Time for ‘good’ ideas in the restaurant industry

Editor's note: This exclusive series to Nation’s Restaurant News provides C-level insights into the sales and traffic data from clients subscribing to Black Box Intelligence, a financial performance benchmarking company. The views expressed here do not necessarily reflect those of Nation’s Restaurant News.

Black Box Intelligence released the most recent Restaurant Industry Snapshot, and for the month of November, same-store sales rose .5 percent — another month in the under-1-percent world that restaurants have been in since the first quarter. In fact, only two of the last nine months of same-store sales were over 1 percent.

We find ourselves hoping for a wonderful December, full of more shopping days than last year to help us move into the new year with some positive momentum. So far for the quarter we are seeing an increase of .3 percent in same-store sales, and we are up against tougher 2011 rollover same-store sales, which increased 1.4 percent in the fourth quarter. 

Quarter-to-date, we are even with the fourth quarter of last year. That quarter was made in December 2011 with a strong same-store sales increase of 2.8 percent. This would lead me to believe we are still going to finish in positive territory, stronger than any quarter since the first quarter of 2012. But with that said, we still need a big month.

Traffic actually improved slightly better than the same-store sales, but remains negative, with a decrease of 1.1 percent, and markets remain pretty equally mixed up and down, as they have been in the past few months. 

Of course, in November the East Coast was hurt in week one by Hurricane Sandy. Interestingly, New York and New Jersey faired better than the Mid Atlantic. This seems to be the pattern after any disaster; revenues rise as help arrives and people have to eat out because of the damage to homes and power outages. Restaurants also experienced a gain during the month in to-go orders and catering, outpacing dine-in sales. 

There is a continuing concern in the restaurant sector from our partner Consumer Edge Research in their Restaurant Willingness to Spend Index, which decreased again this month.  

Creating brand culture

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In this holiday season with the elections behind us and the fiscal cliff still ahead of us, we are operating in this uninspiring 1-percent world with little to tell us that it will get better next year. I want to suggest that the real spirit of the season has some vey good ideas for making a break from the 1-percent world in the future.

If you ask me whether I have any good ideas, ordinarily I would say no. But I have been observing a movement I believe worth considering for our industry and our own individual businesses.

I will start with my trip to Austin a few months ago to attend the Conscious Capitalism Summit. There, I heard the founders of Whole Foods, Container Store, Zappo's and others discuss how they have found the key to breaking the mold for their own commodity industries. In each case they have built their culture about business caring about people, profits and the planet

As Tony Hsieh, CEO of Zappo's, said, “Your brand is your culture.” These great companies are focused on “good” ideas that are truly good — they define purpose in a way that engages employees and encourages customers to buy on more than just price and discount.

I saw an example of that type of “good” idea this morning as I tortured my body on an elliptical. An ad appeared on TV, proclaiming that we are winning the battle against AIDS, and that the advertiser agreed with and supported that battle. Surprisingly, it was an ad for Chevron. Check out their "We Agree" campaign. 

Additionally, in our recent People Report & Black Box Intelligence Best Practices conference, aptly themed People, Profits and Planet, we had numerous presentations by some of the best companies in our industry on how they are re-engaging their workforce around “good” ideas that have a purpose.

We pointed out that the companies in Share Our Strength's “Dine Out for No Kid Hungry," which is built on an idea with good purpose, are outperforming their peers in same-store sales by almost 2 percent year to date. It’s easy to believe that our industry is in a unique position to own the issue of alleviating hunger for children — but that good idea also seems to make a difference in the sales of participating companies. 

Our highest-rated speaker at the conference was an 11-year-old boy named Milo Cress. Milo cares about our industry’s profits and the environment. He has developed a simple idea that has big impact on profits and the planet. This is a "good" idea.  You can learn more about his idea at www.bestrawfree.org.

I wish all of you a very blessed, profitable and peaceful holiday. We’ll be watching for the “good” news for our industry in 2013.

The Restaurant Industry Snapshot is a compilation of real sales and traffic results from 183 DMAs from 110 distinct restaurant brands and approximately 14,705 restaurants that are clients of Black Box Intelligence. Currently, data is reported in four distinct segments: casual dining, upscale/fine-dining, fast casual, and family dining. Black Box Intelligence is a sister company to People Report, which tracks one million restaurant employees on workforce analytics. The Restaurant Industry Snapshot also includes the Restaurant Industry Willingness to Spend Index from Consumer Edge Research, which is a monthly household survey of more than 2,500 consumers. Consumer Edge Insights is a marketing partner with Black Box Intelligence and People Report.

Wallace B. Doolin

Doolin is chairman of Thomas Doolin and Associates LLC, the holding company of People Report, the leader in human capital business intelligence for the restaurant industry and Black Box Intelligence. He is the founder of Black Box Intelligence, a state of the art business intelligence product for the restaurant industry. Additionally, serves as a trustee of the National Restaurant Association and is a past chairman of the National Restaurant Association's Education Foundation. Other current responsibilities include public company board of director service for Caribou Coffee and Famous Dave’s. Previously, Doolin served as CEO of Carlson Restaurants Worldwide and TGI Friday’s, Buca, Inc and La Madeleine.