July 2004

Cover Story: Breaking Out of a Slump
Denny’s is in the midst of a turnaround. Although the 1,621-unit chain is still mired in debt and remains cash-flow negative, it has reported increased sales, revenue and guest counts for the last several months, the longest run in recent memory. CEO Nelson Marchioli credits the surge to the company’s hospitality initiatives and focus on breakfast. With an appreciating stock price and improved fundamentals, Denny’s is now depending on franchising for survival as it opens restaurants in Las Vegas; Orlando, Fla.; and McAllen, Texas.
By David Farkas

Storyboard: Double Exposure
El Pollo Loco’s new “Taste the Fire” campaign consists of completely separate ads for its American and Hispanic customers. The mainstream American spot features El Caliente, the chain’s new Hispanic spokescharacter, promoting its grilled chicken and special offers. The Spanish- language spot highlights the spices in the marinade. With a budget of $10 million for both campaigns, the company is counting on the two-pronged approach to spice up its image as it expands into new markets.
By Margaret Littman

Restauratour: Initial Offering
M&S Grill, McCormick and Schmick’s casual offshoot, shares some of its sister concept’s retro elements such as lots of wood and traditional colors. But where the seafood concept evokes the early 1900s, M&S Grill showcases an art-deco style with a lighter, more open look. The space features Tiffany-style fixtures, wood panels, smaller booths and strategically placed beveled mirrors. The company will use the design as it continues to expand M&S Grill at a pace of one or two a year in McCormick & Schmick’s markets.
By Lisa Bertagnoli

Toque Of The Town: Winning Seasons
Corporate Executive Chef Shaun Curtis is cooking up limited-time offers to help Buffalo’s Southwest Cafe soar above its wing-and-beer-joint roots to become a more polished, family-oriented, casual concept. In addition to broadening the menu, the twice yearly seasonal menus allow Curtis to create dishes based on reasonably priced commodities that might be too labor intensive for the core menu. Since their inception in spring 2003, the seasonal specials have garnered between 4 percent to 10 percent of the menu mix.
By Monica Rogers

Multiconcept Operators: Desert Passage
Arizona has proven to be fertile ground for Fox Restaurant Concepts, operator of a handful of full-service restaurants and a fast-casual pizza concept. President Sam Fox believes that if a concept can work in Arizona, it will work anywhere. With that philosophy in mind, he’s designated North, which serves modern Italian cuisine, and Sauce, which offers a limited menu of pizza, pasta and salads, as his growth vehicles. The company plans to continue to expand both concepts in Arizona while venturing into Denver; Newport, Calif.; and San Diego.
By Lisa Bertagnoli

Road Trip: Blowing into the Windy City
From trendy eateries to local hamburger joints, Dennis Lombardi, executive vice president of Chicago-based consultancy Technomic, takes Chain Leader on a tour of Chicagoland chain outlets. He offers his insight as to which full-service and fast-casual companies have helped their brands by strategically picking good sites in a market saturated with regional and national chains.
By David Farkas

Technology: Olympic Records
Athens is not the only place abuzz with Olympic fever. Taco Bueno held its own Drive Thru Olympics, awarding prizes to general managers whose restaurants saw the most improvement in drive-thru speed. It measured each transaction with a new system of timers that are connected to headquarters. As a result, the fast-casual Mexican chain saw record sales volumes, and drive-thru rates continue to improve.
By Mary Boltz Chapman

The Bernstein Perspective: Fighting Back

Editorial: Making Contact