Week of May 10, 2010


U.S. Restaurant Performance Index at Highest Level Since Sept. 2007 — NRA
The U.S. Restaurant Performance Index (RPI) of the National Restaurant Association (NRA), reported for the month of March, climbed from 98.3 to 100.5, its highest level since September 2007. For the first time since November 2007, it also surpassed the 100 mark. The RPI is based on responses to the NRA’s national monthly Restaurant Industry Tracking Survey, which tracks a variety of indicators, including sales, traffic, labour and capital expenditures. The RPI consists of two components — the Current Situation Index and the Expectations Index.

The Current Situation Index found that, for the first time in 22 months, U.S. restaurant operators reported positive same-store sales growth. Some 43 per cent of restaurant operators are reporting a gain between March 2009 and March 2010, which is up from 28 per cent of operators who reported higher sales in February. Only 36 per cent of operators noted a same-store sales decline in March 2010, well below the 57 per cent who reported negative sales the previous month. Restaurant operators also saw a net increase in customer traffic in March, the first positive reading in 31 months.

The Expectations Index, which measures restaurant operators’ six-month outlook, shows positive growth expectations, rising to 101.9 in March, up 0.5 per cent from 101.4 in February. That is its strongest level in nearly three years. U.S. Restaurant operators are also more optimistic about their sales prospects, with 50 per cent expecting to have higher sales in six months (compared against the same period last year). That is up from 44 per cent who reported similar expectations last month, and it is the strongest level in 33 months.

Canadian Jobs Increased by 109,000 in April — StatsCan
According to new data from StatsCan, employment in Canada increased by 109,000 this past April, the largest monthly gain in percentage terms in almost eight years (August 2002). The April gain brings total jobs added since the start of the upward trend in July 2009 to 285,000. The most recent employment downturn began in the fall of 2008. In April, two-thirds of the employment growth was among men aged 25 and over (72,000), the strongest monthly increase for this group since comparable data became available in 1976. Employment growth in April was in both part-time (65,000) and full-time (44,000) work. Since July 2009, growth has been concentrated in full-time work.

Hotel Investment Crashed in 2009, Down 61 per cent — Colliers
In 2009, the hotel investment sector suffered one of its worst years in history, as transaction volume plummeted 61 per cent and national price-per-room declined 12 per cent, according to the 2010 Canadian Hotel Investment Report prepared by Colliers International Hotels. The report states it is the sharpest decline in activity on record, down 91 per cent from the peak reached in 2007. In a story on CTV.ca, Colliers’ executive managing director Alam Pirani commented, “The good news would be that many owners are hanging in there because of conservative capital structures — not a lot of them were over-levered. You can count the number of distressed sales on one hand.” He added that there are buyers interested in acquiring properties, but accessing financing is difficult and agreeing on the market value of hotel assets is difficult. For more information, click here.

F&H, Hotelier Magazines Earn Nine KRW Nominations
Kostuch Publications Ltd. is pleased to announce its two hospitality industry-leading magazines, Foodservice and Hospitality (F&H) and Hotelier, have been nominated for nine Kenneth R. Wilson (KRW) Awards. F&H garnered seven nominations and Hotelier earned two. The KRW Awards, the Oscar’s of Canadian B2B magazine publishing, are given out each year to the best of the best in Canada’s business-to-business magazine industry. The nominees are:

•  Best Issue: “Arch Rival” — Rosanna Caira/Alistair Kyte/David Heath (F&H)
•  Best Editorial: “Whose Meal is it Anyways?” — Rosanna Caira (F&H)
•  Best Profile of a Company: “Return of the Mac” — Alistair Kyte (F&H)
•  Best Profile of a Company: “Three’s Company” — Rosanna Caira (F&H)
•  Best Regularly featured Department or Column: “Food File” — Alistair Kyte, Lisa Paul, Signe Langford (F&H)
•  Best Art Direction of an Opening Spread or Complete Feature: “Is Your Business Shrinking?” — David Heath (F&H)
•  Best Photograph: “The Innovators” — Will Lew (Hotelier)
•  Best Photograph: “Drawing Attention” — John Hryniuk (Hotelier)
•  Website of the Year: foodserviceandhospitality.com (F&H)

