sen. Mitch McConnell's floor statement on the Commonsense Consumption Act, which aims to protect food manufacturers from obesity lawsuits (see earlier W&D blog entry).
McDonald's becomes target of internet scam: A false coupon for a free salad at McDonald's has been distributed via email and the Internet; the company says it has no way of knowing just how many have gone out, but the coupons have already been showing up at McDonald's restaurants around the country.
Sushi restaurant sued for student illness: A lawsuit was filed on Friday in King County (WA) Superior Court against Todai Franchising LLC of California, which franchises and operates sushi restaurants, seeking unspecified damages for a high school student who became ill after eating at the restaurant. The lawsuit claims that the health department found 14 patrons and 8 employees became sick at the Todai restaurant during the week of August 12 last year and also alleges that Todai produced food unfit for human consumption in violation of state product liability laws. The restaurant, located in Redmond, Washington, is owned and operated by the franchisor.
New careers in franchising: MSNBC follows former corporate executives into their new careers in the piece "Former Execs Go Franchising." The piece discusses the required initial investments, the push to open multiple locations as a strategy for profitable franchising, and the transition from corporate life into franchise operation.
Green Mill expanding: Green Mill restaurants, a casual-dining chain native to the Midwest, is both expanding its franchise base and beginning to sell its products in the retail market. The company, dating back to 1932, faltered in franchising in the 1980's but put its energy back into franchising in 1990 in a push for growth.
Franchising fireworks: David Macklin's Lantis Fireworks is looking to franchise its business across the nation and into Canada, according to the Las Vegas Review Journal. Macklin hopes the unique nature of the business will help it in the franchise realm; he also points to the effectiveness of franchising in the fireworks trade: "It's very difficult for a company to be based in, let's say, Dallas, and for them to keep up with the speed of the local regulations in Las Vegas. If you're not in a local market, it's hard to keep in touch, but our franchises will have that covered."
McDonald's stock on the rise: According to the Washington Post, McDonald's stock today climbed 93 cents, or 4.5 percent. Bear Stearns upgraded their rating to "outperform" from "peer perform," pointing to upcoming McDonald's events such as a potential dividend increase and a new national advertising pitch.
The kiosk advantage: Entrepreneur.com discusses franchising in a kiosk environment in "Cart Blanche."
Papa's John's franchisee faces civil liability for delivery murder: Teresa Horan is suing a former Papa John's pizza franchisee in Florida court for sending her husband into a "high-crime area" on a pizza delivery. John Horan was murdered while on a delivery run in December of 2001; the killer has since confessed and is in jail on murder charges. See PizzaMarketplace.com for the report.
Franchising for Veterans: According to Forbes, the International Franchise Association has resurrected a program originally offered after the Gulf War a decade ago. Called VetFran, the program aims to help military retirees become franchisees. One hundred franchisors (the most recent member being Exxon Mobil) participate currently, and VetFran's organizers expect that number to rise to somewhere between 200 and 250 participating franchisors .
AFC misses annual report deadline: The Atlanta Business Chronicle reports that AFC Enterprises, the owner and franchisor of Popeyes Chicken & Biscuits, Church's Chicken, Cinnabon, and the former owner of Seattle's Best Coffee and Torrefazione Italia Coffee, will not meet its filing deadline with the SEC for the submission of its annual report. AFC avoided delisting with Nasdaq in June on the condition that its annual report would be filed by July 16 (see earlier W&D blog entry).
State Dept. issues warning to fast-food franchisees abroad: According to analysts from the U.S. State Department, there have been 139 "security incidents" (threats and/or attacks) against private firms and non-official Americans abroad, and an increase is expected in the number of attacks against fast food franchises for the latter half of the year. The report, available as yet only to constituent members at OSAC, notes that "OSAC also believes that the reason the fast food industry is the focus of so many business threats is due to the fact that [it is] an easily identifiable target and symbolic of American life."
Franchisees at boot camp: Educational workshops and seminars, referred to as "franchise boot camp," are growing in popularity for prospective franchisees.
