Are Pick-Up Only Formats the Future of Food?
As digital ordering grows in popularity, food companies are adapting with new formats.
Taco Bell
Yum Brands Inc. plans to launch a Taco Bell mobile restaurant in first quarter 2021 under the Taco Bell Go Mobile banner. Full Story
Taco Bell Go Mobile locations will be around 1,353-sq. ft., compared to the average 2,500-sq. ft. Taco Bell restaurant. The new concepts will also have two drive-thru lanes including a new priority pickup lane with rapid service for customers who order via the app.
Powered by smart kitchen technology that’s integrated with the Taco Bell app, Taco Bell Go Mobile restaurants will detect when guests arrive at the restaurant and suggest the quickest route for a seamless pick-up experience. Customers will also have the option to receive their order via contactless curbside pickup.
To streamline guests’ experiences, Taco Bell Go Mobile will include tablet ordering in drive-thrus and curbside pickup, both of which will be operated by a concierge service of team members, known as “bellhops.”
“With demand for our drive-thru at an all-time high, we know adapting to meet our consumers rapidly changing needs has never been more important,” said Taco Bell president, Global COO, Mike Grams. “The Taco Bell Go Mobile restaurant concept is not only an evolved physical footprint but a completely synchronized digital experience centered around streamlining guest access points.”
Starbucks
Starbucks revealed it is accelerating the rollout of new pick-up stores, reported ABC News (July 30). Full Story
“In urban core markets where drive-thru and curbside aren’t feasible, we will begin to reposition our store formats,” CEO Kevin Johnson said. “These stores are built in a smaller footprint and create a familiar and convenient walk-through experience that is very relevant to customers in urban markets.”
The new store concepts will “ideally be located within a three- to five-minute walk from a traditional Starbucks store” to give customers flexibility to enjoy a beverage in the store or on the go. The company plans to accelerate the development of over 50 of these stores over the next 12 to 18 months with a view to have several hundred in the U.S. over the next three to five years.
Additionally, Starbucks will introduce “a simple handheld device to further increase throughput and improve the customer experience.” A new curbside pickup experience will also be available in 700 to 1,000 locations by the end of this quarter to enable incremental customer visits.
Shake Shack
For the first time, Shake Shack is venturing into the drive-thru concept, reported CNBC (Aug. 5). Full Story
Stores will have lanes for ordering onsite and for digital order pickup. At some restaurants, the company wants to build either a lane only for digital order pickup or a walk-up window, both of which have been dubbed “Shack Tracks.”
“Look, in the moment of safety, people want to stay in their cars,” Shake Shack CEO Randy Garutti told analysts on a conference call. “That’s not going to last forever. But obviously, this country has proven that the drive-thru in its old form works. We want to do in this new form.”
Chipotle
Chipotle Mexican Grill opened its first “Chipotlanes” in 2018 as part of its push into digital ordering.
The drive-thru lanes are only for digital order pickup to cut down on the chain’s indoor lines and speed up service. Chipotle is planning for 60% of new restaurants this year to have a Chipotlane, up from its 50% forecast in February. By 2021, 70% of its new locations will have a drive-thru lane.
The chain’s 13 restaurants with a Chipotlane that have been open for more than a year are experiencing 10% higher same-store sales than the locations without a drive-thru lane, according to CEO Brian Niccol.
Burger King
Burger King unveiled new restaurant designs optimized for COVID-19, which includes offering multiple ordering and delivery modes. The restaurants are 60% smaller with multi-lane drive-thrus, dedicated mobile order and curbside pick-up areas as well as drive-in and walk-up order areas. Other features include pick-up lockers, exterior dining spaces, and suspended kitchens and dining rooms that are ideal for urban driving cities. Full Story
On the Right Track
The focus on these new formats is warranted. Drive-thru restaurant visits increased by 26% in the April, May, and June quarter and represented 42% of all restaurant visits, according to The NPD Group. In July when more restaurants were reopened, drive-thru visits still increased by 13%, the highest visit increase among the service modes of on-premises, carry-out, and delivery. Food Institute Focus
Weekend Takeout Surges as More Indoor Dining Opens
Friday and Saturday night takeout is emerging as a lasting trend during the pandemic, according to Technomic.
Research found that off-premise meals on Friday and Saturday nights accounted for 24% of overall sales in the second quarter—about double the second quarter of last year, reported The Washington Post (Aug. 28). Full Story
Since the pandemic began, the average number of orders was 31% higher on Fridays than on other days of the week, while the average order dollar value was also 34% higher, according to Rewards Network. Uber also reported an increase in orders placed between 2 p.m. and 6 p.m. on Fridays, while Grubhub found that gross food sales grew 59% year-over-year to $2.3 billion up from $1.5 billion in the same period last year.
