A Deeper Dive

How does a pot-themed brand become one of the industry’s fastest-growing restaurant chains? This week’s episode of the Restaurant Business podcast A Deeper Dive features Marc Torres, the CEO of the fast-growing sandwich chain Cheba Hut. The Fort Collins, Colorado-based chain has picked up its growth in recent years behind franchising and strong average unit volumes. System sales grew 29% last year, according to Restaurant Business sister company Technomic. Average unit volumes are well over $2 million, far higher than traditional sandwich concepts. Marc discusses Cheba Hut, its history and performance, including why it generates those volumes. We also talk about franchising. He also talks about the company’s pot theme, and how it convinces customers and landlords that it is more than that. Cheba Hut does not sell any THC, and Torres notes that its marijuana theme can only get the company so far. Ultimately its food does the talking. We’re talking Cheba Hut on A Deeper Dive, so please check it out.

What do all these bankruptcies mean for the future of the restaurant industry? In this week’s episode of the Restaurant Business podcast A Deeper Dive, RB editors Joe Guszkowski and Lisa Jennings join me to discuss the spate of bankruptcy filings this year and what they mean for the business. Seventeen restaurant chains have filed for Chapter 11 debt protection this year, most of them since June. That probably undercounts the true industry challenge as several companies are either close to filing or are doing an out-of-court restructuring. The filings include one of the industry’s biggest ever in Red Lobster. We discuss these bankruptcies and get an update on where the businesses stand. We also talk about why these bankruptcies are happening now, four years after the pandemic. We also get into a discussion on what works and how businesses can generate sales in a difficult environment. Amid all the bankruptcy filings are companies like Chili’s and Wingstop that have reported ultra-strong sales. Why are they able to do that while others struggle? We’re talking bankruptcies on A Deeper Dive so please check it out.

What does the potential Circle K-7-Eleven deal mean for restaurants? This week's episode of the Restaurant Business podcast A Deeper Dive features Hannah Hammond, a senior editor with RB sister publication CSP Daily News. CSP covers convenience stores, and I wanted to talk with Hammond about the big news of the week—maybe the year—in the convenience-store industry: The proposed acquisition of Seven & i holdings by Alimentation Couche-Tard. Seven & i is the Japanese owner of 7-Eleven and Alimentation Coche-Tard, or ACT, is the owner of Circle K. 7-Eleven is the country and world’s biggest convenience store chain. Circle K is No. 2 in the U.S. This was the equivalent of Starbucks proposing to buy McDonald’s. Hammond talks about the deal and what it means for the companies themselves and the c-store business and whether it could get through the FTC. We also talk about what this means for the respective chains’ growing competition with quick-service restaurants. And we talk about all kinds of other c-store stuff, including Wawa and Buccee’s and why convenience stores can’t spell the word Quick. We’re talking c-stores on A Deeper Dive, so please check it out.

Kerri Harper-Howie, a second-generation McDonald's franchisee and author of 'The Family Secret,' shares her journey of building generational wealth through franchising. She discusses the profound influence of her mother on their family's success and the lessons learned in the fast-food industry. Kerri highlights the benefits and challenges of operating a franchise in California, including the economic pressures and the importance of succession planning. This insightful conversation offers valuable perspectives on creating a lasting family legacy through business.

Why are some restaurant chains suddenly struggling in international markets? This week’s episode of the Restaurant Business podcast A Deeper Dive features Joel Silverstein. Silverstein is a periodic guest on the podcast. He is the founder and CEO of the hospitality consulting firm Canyon Springs Advisors. He has helped a lot of companies grow in overseas markets. I wanted to talk with him about the state of international development. We talk quite a bit about the state of the industry in China, where a number of U.S. chains have suddenly struggled but which are still intent on growing there. We focus particularly on the coffee market, where Starbucks is struggling as is Tim Hortons. Both are watching as several aggressive upstarts, notably Luckin Coffee, have grown rapidly with low-priced coffee. We talk about that competition and what it means for the market there. We also talk about the global economy and its impact on restaurant brands, as well as overall conditions in the U.S. It’s a great conversation about international development on A Deeper Dive, so please check it out.

Why should franchisees take private-equity investments? This week’s episode of the Restaurant Business podcast A Deeper Dive features Mike Esposito, the cofounder of Franchise Equity Partners. Franchise Equity Partners is a private-equity firm specializing in the franchise business. Mike helped found the firm in 2021 to invest in all kinds of franchisees. Before that he had an extensive career in investment banking, working 20 years with Goldman Sachs. He is also a Jersey Mike’s franchisee. We talked with Mike about the state of the restaurant business, mergers and acquisitions and other issues, and the result was an extensive, interesting conversation about what kinds of investments work these days and what do not. We talk about the necessity of restaurants’ value push and the impact it could have on margins. We talk about the kinds of concepts that have distanced themselves in today’s markets and how you can know whether an emerging chain has legs or not. And we also ask why a private-equity investment is a good idea for certain franchisees. But the biggest question we ask him is whether he is buying or not. His answer to that question is instructive. It’s a wide-ranging discussion on A Deeper Dive, so please check it out.

Troy Hooper, CEO of Pepper Lunch, discusses how the Japanese fast-casual chain is breaking into the U.S. market with its unique interactive dining experience. Topics include menu overhaul, Asian chains' popularity, customizable dining, supply chain challenges, and navigating the tough American market.

Why are restaurants losing customers right now? This week’s episode of the Restaurant Business podcast A Deeper Dive features R.J. Hottovy, head of analytical research with Placer.ai. Hottovy has followed the restaurant industry for years, and the foot traffic data firm has been tracking customer counts to restaurants and retailers. In November, Placer.ai noted traffic suddenly falling to Starbucks shops, foretelling a sales challenge the coffee giant has dealt with all year. We wanted Hottovy on the podcast to talk about these issues and about why restaurants are losing traffic. We also talked about the specific challenges facing Starbucks. We also get into plenty of other topics. Please check it out.

Why is it better for small restaurant chains to band together? This week’s episode of the Restaurant Business podcast A Deeper Dive features Kelly Roddy, CEO of the brand platform company Woworks. Woworks operates several restaurant concepts, including Saladworks, Garbanzo Mediterranean, Frutta Bowls, Simple Greek, Barberitos and ZEats. It is one of a growing number of platform companies that collect small concepts, and these companies have been gobbling up a lot of brands lately. The idea is that they can get stronger buying power and therefore cheaper prices for franchisees, at least in theory. They can also invest in technology. We asked Kelly about that and how it works. We also ask about the market for mergers and acquisitions. Woworks is apparently in the market for a new chain and we talk about that, what the market is like, what kinds of companies they’re looking for and how they could fit in. We’re talking brand collecting on A Deeper Dive, so please check it out.

Can technology fix restaurants’ workforce issues? This week’s episode of the Restaurant Business podcast features two different discussions. First, we chat with Michelle Korsmo, the president and CEO of the National Restaurant Association. We chatted with Michelle at the National Restaurant Show in May and discussed a variety of issues, including the regulatory environment, how companies are dealing with soaring costs and the importance of restaurant technology. And speaking of restaurant technology, we also have RB Senior Technology Editor Joe Guszkowski on to talk about drive-thru AI, an increasingly popular piece of technology. McDonald’s just ended its test of that technology and I wanted Joe to talk about what that means for the future of the innovation. We also chat about Red Lobster. It’s a two-for-one interview day on A Deeper Dive so please check it out.