Now in its 56th year, the KRW Awards are organized by the Canadian Business Press and Magazines Canada. From more than 600 individual entries nationwide, the KRW Awards’ 77 volunteer judges nominated 180 submissions from 68 different Canadian business-to-business magazines for awards in 21 written, visual, special and online categories. Gold, Silver and Honourable Mention awards will be announced at The Carlu in Toronto on June 1 at the 56th Annual Kenneth R. Wilson Awards gala. For tickets and other information, click here.

U.S.-Based QSR Operators Increased Advertising in 2009 — Nielson
While U.S. advertising as a whole declined in 2009, quick-service restaurant (QSR) operators increased their advertising in 2009 by two per cent compared to 2008, according to the New York-based Nielsen Company. QSR operators spent almost US$4.1 billion on advertising in 2009, with 36 per cent of that figure, or about US$1.47 billion, going to spot TV advertising. Network TV advertising followed with $934.8 million in advertising spending, or 23 per cent of the total. Cable TV was the third most popular advertising outlet, with $868.3 million in spending or 21 per cent of the total. For more information, click here.

Expedia Insiders’ Select Lists Vancouver’s Sutton Place, Toronto’s Hôtel Le Germain
Vancouver’s Sutton Place Hotel and Toronto’s Hôtel Le Germain have been recognized as two of the world’s best hotels by the 2010 Expedia Insiders’ Select list. With more than 110,000 hotel properties offered on Expedia.com, the Insiders’ Select list is compiled from more than 1 million hotel reviews by travellers, combined with an overall value rating as well as the local market expertise of more than 400 Expedia employees around the world.

Quebec City Diners Enjoy Wine By Glass, By “Evaporation” or By the Bottle
Will that be wine by the glass, by “evaporation” or by the bottle? That is the question for diners at several Grande-Allée Est restaurants in the heart of Quebec City’s entertainment and restaurant district. If you select “by evaporation,” just choose a bottle of your favourite wine, enjoy as much of it as you are comfortable with and only pay for what you consumed — bottles are usually divided by sixths. The remaining wine is then sold to other customers by the glass. Several other restaurants in the city are promoting the same wine program, which, allegedly, is onside with SAQ (Société des alcools du Québec) regulations.

Choice Hotels International Hosts Annual Conference in Las Vegas
After three days of intense meetings, workshops and a little Las Vegas flair, Choice Hotels International wrapped up its 56th annual convention at the Mandalay Bay Resort last week.

With more than 4,000 delegates in attendance, including 300 hotel owners and developers from around the world, Steve Joyce, president, Choice Hotels, welcomed the crowd by recapping a year that, despite challenging economic conditions, turned out to be solid for the hotel company. “Last year tested all our resilience and our strength,” said Joyce. “We could have easily followed our competitors and cut training and education, service and amenities. We could have looked the other way on our property and room conditions. But that’s not what we chose to do because we are leaders not followers,” Joyce said to a captive audience.

Themed “Right Here, Right Now,” the three-day conference was a study in optimism, focusing on the various initiatives introduced by Choice over the past year, as well as looking forward to the future now that the economy has rebounded. “Through our joint efforts, we increased RevPAR index by 20 basis points in 2009 — our highest RevPAR index since 2006 when times were booming,” Joyce said to the audience, which burst into applause. The company’s biggest brand, Comfort Inns, experienced one of the largest RevPAR index gains of 180 points. Here are some more highlights from the conference:

The company’s two new brands — the Ascend Collection (upscale properties in urban destinations) and Cambria Suites (an extended-stay upscale brand), are doing well. “We have 21 hotels open, seven of which came online in the past year, and consumers love the brand,” said David Pepper, senior vice-president, Global Development, referring to Cambria Suites. It is set to open three more units in 2010. Pepper also told the crowd that Mainstay Suites and Suburban are opening two hotels in Canada this coming year in Winnipeg and Edmonton respectively.