At Starbird in Sunnyvale, CA, a chicken-centric restaurant with five locations in the San Francisco Bay area, business was up 100% on a Friday night in August. “There has been a demand surge on Friday nights,” said owner Aaron Noveshen.
“Initially during the pandemic, people were cooking a lot, but if there was one day they weren’t cooking, it was Friday. It became this sacred, end-of-week treat. If they couldn’t go out, they could bring food in,” he added.
At Abe’s Place Tap & Grill in Clearwater, FL, owner Abraham Moussa has a bank of people answering phones, two cashiers, two runners, two expediters, and a whole crew on board on Friday nights.
“Between 5 and 9 p.m., we do not stop,” Moussa said, noting curbside Friday and Saturday nights represents the restaurant’s biggest increases. Average tickets during those nights were $75 to $100 pre-pandemic and his average checks now are $150 to $200.
However, more states are allowing indoor dining—which could make for less weekend takeout.
New Jersey bars and restaurants were allowed to reopen their indoor dining sections with restrictions ahead of the Labor Day weekend, reported NJ.com (Aug. 31). Full Story
“NEW: Restaurants statewide will be able to open for indoor dining beginning this FRIDAY at 25% capacity and with social distancing between tables,” Gov. Phil Murphy said in a tweet. “Reopening responsibly will help us restore one of our state’s key industries while continuing to make progress against #COVID19.”
The move comes about two months after Murphy postponed indoor dining he originally announced would be permitted ahead of the July Fourth weekend. Current restrictions mirror the ones detailed in the original plan, some of which consist of patrons wearing masks unless eating, tables spaced at least 6 ft. apart, enhanced sanitation, and limiting seating to a maximum of eight customers per table—unless from an immediate family or same household.
Other restrictions include staff wearing masks, guests placing orders only at a table and staffers bringing food and beverages only to tables, patrons barred from walking around while eating, encouraging reservations, and requiring customers to provide a phone number if making a reservation to facilitate contact tracing.
Additionally, indoor restaurant dining will be allowed in New York City at 25% usual capacity starting Sept. 30, according to New York Gov. Andrew Cuomo. Diners will be required to wear face coverings while not seated; temperature checks will be given at the door; a member of each party must provide information for contact tracing; bar seating will not be permitted; and restaurants will close at midnight, reported MarketWatch (Sept. 9). Full Story
In California, a new color-coded reopening framework has big implications for the state’s restaurant scene, reported Eater (Aug. 31). Full Story
The plan creates a four-tier system that runs county-by-county across the state, allowing for those areas with reduced cases and positivity rates to reopen ahead of more heavily impacted neighboring counties. Meeting the needed criteria at the county level means that restaurants within those certain counties, such as Napa and El Dorado, were able to reopen for limited indoor dining service on Aug. 31.
Some room exists for local variance within the new system. For example, San Francisco is in the red tier, meaning restaurants were able to reopen for indoor dining at 25% capacity (or 100 diners, whichever is fewer) as of Aug. 31.
Plant-Based Continues to Resonate with Consumers
Shoppers are increasingly turning to plant-based products.
The specialty plant-based segment has grown more than 27% since 2017, reaching nearly $5 billion in total brick-and-mortar sales in 2019, according to the recent State of the Specialty Food Industry research from the Specialty Food Association and Mintel. SPINS indicated sales of plant-based products outpaced sales gains during March in the overall food and beverage market, as well as in natural products and organic products, the SFA State of the Industry report found. Full Story
During the pandemic, supply for plant-based alternatives remained strong, while traditional meat and dairy supply struggled to keep up following a surge in demand in March.
“We have not seen any real issues in the food supply,” said Tony Antoci, CEO of Los Angeles-based Erewhon Market. “During the crazy days in March and April the supplies were short but for the most part recovered completely.”
Refrigerated plant-based meat alternatives went up 112% in dollar sales and 70% in unit volume between 2017 and 2019, driven in part by inflation and in part by consumers buying new premium brands such as Beyond Meat—and demand is still growing.
Following Impossible Foods Inc.’s debut of its direct-to-consumer e-commerce site in June, Beyond Meat recently launched its shop.beyondmeat.com site that makes its products directly available to consumers. Meanwhile, Incogmeato by MorningStar Farms is offering the largest new product line in the brand’s 40-year history, reported MarketWatch (Aug. 27). Full Story
Since March, Impossible Foods has increased its presence at grocery outlets 60 times to 9,000 stores, which include Kroger and Walmart. Impossible products are also sold at Starbucks’ 15,000 stores.