Banning obesity lawsuits: A Senate bill to be introduced today by Senator Mitch McConnell (R-KY) would protect defendants from obesity lawsuits. Fast food franchises and school districts have recently been targeted by legal action (see earlier W&D blog entry). McConnell explains, "This bill does not outlaw any of the traditional litigation nor does it immunize the food industry. But what it does do is nip in the bud this absurd new predatory practice" of class-action lawsuits against the food industry. Full article at the Washington Times. The text of a similar House bill (H.R. 339) proposed in June may be found here.
Yum! profits drop: Yum! Brands Inc., the parent company of KFC, Pizza Hut and Taco Bell, announced a lower net profit than last year's figures, largely due to costs associated with the lawsuit and judgment in favor of two men who claimed to have created Taco Bell's famous talking Chihuahua (see earlier W&D blog entry). Story at Fox News Business; CBS MarketWatch also reports.
Healthier Happy Meals: Yahoo! News offers details on McDonald's plans to test a version of its Happy Meal involving fruit instead of french fries. A trial run for "Apple Dippers," apple slices that can be dipped in caramel, is planned for this summer.
E.coli lawsuit: Ten adults and four children sued the Excel Corporation, a meat packing company, on Tuesday, alleging that the company's meat caused an E. coli outbreak at two Sizzler restaurants in July of 2000. An appeals court decision in May made the suit possible by overturning the lower court's ruling that Excel was exempt from suit and that its meat was not "adulterated" under the legal definition since any microorganisms could be killed by proper cooking. The restaurants' franchisee and Sizzler previously settled with twenty plaintiffs who sued over E. coli-related illness. Full story available at JS Online. The Seattle law firm of Marler Clark, which represents plaintiffs against Sizzler, has collected a full spectrum of articles on the history and treatment of the E.coli claims.
Illegal Art: Boston.com's business section comments on a touring art exhibition of trademark parody, described as "copyright civil disobedience." While the show, seen in New York, Chicago and Washington, D.C., has generated no legal action itself, some individual artists have been sued by copyright holders.
Starbucks acquires Seattle Coffee Co.: The deal announced in April to sell AFC's Seattle Coffee Company (including the Seattle's Best Coffee and Torrefazione Italia brands) to Starbucks has been completed for $72 million (less than the $75 million that AFC paid for the company in 1998). The accompanying story discusses Seattle's Best Coffee franchisees' concerns over the Starbucks merger.
McTheme Restaurant: Shirley Leung of the Wall Street Journal writes about a trend in European franchising away from visual consistency - instead of the usual furnishings, McDonald's branches in France offer theme decor, hardwood floors, armchairs and even tv's. Though only a few franchises in the United States have put a similar practice into effect - in Chicago, for example, you can find a rock n' roll McDonald's - the company wonders about the possibility of the new theme strategy. McDonald's chief executive Jack Greenberg finds it too early to tell how well the model would work, but says that "everyone [at the company] is paying attention."
Church's CMO resigns: AdAge reports that the chief marketing officer of Church's Chicken has resigned, adding to the current difficulties of parent company AFC Enterprises. Besides running into resistance over Church's ad campaign to change its slogan, AFC is currently selling its Seattle's Best Coffee and Torrefazione chains to Starbucks. The company is also dealing with allegations of securities fraud filed with the U.S. District Court in Atlanta.
The End for Frozen Coke: Via system voicemail, Burger King yesterday told its franchisees that it plans to stop sales of frozen drinks, including Frozen Coke. BK did not address issues surrounding the Coke marketing test or the lawsuit (discussed in previous blog entries) that drew attention to the test and the Frozen Coke product. The Atlanta-Journal Constitution has the text of the voicemail message available.
Private firms join to fund management-led buyout of Meineke: Carousel Capital and The Halifax Group announced their plans to partner with Meineke's management team to purchase Meineke Car Care Centers, Inc. from its parent company, Brambles Parts Industries Corporation.
