Fast Casual Executive Summit

B.Good, Wahlburgers, Salata, Gloria Jean's leaders on the state of fast casual 'front'

The fast casual restaurant "front" is inncreasingly a rough-and-tumble one on the restaurant industry field of play. But the four brand leaders on the Fast Casual Executive Summit CEO Roundtable proved they're up to the fight and shared their thoughts with how they hope to win the battle going forward.

October 16, 2019 by S.A. Whitehead — Food Editor, Net World Media Group

The four fast casual leaders participating in this year's Fast Casual Executive Summit CEO Roundtable might well have taken the stage fully covered in body armor and armed to the teeth. No, it wasn't a hostile audience, but the discourse of the next hour made it plain these brand leaders were in engaged in daily battle of sorts to meet the demands of increasingly antsy, convenience- and speed-seeking customers who insist the brands that get their business invest in rapidly evolving, ever-more-costly restaurant tech even as the need for that elusive restaurant frontline employee grows. 

Yes, it's rough out there. On that they all seemed to agree. But in the final analysis, they all also concurred that it's still a great business and — at its core — will always be about connecting to customers with killer food, a crazy-good customer experience through a great brand persona.
In the hour-long capstone session of the summit at the Austin, Texas J.W. Marriott, the four leaders addressed a packed house of audience members paying close attention to the collective restaurant wisdom coming from the stage. The names behind that wisdom, included: 

• B. Good CEO Chris Fuqua.
• Gloria Jean's Gourmet Coffee and It's a Grind Coffee President Sam Ferreia.
• Salata President Michelle Bythewood.
• Wahlburgers President Patrick Renna. 

The four dug deep to give their impressions of the state of the industry as it is and what their best guesses are about things to come. These thoughts were spurred on by insightful questions from moderator and Mobivity founder ad CEO Dennis Becker, whose company also sponsored the session, that started right in the proverbial deep end, with a all-too-fitting question for the four restaurant warriors about the so-called "tech arms race." Becker wanted to know where it really actually existed or not in the view of these leaders.  

To that, all answered a pretty resounding, "Yes!" The group said that such a race does exist in the fast casual sector because the younger generations of customers absolutely demanded it from the brands they patronize. That obvious demand, however, does not make meeting those demands easier, according to this panel, who said smaller brands are especially challenged.  

"Younger generations just expect to use technology and they expect to use technology to engage with us," said B.Good's Fuqua. 

But the panelists also agreed that for most fast casual brands, it's not feasible to try to fully own and operate these services and the needed hard- and software in-house. Instead, most found a combination of outsourced tech-related services and owned and operated technology functions worked best, particularly due to the increasing speed with which most restaurant technology is evolving. 

Whether outsourced or in-house, all found the task of fairly and profitably sharing those costs with franchisees an increasing concern. 

"The biggest challenge in the franchise model is to how make things cost-effective for smaller companies ... So when we push tech forward, we have to ask, 'Are we "nickel and diming" the people who really believe in us?'" Ferreia said. 

To that Wahlburgers Renna said as a smaller brand, Wahlburgers is just now getting into tech in earnest, with great expectations, particularly given its famous family of owners. 

"We're smaller and just getting into tech, so we just launched our app and loyalty program. Hopefully the 13 million followers that Mark Wahlburger has will sign up for that," he said to a wave of audience and panelist laughter.

"But we're mostly franchised and we test it first and then we push it out. We don't want to push it out and have it not work, so we test it in our home stores first."

But on the "wins" side for technology, the four leaders all seemed to agree that when it comes to technology the best return on investment they've seen at their restaurants has come from back-of-house tools to manage everything from food costs to labor. 

And on that topic of labor, the panelists were unequivocal: All brands are hurting like never before. 

"I think this is the hardest labor environment that's ever existed in the history of the restaurant industry. The forces playing in on the labor side right now are pretty drastic and I don't think it's going to get better," Fuqua said. 

The leaders concurred that the sheer dearth of available manpower was in itself making it a challenge to grow their chains at the rate they might most prefer. This did not stop any from keeping up the fight by seeking new and better way to make their brands great places to work. 

"Having a place where people feel welcomed and rewarded helps, and as word of mouth gets out, it gets easier to find our own employees," Renna said. "But I also agree that it's the toughest labor market ever out there. Like we're opening in Texas right now and we're at 65% of what we need to be (to adequately staff the location) and we've got just two weeks left."

It was the type of response that almost begged Becker to ask, as his did, about whether labor difficulties might also be driving accelerated interest by restaurateurs in the increasing use of automation in restaurant. But perhaps surprisingly, most of these leaders said they weren't there yet. 

"I think there's a flashy story about robots flipping burgers out there, but that's probably not what anyone in this audience is thinking of when it comes to automation," Fuqua said. "But then, we also already have robots in the form of smart equipment now."

To that, Bythewood said at Salata they're less about automation in the restaurant than optimizing the use of the way they do things now, whether that means automation or just using better processes and equipment to accomplish goals. 

"We're just looking for smarter ways to do things in the back of the house," she said, using as an example a new piece of food slicing equipment that will speed up food prep and ease the task for staff.

One of the last topics the panel tossed around involved what most perceived as an increasing pace of menu innovation in the fast casual space as opposed to the other trend in some brands to strip the menu down to a a very few core products. 

Most of this panel thought customers today crave constant innovation from their preferred brands, whether that be through a continually changing parade of LTOs, or line extensions that simply augment current offerings, as was one of the primary approaches cited by Ferreia at It's a Grind and Gloria Jean's. 

That contrasted with the approach that Bythewood said Salata has taken working off an 18-month calendar of menu innovations, much like Wahlburgers which Renna said works about a year in advance on such plans. In fact, it was Renna's summation on this topic that might also apply well to what these fast casual leaders conveyed they most try to do in their daily fast casual "battle."

As he put it, "You have to get out ahead of it." 

About S.A. Whitehead

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Pizza Marketplace and QSRweb editor Shelly Whitehead is a former newspaper and TV reporter with an affinity for telling stories about the people and innovative thinking behind great brands.