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Nation's Restaurant News, Dec 22, 2003 by Ron Ruggless

About the best that can said of this past year in foodservice is that it brought us "freedom fries" as the patriotic substitute for French fries.

In foodservice, some years are marked by births of new ideas, dramatic changes in technology and operations, profound advances in culinary techniques or an economy that's as robust and rosy as a Biggie-size child.

But in 2003 foodservice operators wrestled instead with the Three Ws: war, weight and worries about the economy.

The long, slow-motion run-up to the War in Iraq in March made consumers and operators nervous in an already sluggish economy. And lawyers and health activists were putting the industry in its crosshairs for what they alleged were its contributions to the nation's obesity problem.

Amid all the fretting, Rocco DiSpirito, chef-owner of Union Pacific in New York, brought the trials and tribulations of running a dining operation into the living rooms of America with his television reality show, "The Restaurant."

What follows is Nation's Restaurant News' abridged version of the Reality of 2003--the high points, low points and many of the points in between.

With the cold-war-of-words with the French starting to thaw, all we can say about foodservice in this past year is ... C'est la vie!

JANUARY

Nervously anticipating what promised at the outset to be an eventful year, restaurant operators started 2003 in a cautiously optimistic mood peppered with pessimism.

The National Restaurant Association's annual forecast predicted a 1.8-percent real growth in food and drink sales in the year ahead. The NRA projected that industry sales would reach a total of $426.14 billion during the year.

NRA officials warned, however, that 2003 would be a "threshold" year. Critical, they said, were the federal government's efforts to stimulate the economy.

Many operators worried about the budget shortfalls confronting many states. They feared cash-strapped state governments would raise taxes and fees, such as those for liquor licenses and health department permits.

"Everything is on the table," said Rick Sampson, chief executive of the New York State Restaurant Association.

The nation's attention shifted also to obesity.

A federal judge in New York dismissed a highly publicized lawsuit against McDonald's Corp. that blamed the chain for causing obesity in children. In tossing out the suit, the judge said the plaintiffs failed to show that McDonald's products involve a danger unknown to the public.

"Common sense has prevailed," said Walt Riker, McDonald's spokesman. "We said from the beginning that this was a frivolous lawsuit." The complaint was filed in 2002 on behalf of overweight children who sought unspecified damages for such health problems as diabetes, coronary heart disease, high blood pressure and high cholesterol.

The financial woes of the struggling airline industry led LSG Sky Chefs of Arlington, Texas, to experiment with selling meals directly to passengers. Programs were tested on some America West and Northwest Airlines flights. United Airlines, which filed for bankruptcy protection from creditors in 2002, announced it would stop serving food on most flights of fewer than three hours. Other operators, such as T.G.I. Friday's, began testing take-aboard-meal sales at airports later in the year.

The cafeteria segment continued to show signs of stress when Furr's Restaurant Group of Richardson, Texas, filed for Chapter 11 bankruptcy protection.

Bradley Blum assumed his new post as chief executive of Miami-based Burger King Corp. He was recruited by the new owners of the No. 2 burger chain, who had closed their deal in late 2002. Robert T. Nilsen, former Taco Bell Corp. chief operating officer, was hired as president.

Carlson Restaurants Worldwide ramped up expansion of its Pick Up Stix brand and continued to divest itself of such "emerging brands" as Samba Room and Star Canyon. Twelve of Carlson's 14 remaining "emerging" restaurants were purchased by E-Brands Acquisitions of Orlando, Fla.

Eatzi's Market & Bakery creator Phil Romano created a new management team at the gourmet-meal concept after buying out Brinker International's half of the joint venture in late 2002.

And Bojangles' Famous Chicken 'n Biscuits owner, Joe Drury, made public his intentions of rebuilding the 300-unit chain based in Charlotte, N.C.

Jack in the Box Inc. started the year with a new acquisition. The San Diego-based burger chain acquired the 85-unit Qdoba Mexican Grill of Denver for $45 million.

S. Prestley Blake, co-founder of Friendly Ice Cream Corp., filed a lawsuit seeking to force company president Donald Smith to release documents related to his use of an airplane owned by the company, which operates and franchises the 549-unit Friendly's family-dining chain.

Chicago chef Charlie Trotter discontinued his plans to open a fine-dining restaurant in London; a spokesman said the delays were making the project look as if it never would happen.

Several white-tablecloth operators adopted early-bird promotions to appeal to time-conscious, budget-minded guests in the soft fine-dining economy. "Our staff are here anyway, so we're taking advantage of an available opportunity," said Philippe Haddad of Philippe's Bistro in Atlanta's Buckhead district. He was offering a $20 early-bird menu from 5:30 p.m. to 7 p.m.