Choice Hotels has also redesigned its Sleep Inns brand to provide a simply stylish and reliable stay experience that leaves guests well rested. “We’re looking for a new direction for Sleep,” said Mike Varner, director, Brand Planning. “It’s a new prototype. Our franchisees were asking us for years to do something.” The company responded by introducing new lobby designs with warm, natural finishes. Guest rooms are redesigned with accented walls, new media boards and sleek furniture lines. Properties will also feature spa-like baths and a redesigned exterior with natural stone finishes, low-roof profile and broad overhangs. “Simply stylish was a brand promise to customers to provide a highly consistent reliable product and to ensure they were well rested,” said Varner. Renovations are currently underway across the system with a targeted 80 per cent of properties to be renovated in the first three years of the program, with the remainder following two years after that. The new rooms will cost owners $5,500 per key.      

Recognizing the importance of room cleanliness, the company also launched a new integrated compliance program, which will roll out in 2011, blending early-warning performance notifications with support and resources to help hotels improve on their own. “Along with great staff service, this will help us maintain and strengthen the loyalty we’ve earned from customers this past year,” said Joyce, who pointed out that 300 hotels have exited the hotel company because they didn’t honour its standards levels.  

From a Canadian perspective, Choice Hotels has always had a deep affinity for the Great White North, choosing to open its first international unit here in the 1970s. Today, the company boasts 280 units. “We had 19 new deals in 2009, which makes us the second largest pipeline in Canada,” said Brian Leon, managing director, Franchise Growth and Administration, Canada, at the Canadian reception held during the convention. There are currently 22 new hotels under development in Canada, 15 of which are conversions and seven that are new builds.      

With a global portfolio of 1,100 hotels in more than 35 countries, Choice is targeting continued international expansion over the next few years with particular focus on India, where the company now boasts 28 hotels. “We’re excited about India,” said Pepper during a media roundtable. “With one billion people, there’s a huge opportunity to grow in there.”     

Like many other hotel companies, Choice has invested a great deal of time and resources on its website. “Visits to the site are up by 11 per cent through the first quarter of the year, and the site has already experienced more than 20-million visitors since its redesign. “The site now contains many new features, including prepaid advance purchase rates, searchable hotel deals and expanded content to differentiate each brand,” said Mary Beth Knight, senior vice-president, e-Commerce and Global Distribution. The company has also built a new smartphone app designed to drive business to hotels. “It will allow visitors to take a tour of the hotel, email and find out what’s located around your hotel,” said Chris Kornmayer, senior director of Brand Strategy. And while many hotels companies have struggled with rate discounting, Choice has been diligent in working to keep rate integrity, choosing to focus on value promotions such as the Amex cardholders’ ‘Stay a Night, Get a Free Night’ promo. “We’re about building loyalty to our brands, staying in control of how we sell — and most important, safeguarding profits,” said Knight.

Finally, in an age where customer loyalty comes with a cost, Choice Privileges continues to grow in popularity, ranking fourth on the list of most popular loyalty programs, with 2.5-million members. The company’s spring promo, ‘Stay a Night, Get a Free Night,’ generated $109 million in Choice Privileges revenue in March. Choice Privileges accounted for nearly 26 per cent of gross room revenues in 2009, compared to 22 per cent in 2008.   

