It’s funny the things that stick with you. I vividly recall from 2004 the frustration in Sam King’s voice as he talked about navigating California’s meal- and rest-break rules while on apanel in Los Angeles that year.
At that time, the company he co-founded and led, Costa Mesa, Calif.-based King’s Seafood Company Inc., was settling a lawsuit seeking damages for alleged nonprovision of rest breaks and meal periods. King said the company was going to be paying out several hundred thousand dollars because of technicalities involving documentation.
King was not alone in his frustration, as several operators in the state have found themselves ensnared in similar lawsuits over the past decade. But eight years later, there’s hope that the groundswell of such suits — as well as the huge dollar figures attached to them — will be minimized. In April California’s Supreme Court ruled that while employers must provide meal and rest breaks, they are not required to police workers to ensure those breaks are taken.
The ruling, which stemmed from a class-action lawsuit involving Brinker International Inc., does not mean the lawsuits will disappear entirely, though. In the Operations section of this issue, we check in with Janet Grumer, a California attorney specializing in hospitality, about the steps operators should take to protect themselves from future litigation following the ruling.
While California is infamous for its tough operating environment, Russia’s may be even more challenging. Still, a growing Russian middle class eager for Western dining experiences has several companies looking to make their mark on the country.
Beginning on page 1 and continuing in the Business Intel section, we look at the lure of Russia and the challenges awaiting the growing number of operators setting up shop there. As Richard Snead, who as chief executive of T.G.I. Friday’s took that brand to Russia years ago, noted, it’s “not for the faint of heart.”
Going public also takes courage, but several companies are poised to take the plunge in 2012. In the Finance section we explore the factors driving the industry’s growing IPO activity, as the parent companies of Outback Steakhouse, Joe’s Crab Shack and Del Frisco’s Double Eagle Steak House, among others, prepare to enter, or re-enter, the public market.
Chris Sciortino, managing director of Robert W. Baird & Co.’s consumer investment banking team, said he expects the spring surge could be “the first inning of a restaurant IPO burst.”
Unusual desserts take center stage in the Food & Beverage section, as operators find they can sweeten sales with the likes of roasted-beet and chocolate cake, and corn crémeux with huckleberry compote, kataifi, cilantro and Parmesan ice cream.
And in other matters of the palate, in this issue’s Special Report we look at why premium keg wines and batch cocktails are increasingly taking up residence alongside kegs of beer and soft drinks on bar menus nationwide. For those of us non-beer drinkers who rarely get to ask what’s on tap, the times are a-changing. Last night I tried a kegged Pinot Noir, and it did not disappoint.
Finally, in Marketing we examine the shift away from using brand characters as “spokesthings” and toward using real people in advertisements, including executives, athletes and supermodels, as companies push today’s all-important message of authenticity.
But while Domino’s Patrick Doyle and Papa John’s John Schnatter clearly lend credibility to their marketing campaigns, I’m not sure such ads will be recalled as fondly as those featuring the Taco Bell Chihuahua or the Hamburglar.
Then again, it’s funny the things that stick with you.
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