In the week beginning Aug. 23, Impossible said its flagship product was now available in packages of two pre-formed, quarter-pound, burger patties at nearly 2,000 grocery stores nationwide owned by Kroger.
Capitalizing on the trend, Hormel is launching a new line of plant-based ingredient solutions available to food manufacturers in the U.S. Full Story
“These new products are designed to help food manufacturers incorporate more plant-based foods into their offerings for the growing number of consumers interested in adding these items to their diets,” said Paul Sheehan, director of sales for Hormel Ingredient Solutions.
The products are powered by pea protein and include fully cooked crumbles and uncooked ground products, with the former available in options ranging from traditional and Italian, to breakfast and Chorizo-style flavors.
“The bottom line is that people want to add more plants to their diet, but they also want them to taste great,” said Sheehan. “These new items allow food manufacturers to explore how easy it is to add the power of plant-based ingredients to a variety of applications.”
Meanwhile, Lightlife Foods unveiled its “Clean Break” campaign to highlight the latest version of its plant-based burger—a vegan patty reformulated with only 11 ingredients. The company also called on Impossible and Beyond to follow in its footsteps and create cleaner plant-based foods, reported Forbes (Aug. 25). Full Story
In an open letter to Beyond Meat and Impossible Foods advertised in newspapers, Lightlife president Dan Curtin writes, “Enough with the hyper-processed ingredients, GMOs, unnecessary additives and fillers, and fake blood.”
He noted that Lightlife is making a “clean break” from “food tech companies” to use simpler ingredients and methods.
However, although Lightlife’s new plant-based burger does have fewer ingredients than its competitors, it clocks in at around the same calorie count and overall fat.
Additionally, it’s not just plant-based meat that consumers are after. Dairy alternatives are also growing in popularity.
Halo Top is introducing an improved dairy-free recipe for the light ice cream maker’s non-dairy flavors. Halo Top’s Dairy-Free series starts with a coconut milk base and now contains fava bean protein. Full Story
“With our Dairy-Free line, we replaced brown rice protein with fava bean protein for a creamier texture that’s packed with flavor,” said Shilpa Gadhok, senior brand manager. “Plant-based demand is higher than ever, and we want to provide our fans with an offering they feel great about eating—so they don’t have to choose between pursuing a plant-based lifestyle and enjoying dessert.” Food Institute Focus
Executives on the Move:
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Fresh Hospitality named Rachel Layton managing partner of the I Love Juice Bar brand. Full Story
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JDE Peet's appointed Fabien Simon as CEO. Full Story
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Bojangles named Monica Sauls chief people officer. Full Story
Store News:
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Silver Diner invested $500,000 to install air filtration, purification, and UV light systems across all 20 locations. The chain is reportedly the first in the U.S. to make the move and its cofounder acknowledges that it was a big investment but said it was necessary and patronage at some locations has risen to around 60%-70% of the 2019 totals since installation, reported Richmond Times-Dispatch. Full Story
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White Castle is offering delivery via Postmates. Full Story
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QDOBA Mexican Eats is testing Mexican cauliflower mash at 23 restaurants in the Indianapolis market. Full Story
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El Pollo Loco launched a loyalty program that offers cash rewards, calling it the most competitive in the industry. The restaurant chain is providing exclusive in-app offers and will add GPS-enabled curbside pickup to the app. Full Story
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Taco Bell will eliminate an additional five items from its menu beginning Nov. 5, following the removal of about a dozen items in August. The company will remove pico de gallo, the Mexican Pizza, and its shredded chicken soft taco, burrito, and quesadilla melt products. New additions include chicken chipotle melt and Dragonfruit Freeze drink. Full Story
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Luby’s will sell Fuddruckers and Luby’s Cafeterias as part of liquidation and dissolution plan that was approved by the company’s board of directors, reported NJ.com (Sept. 9). Full Story
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Daniel Boulud Kitchen will expand its meal kit service nationwide through a partnership with Goldbelly. Full Story
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Chipotle Mexican Grill added a group ordering feature to its app. Full Story
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Chick-fil-A added a chocolate fudge brownie and specialty-grade Thrive Farmers coffee to the menu. Full Story
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Ruby Tuesday introduced Pasta Americana entrees. Full Story
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White Castle launched Craver Nation, a loyalty program based on personal preference instead of points or number of purchases. Users will receive new discounts and offers every month based on their purchase history. Full Story