OHSA Workplace Harassment Law Comes into Effect June 15
Ontario’s amended Occupational Health and Safety Act (OHSA), Bill 168, comes into effect on June 15 with new policies related to workplace violence, harassment and the requirement for companies to develop and maintain programs to implement these policies. Workplace violence and harassment programs must include measures and procedures for workers to report incidents of workplace violence and/or harassment and set out how the employer will investigate and deal with the incidents or complaints. To meet these obligations, Toronto-based TrainCan Inc. has introduced an online WHST – Workplace Harassment Sensitivity Training program. The three-unit course is designed for both management and non-management workers. Upon completion, individuals should be equipped to recognize and properly address workplace harassment to prevent such situations when possible. For information, visit traincan.com or labour.gov.on.ca.

Nutrition Info On Restaurant Menus Tested at U. of Waterloo
A new two-year study to determine whether or not posting nutritional information on restaurant menus helps people make healthier food choices has been launched at the University of Waterloo. The study, which is the first of its kind, is funded with $276,000 by the Canadian Cancer Society. The study will also measure what kind of menu labelling is the most effective, by using a Tim Hortons’ menu in four different formats with a test sample of 600 adults. “This is potentially a high-profile policy issue. It’s surprising that more hasn’t been done,” said lead researcher David Hammond, an assistant professor at the University of Waterloo, in a Toronto Star story. “The reality is Canadians are eating more and more outside the home, and they really don’t know anything about what they’re eating…It’s difficult when you can have coffee products that either have 20 calories or up to 800 calories.”

As reported previously in TheWhat’sOnReport, several U.S. states and cities, including California and New York City, have passed legislation requiring restaurant chains post calorie information on their menus. President Obama’s U.S. health-care bill also includes national regulations that will require any restaurant with five or more locations to put the calorie content of their meals on menus. Many QSR chains and some independent restaurants in Canada currently provide nutrition information on their websites or in a brochure or wall posting at the restaurant.

East Side Mario’s Teams with Breast Cancer Foundation
Restaurant companies giving back to the communities that keep them in business is just one of the many things that makes the Canadian foodservice industry so great. East Side Mario’s, based in Mississauga, Ont., has long been a part of that group, and last week it announced that it’s the exclusive casual-dining national sponsor of the 2010 Canadian Breast Cancer Foundation CIBC Run for the Cure (Oct. 3), and a supporter of the Canadian Breast Cancer Foundation. “East Side Mario’s commitment to the neighbourhoods and families we serve extends well beyond providing a great dining experience full of value, variety and fun,” said John Verdon, vice-president, Marketing, East Side Mario’s. “Most of our restaurants are family owned and our focus is on moms and family, so partnering with a leading charity like the Canadian Breast Cancer Foundation that’s making a significant difference in the lives of many Canadian families, was an easy choice.” The partnership with the Foundation kicked off on Mother’s Day, with an in-store promotion to raise awareness about breast cancer. Every table that was served at East Side Mario’s from May 7 through May 9 (Mother’s Day) received a breast health bookmark and more information about the partnership.  

Edmonton-Based Organic Supermarket Chain Now Under CCAA
Edmonton-based Planet Organic Health Corp., which continues to operate nine natural food supermarkets in Canada and 11 in the U.S., is now operating under the Companies’ Creditors Arrangement Act (CCAA) with Deloitte & Touche Inc. as the court-appointed monitor. The CCAA filing also includes its wholly owned subsidiary in Canada, Darwen Holdings Ltd., but does affect the company’s U.S. assets, where it operates under the Mrs. Green’s Natural Markets banner. The publicly traded company, established in 1993 by founders Mark Craft and Diane Shaskin, had its debt of US$31.1 million called in by the company’s principal lender, Catalyst Capital Group Inc. A shareholders’ meeting is scheduled for May 14 in Calgary.

We Care Celebrates 27 Years, Sending 30,000 Kids to Summer Camps
A cheque for $1,004,450 was recently presented to The Easter Seal Society of Canada by the Friends of We Care Foundation Inc. at We Care’s Annual Gala held at the International Centre in Toronto on May 1. This contribution, through the support of the foodservice and hospitality industry, will assist in sending close to 5,000 Canadian children with physical disabilities from across the country to special camps this summer. Since its inception, Friends of We Care have generated more than $14 million, sending more than 30,000 children to summer camps across Canada.