Federal probe into former employee's allegations against Coca-Cola: A federal investigation has been initiated regarding the allegations raised in an employment lawsuit by former Coke employee, Matthew Whitley. In motions filed yesterday, Coca-Cola sought dismissal of Whitley's suit, calling his claims "frivolous" and "made-for-TV." Whitley filed a wrongful termination suit in May and later amended it to claim that thousands of Coke's frozen-drink machines nationwide are defective and contaminating drinks with metal residue. See the Miami Herald for the full article, and earlier W&D blog entry for a history of the suit. Coca-Cola's federal and state filings for dismissal of Whitley's lawsuit are available for download.
Cash America International acquires Cashland franchise : For a reported $53 million, Cash America is acquiring the Ohio-based franchise company Cashland and increasing the number of its franchise outlets to over 600. The deal is expected to close within 30 to 60 days.
WSJ Franchise Update: Richard Gibson of the Wall Street Journal writes briefly about a number of franchise topics, including the uneasiness of franchise lenders in the face of defaults, updates to the FTC's Franchise Rule, and the fast-growing hamburger franchise ButterBurgers.
New labeling requirements address fat content in groceries: The Food and Drug Administration announced yesterday that effective Jan. 1, 2006, nutrition labels on groceries will be required to list the trans fat content, in addition to total fat and saturated fat content. Trans fat are unhealthy trans fatty acids, which are often found in snacks and fried foods and are associated with a higher risk of heart disease. The new labels must state how many grams of trans fat food products contain, but this Chicago Sun-Times article questions whether this information will be useful if consumers do not understand what levels of trans fat consumption are recommended. The FDA's act regulating trans fat content can be found on www.fda.gov.
In trademark news -- Adidas may lose protection for its stripes: Before the European Court of Justice, the Advocate-General today delivered an advisory opinion recommending dismissal of Adidas' case against a Dutch sportswear manufacturer that uses a two-stripe trim on its clothing similar to Adidas' signature three-stripe insignia. Though European Union law permits trademarks to be safeguarded against dilution and "free-riding," the AG opinion stated that a "simple decorative embellishment" was not a trademark, and that differences between the two product lines should be assessed "solely on the basis of the degree of sensory or conceptual similarity between them." See Guardian Unlimited for the complete story.
IFA to Conduct Comprehensive Study: The International Franchise Association (IFA) recently announced that in the absence of federally-collected data, IFA's Educational Foundation will conduct a research study (with PriceWaterhouse Coopers) to examine the economic impact of thousands of franchised businesses on the US economy.
Investors Turn to Franchising: Entrepreneur.com notes that, while the market continues to struggle, franchise business is growing. More and more investors - "Wall Street refugees" - are looking to franchise opportunities rather than to the stock market. "Based on a survey, Franchise Opportunities.com, an informational site, estimates that between 25% and 30% of new franchise owners are investors coming from Wall Street."
More news on big food and obesity lawsuits: The U.S. Chamber of Commerce released a study last Wednesday arguing that fast food is not to blame for obesity in the United States. This report is available via legalreformnow.com under the heading "On the Stand." In addition, the Washington Times reports on a series of satiric commercials sponsored by the Center for Consumer Freedom to battle the hype of the obesity lawsuits with humor.
Seattle school board's exclusive Coke contract creates controversy: Law professor John Banzhaf has targeted the Seattle public school system, warning school board officials that their exclusive five-year contract with Coca-Cola could lead to an anti-obesity lawsuit for "allowing middle and high schools to peddle soda to students." Banzhaf said that he and other lawyers would support suits filed against school boards that contract with soda providers.
7-Eleven to offer bill payment services: Beginning in the fall, 7-Eleven customers can pay their bills by check, cash, credit or ATM card at 7-Eleven locations through a 7-Eleven partnership with e-Money Systems. The chain hopes to install this summer 1000 units of the Vcom kiosk, a device merging ATM capabilities with other financial services.
Dunkin' Donuts and Krispy Kreme wage the donut wars: The "Dunkinization" of trendy new products goes up against Krispy Kreme's assault on the traditional Dunkin's market; with both chains looking to expand, BusinessWeek comments on Krispy Kreme's recent success and the new offensive Dunkin' Donuts plans in response.
