Hello!

This week we’re covering:

• A new chain at the top of a major customer satisfaction survey

• Pizza Hut’s big sale

• And the Times Square Red Lobster is no more

Read on…

3 Numbers

11

Years that Chick-fil-A has been ranked the nation’s top-rated quick-service brand by ACSI, which releases a widely-viewed study on customer satisfaction each year. But the survey has a new winner this year, Jersey Mike’s — which scored one point higher than CFA — in its first year ever participating.

5

Number of On the Border restaurants that are still open, after owner Pappas Restaurants closed all 30 of its corporate-owned units last week. (The five remaining locations are all franchised.) The company closures cap a dramatic fall for the casual dining brand, which had 138 locations in 2021.

86

Company-owned restaurants sold by Red Robin to multi-unit franchisees. One 69-unit block was sold to Op Burgers for $62.5 million; Kuber Management scooped up 17 units in Oregon and Washington for $10 million. Red Robin has significantly trimmed its corporate store portfolio in recent months, going from 379 to 263 locations.

The Big Story

Pizza Hut has been sold. Via CNBC:

Pizza Hut arguably created Yum Brands after it became Pepsico’s first restaurant acquisition in 1977. A decade later, the beverage giant also had Taco Bell and KFC. By 1997, it had spun the concepts off into Tricon Global Restaurants, which was renamed Yum Brands five years later.

Meaning: this is a bit of a historical milestone in the industry. This will mark the first time in 40 years that Pizza Hut has not been part of the same ownership group as Taco Bell and KFC.

Pizza Hut has undoubtedly stumbled in recent years. But it’s still huge: excluding mainland China, the chain has about 15,500 units across 108 countries, and it generates over $10 billion in systemwide sales per year. Its brand recognition in the U.S. is essentially universal. And yet, LongRange Capital will pay a relatively paltry sum for the brand. Domino’s — which actually trailed Pizza Hut in systemwide sales just 9 years ago — currently carries a market cap of about $10.5 billion, roughly 7x the value of Pizza Hut’s ex-China business.

I hope that new ownership helps turn Pizza Hut around. It’s hard to not be nostalgic for the concept that gave us red-checkered tablecloths, the personal pan pizza, and Bookit certificates — some of which are probably still collecting dust underneath the childhood beds of a couple dozen newsletter readers.

Going back to its roots and shifting the concept again to full service is probably too much to ask for a real estate portfolio that’s been optimized over the past 25 years to service takeout and delivery. But it’s such a differentiator in the category, and it’d go over very well with a Millennial set who have young families now of their own. It seems very much worth a real test.

In the Headlines

• As part of a massive brand overhaul, KFC is launching its new “Dunked” menu, featuring tenders, wings, and sandwiches drenched in a line of globally-inspired sauces. It’s also releasing an updated drink platform — the (all-caps) “KWENCH” line — which will include boba refreshers and iced coffees.

• Also in its transformation era — Panera, which announced a summer menu upgrade featuring frittatas, new salads, an updated line of coffee drinks, and the return of bowls.

• Dave & Buster’s reported another tough quarter — same-store sales dropped 5.4% — but the concept has hopes that a big World Cup programming push will make for a better summer.

• Summit Acquisitions, LLC — a group of Twin Peaks franchise operators — will effectively run the brand on behalf of the bondholders who now own the concept. Summit and the bondholders have also worked out a deal in which Summit will eventually own Twin Peaks outright.

• Chick-fil-A is giving the people what they want — MORE PROTEIN — in a new menu test that includes double protein on salads and the Protein Scramble Bowl.

• Inside the bittersweet final days of the Times Square Red Lobster.

• Raising Cane’s created a mimic of SoFi Stadium for its (frankly stunning) Inglewood flagship location.

• John Daly has been tapped as a new spokesman for a concept that, as far as we know, doesn’t sell booze (Dunkin’).

• Remember the halcyon days of absolutely scorching your mouth on a lava-hot McDonald’s fried apple pie? Go ahead and relive that this summer.

• And an interesting piece on how the new McDonald’s refresher line has strained its seven decade-old partnership with Coke.

Name That Chain!

You’ve got three guesses to name this week’s chain:

• A restaurant manager and a real estate agent who'd just sold him a house pooled $4,000 and opened this 24-hour diner outside Atlanta in 1955.

• Seventy years later it's still privately held, still never closes, and runs past 2,000 locations across 25 states.

• The European mind cannot comprehend it: Along with Buc-ee’s and ranch dressing, it’s spent the past week as a subject of fascination for traveling World Cup fans.

Find the answer at the bottom of the email…

Power Moves

Here are some notable C-suite moves from the past week:

• BJ’s Restaurants announced Monika Saxena as its Brand President. Saxena was formerly an EVP at LongHorn Steakhouse.

• Pura Vida — which recently closed a private-equity investment by TSG Consumer — announced a slew of new leaders from Shake Shack, Sweetgreen, and Oakberry.

• Waffle House vet Russell Holland is Zaxby’s new Chief Development Officer.

• Blaze Pizza tapped Lucas Bravo as its new CFO.

Thanks for reading! I’ll see you next week.

NAME THAT CHAIN ANSWER: Waffle House