The Corporate Friend of We Care Award was presented to Sysco Canada for its ongoing corporate commitment to Easter Seal children. It was presented to Joel Grade, CFO Sysco Canada by 2009’s award recipient, Brent Cator of Cardinal Meats Specialist Ltd. The We Care Hall of Fame award was presented to Jack C. MacDonald of Compass Group Canada, presented by We Care Chair Jim Grieb of Flanagan Foodservice. The Gary Wright Humanitarian Award, which honours one of the founders of Friends of We Care Inc., was presented to Carol Moffatt Bailes, who has been involved with Friends of We Care for nearly 20 years and has dedicated a big part of her humanitarian efforts towards the success of disabled children. The award was presented by the 2009 award recipient, Brian Orr.

New Vending Machines with iPhone-Style Interfaces Introduced at NAMA OneShow
The NAMA OneShow of the National Automatic Merchandising Association, which supports the vending, coffee service and automatic foodservice industry, saw two new next-generation machines unveiled by Kraft Foods and Coca-Cola, expected to be available on the market by fall 2010. The three-day event at Chicago’s McCormick Place combined NAMA’s Spring Expo and its National Expo into one annual event for the first time. Instead of a traditional array of plastic-wrapped food behind a window, Kraft’s Diji-Touch features a menu with an iPhone-style interface, offering images of available chips or candy bars. But, with a simple tap, the image enlarges and the item swivels, revealing ingredients or nutritional information. “For 20 or 30 years, nothing much new has happened with vending machines,” Kelly Brennan, Kraft marketing manager, was quoted as saying in a Chicago Tribune story. “This is the next step,” he added. Coca-Cola also demonstrated its Interactive Vender, which has a 46-inch LCD-screen with product images. “We have kids walk up to it (a handful of the machines are being tested in shopping malls) and they try to enlarge the images with their fingers,” said Coke’s John Turner, who is responsible for vending innovation, in the Tribune story. “It’s incredible how much Apple has influenced our basic actions.”

Vancouver Restaurants Celebrate Beer
In support of Vancouver’s inaugural Craft Beer Week, which kicks off today through May 16, at least two local hotspots will be offering guests a unique beer-inspired experience. On Sunday, May 16, Vancouver’s CRU Restaurant will host a dinner celebrating the beers made by the Whistler Brewing Company. Guests will enjoy a five-course dinner menu paired with craft beers for $70. The dinner will be hosted by Whistler Brewing Company’s president, Bruce Dean, who will introduce guests to the brewery’s full range of all-natural beers — from the light citrus flavours of summer Weissbier to the rich and velvety Black Tusk Ale. Executive chef Alana Peckham has designed a special menu for the evening that will show the beers to their best advantage. Chambar Restaurant will also be putting on a five-course meal steeped in beer and paired with authentic Belgian brews, including the restaurant’s own Chambar Ale. The dinner, to be held on May 11 at 7:30 p.m., will be led by Chambar bar manager Wendy McGuinness and Chef Nico Schuermans. Tickets are $100 (excluding tax and gratuity) per person.

Groupe Restos Plaisirs Relocates Paris Grill
The eight-location La Groupe Restos Plaisirs, based in Quebec City, has moved its Paris Grill brasserie (opened in October 2004) to a new-build, expanded location in the Complexe Jules-Dallaire on Laurier Boulevard. Proudly designated as “La Brasserie du 3 Arrondissement” after the famed café district in Paris, the location features breakfast seven days a week, from 7 a.m. Monday to Friday and 9 a.m. on weekends. Francois Drouin is executive chef, with his team working in an open kitchen, featuring French specialties and local foods, including Alsatian Pie.


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