Schlotzsky's adds to its cafe concept: Schlotzsky's has brought in new menu items (including espresso, panini sandwiches and an expanded children's menu) and updated decor to its cafe/bakery unit, where guests also now find wireless internet access and chefs courtesy of the Texas Culinary Academy. Article at Entrepreneur.com.
PETA Sues KFC for Web Site Statements: The Washington Post reports that on Monday, People for the Ethical Treatment of Animals (PETA) filed suit in California Superior court against KFC and its parent company Yum Brands Inc., seeking to enjoin KFC from posting what PETA says are deceptive statements on the KFC Web site about treatment of the chain's chickens.
Fat Suits Affect Marketing Trends: Unhealthy food has become a risk factor for its producers, in light of the elevated concern about obesity and big-food lawsuits. The Salt Lake Tribune reports that restaurant chains and snack manufacturers alike are changing marketing strategies in response to the threat of litigation: McDonald's will test a Happy Meal this summer containing fruit instead of french fries, Kraft has plans to cap the portion size of single-serve snack foods, and Frito-Lay is about to eliminate the trans-fatty acid component of its products.
Former Long John Silver's COO moves to Cosi: Cosi, Inc., a coffee and sandwich chain in eleven states and the District of Columbia, announced today that Kevin Armstrong has been named company President and CEO. Armstrong was formerly the President & Chief Operating Officer for Long John Silver's Restaurants, Chief Marketing Officer for the Subway Franchisee Advertising Trust and President & Chief Operating Officer for Long John Silver's Restaurants. The press release is available on BusinessWire.
Wendy's Sales Down Systemwide. Wendy's, the third-largest burger chain in the U.S., reports same stores sales down 2% for franchisees and 1.9% for company-owned stores throughout the United States. Analysts attribute some of the loss to pressure from McDonalds' launch of salad products which may compete with Wendy's popular salad offerings. See Reuters for the full report.
Quizno's Foots the Bill for Overnight Upgrades on Entire System. Quizno's, the Denver-Colorado sandwich shop franchisor, unveiled the new look of its franchises after a wave of construction paid for by the franchisor itself. Each construction project in the systemwide change took place literally overnight, starting at the close of business one evening and ending before the unit opened for business the following day. "'Our mission is to wow our customers, and the impact of making those changes overnight is pretty powerful,' says Brooksy Smith, executive vice president for Quizno's." This article is reported on Entrepreneur.com.
Julie Bennett of the Wall Street Journal's StartupJournal writes, "Weight-Loss Franchises Pursue Fat Profits."
According to BusinessWire, "Togo's, Inc., which operates Togo's sandwich shops in Michigan, announced Tuesday it has filed a federal lawsuit against Allied Domecq North America Corp., Inc. and others based on their improper use of Togo's Inc.'s trademark TOGO'S. The lawsuit, filed in federal court in Marquette, Michigan, claims that Allied Domecq illegitimately acquired its unrelated Togo's franchise business from a seller in California and thus is improperly using Togo's, Inc.'s TOGO'S trademark. The lawsuit claims that Allied Domecq's current use of the TOGO'S trademark is infringing, especially in the State of Michigan."
According to Law.com, "In the span of 24 hours, a subsidiary of ChevronTexaco went from satisfaction over being found not liable for compensatory damages in a Miami-Dade Circuit Court fraud lawsuit to dismay over being hit with a $33.8 million punitive damages verdict."
"Home Is Where Your Franchise Is," writes Entrepreneur.com
The Puget Sound Business Journal writes, "Seattle's Best Coffee's 27 franchisees are looking forward to July with a mixture of anticipation and anxiety. Sometime midmonth, Starbucks Corp. is set to acquire their franchise contracts from Seattle Coffee Co. as part of its $72 million purchase of the AFC Enterprises Inc. division, first announced in mid-March."
"Under fire, food giants switch to healthier fare," reports USA Today.
"Taco Bell launches 'outside the bun' Caesar Salad," begins this Food Ingredients First article, which continues, "High-quality menu items is a core part of the food chain's ongoing strategy to capture the attention and appetites of consumers."
According to the New York Times, "A New Look and Feel for Church's Chicken."