NYC's law forcing on-menu calorie disclosure impels compliance plans

Nation's Restaurant News, May 12, 2008 by Elissa Elan

NEW YORK -- As this city's long-contested regulation took effect May 5 requiring the on-menu posting of calorie counts for every food and drink item at local branches of chains with 15 or more units, many operators still were grappling with how best to present the information, including for all alcoholic beverages.

A three-judge federal appellate panel on April 29 denied the New York State Restaurant Association's request for an extended stay pending its appeal of a lower court ruling allowing the city's Department of Health and Mental Hygiene to begin enforcing the law, which originally was slated to take effect last summer. Health department officials said they would not impose any fines until Friday, July 18, at 12:01 a.m., in order to give operators more time to comply.

Conforming to the rule has not been easy, operators said. Chief among their concerns are designing menu boards that are clear, legible and easy to understand and making sure nutrition information appears everywhere it should. Complicating these efforts are the logistics of posting calories for limited-time offers that are available for more than 30 days and looking ahead to the costly possibility that operators could face a patchwork of labeling-related laws.

San Francisco's menu-labeling law is slated to take effect July 1, and another nutrition-posting law is expected to go into effect in Seattle-anchored King County, Wash., in August. Meanwhile, at least eight states and municipalities are considering similar laws, making it increasingly difficult for chain operators to dodge the issue.

"The big challenge has been adding [the information] everywhere in the cafes where it had to show up," said Ed Frechette, director of marketing for Au Bon Pain, the 221-unit bakery-cafe chain. "Things like bakery ID tags, where the information had to be, [were problematic, as were things] on the bakery shelves, where we're now required to put caloric content. Right now, we're just going to use stickers, but we don't know if that will work."

Frechette, who said the rule affects operations at approximately 40 of the chain's stores, noted that trying to come up with the right menu board design for its espresso drink line also has been challenging.

"That's the one panel that is a real mess," he said, "because there are multiple sizes [of drinks] listed at different price points, so there are a lot of numbers on the board, a lot of mishmash."

Officials at Miami-based Burger King Corp. said one of the biggest challenges for its 93 New York-based franchised restaurants has been redundancy.

"In New York City, they did not issue a compliance guide until very recently," said Craig Prusher, BK's vice president and assistant general counsel. "This made it difficult for us to match [the requirements] with our business model. I don't think the city necessarily understood that anywhere you have a product's name and price posted it's considered a menu item. So because of that we have had to put a caloric value on it."

As a result, Prusher continued, "there basically are some redundancies where caloric values are displayed at the restaurants. It's on our menu boards, on the visuals for the value meals, on the highlighted promotional spots, and also in areas away from the menu board, such as the counter area, around the registers, the queue line and the drive-thru section of the building."

Hector Munoz, BK's senior director of national restaurant merchandising, said the cost of changing the menu boards was $2,000 per store and could reach as much as $5,000. He further noted the company is concerned the clutter created by smaller type and additional information will confuse customers, which could result in them ordering items they are familiar with rather than perusing the entire menu.

Munoz also said the promotional items are turning into something of a logistical nightmare since they are featured only for 30 to 60 days. Because of those time frames, the menu boards will have to be changed each time a new product is introduced.

"The average time for a promotion is between four and five weeks, or roughly every 30 to 45 days," he said. "Now if you ran a new product for 29 days, you wouldn't have to change the menu board; that's only for products in restaurants 30 days or more--that's when they're considered standard menu items and must be in compliance with the law."

Burger King's Prusher indicated an even bigger wrinkle could result if each municipality has its own set of caloric and nutritional requirements, thus hampering the ability to provide continuity of information.

He added that the cost could be even more than anticipated "depending on what happens in Washington state and whether we're forced to display information other than caloric content."

"If it [affects] less than 93 restaurants--say it's 50--it could cost more on a per-restaurant basis," he said. "When you have a larger base of restaurants you can amortize the cost."

Dunkin' Brands Inc., parent of Dunkin' Donuts and Baskin-Robbins, said Dunkin' Donuts' new menu boards now feature two additional panels containing caloric content. A new hardware topper also is being installed on the chain's drive-thru menu boards.