Sandwich players’ latest promotions pitch value, health, loyalty

Value has been on the minds of the Second 100’s sandwich players more than usual because of the slowing economy, and that consciousness has become a major driver of menu strategies.

Whether they specialize in sub or deli-style sandwiches, burgers, taco or burritos, second-tier chains in the segment are targeting frequent users by offering special promotions and constantly adding new products. Some are bringing back popular limited-time offers from the past instead of concocting new ones.

“You need to have a value in a lunch offering whether the economy is good or going through a rougher patch,” says Jeff Smit, president of Blimpie Subs & Salads, which is owned by Scottsdale, Ariz.-based Kahala Corp.

Blimpie’s current value promotion is its large, 12-inch sub in four varieties for $5 instead of its normal $7.50 to $8.50 price. Same-store sales rose 10 percent in just the first three weeks of the promotion, Smit says.

On the premium side, Blimpie is rolling out a new Super Stack sandwich that has double the quantity of meat for less than double the price. For smaller appetites, Blimpie is testing mini subs, called Deli Sliders, in those Wal-Mart stores where it operates and in “one of our core markets,” Smit says.

Schlotzsky’s Deli also is testing smaller portions that are partially aimed at slower times of the day when customers may be seeking between-meal snacks. Chief executive Kelly Roddy says the test is in the very early stages and is expected to broaden the customer base to those consumers who shy away from a $9 check average.

The chain also is expanding its co-branding strategy with sister chains Cinnabon and Carvel to boost sales in the breakfast and afternoon dayparts, Roddy says.

Several chains are extending their salad lines, both with permanent and limited-time formats because of increased consumer interest. Qdoba Mexican Grill, for instance, is “enhancing salads year-round,” says spokeswoman Karen Guido, noting that many of the salad ingredients also are used in Qdoba’s signature burritos. A new salad expected to become a permanent addition is the Ancho Chile BBQ Salad, and last summer’s Grilled Chicken Mango Salad has temporarily reappeared.

SANDWICH CHAINS RANKED BY U.S. SYSTEMWIDE SALES U.S. SYSTEMWIDE FOODSERVICE SALES*(BY FISCAL YEAR, IN MILLIONS) *Actual results, estimates or projectionsSource: NRN research


LATEST-YEAR RANK	PREC.-YEAR RANK	CHAIN	FISCAL YEAR-END
LATEST	PRECEDING	PRIOR
1	1	Krystal	Dec. ’07	$440.6	$445.5	$422.6
2	3	Jason’s Deli	Dec. ’07	427.3	372.3	330.0
3	2	Checkers	Dec. ’07	411.0	400.7	396.7
4	7	Qdoba Mexican Grill	Oct. ’07	348.0	265.0	220.0
5	4	Baja Fresh Mexican Grill	Dec. ’07	345.0	342.0	359.0
6	8	McAlister’s Deli	Dec. ’07	306.9	260.0	207.1
7	12	Moe’s Southwest Grill	Dec. ’07	290.0	230.0	184.0
8	6	Taco John’s	Dec. ’07	281.0	278.0	253.0
9	5	Blimpie Subs & Salads	Dec. ’07	270.0	317.9	327.4
10	9	Wienerschnitzel	Dec. ’07	252.7	251.0	240.0
11	11	Taco Cabana	Dec. ’07	243.8	232.3	218.0
12	10	Rally’s Hamburgers	Dec. ’07	242.7	248.3	236.0
13	15	Johnny Rockets	April ’08	231.0	209.0	199.2
14	13	Schlotzsky’s Deli	Dec. ’07	230.0	214.0	210.0
15	14	Braum’s Ice Cream & Dairy Stores	Dec. ’07	210.8	210.0	206.5
16	16	A&W All American Food	Dec. ’07	200.0	200.0	200.0
17	17	Taco Bueno	Dec. ’07	197.7	173.2	158.6
		TOTALS:		$4,928.5	$4,649.2	$4,368.1

SANDWICH CHAINS RANKED BY GROWTH IN U.S. SYSTEMWIDE SALES(Year-to-year percentage change) *Actual results, estimates or projectionsSource: NRN research


LATEST-YEAR RANK	PREC.-YEAR RANK	CHAIN	FISCAL YEAR-END	*LATEST VS. PRECEDING**	*PRECEDING VS. PRIOR**
1	3	Qdoba Mexican Grill	Oct. ’07	31.32	20.45
2	2	Moe’s Southwest Grill	Dec. ’07	26.09	25.00
3	1	McAlister’s Deli	Dec. ’07	18.04	25.54
4	4	Jason’s Deli	Dec. ’07	14.77	12.82
5	6	Taco Bueno	Dec. ’07	14.15	9.21
6	10	Johnny Rockets	April ’08	10.53	4.92
7	12	Schlotzsky’s Deli	Dec. ’07	7.48	1.90
8	7	Taco Cabana	Dec. ’07	4.95	6.56
9	14	Checkers	Dec. ’07	2.57	1.01
10	5	Taco John’s	Dec. ’07	1.08	9.88
11	17	Baja Fresh Mexican Grill	Dec. ’07	0.88	-4.74
12	11	Wienerschnitzel	Dec. ’07	0.68	4.58
13	13	Braum’s Ice Cream & Dairy Stores	Dec. ’07	0.38	1.69
14	15	A&W All American Food	Dec. ’07	0.00	0.00
15	8	Krystal	Dec. ’07	-1.10	5.42
16	9	Rally’s Hamburgers	Dec. ’07	-2.26	5.21
17	16	Blimpie Subs & Salads	Dec. ’07	-15.07	-2.90
		AVERAGE:		6.73	7.45

Blimpie, too, is introducing more salads, including antipasto, chicken Caesar and club versions, all with an upgraded romaine and iceberg lettuce blend.

An all-you-can-eat salad bar, $6.79, is Jason’s Deli’s answer to demands for value and lower-fat, lower-calorie foods.

Sister drive-thru chains Checkers and Rally’s Hamburgers began the year with the launch of their Double Value Menu, featuring 10 items starting at $1, including seven double burgers, chicken and fish sandwiches, or combo choices priced at two for $3, $4 or $5.Among new items are additions to the chains’ toasted-melts line, as well as the Philly Cheese Steak Burger and the Texas Toast A1 Cheddar Burger.

Krystal is just starting to test miniature toasted sandwiches on Texas toast instead of hamburger buns and also has been selling a lot of new drinks and shakes, including new flavors of its Krystal Freeze and Krystal MilkQuake.

SANDWICH CHAINS RANKED BY NUMBER OF U.S. UNITSYEAR-END NUMBER OF UNITS**Actual results, estimates or projectionsSource: NRN research


LATEST-YEAR RANK	PREC.-YEAR RANK	CHAIN	FISCAL YEAR-END
LATEST	PRECEDING	PRIOR
1	1	Blimpie Subs & Salads	Dec. ’07	1,233	1,583	1,637
2	2	Checkers	Dec. ’07	484	461	445
3	3	Taco John’s	Dec. ’07	431	430	410
4	10	Qdoba Mexican Grill	Oct. ’07	395	318	250
5	5	Krystal	Dec. ’07	391	403	420
6	9	Moe’s Southwest Grill	Dec. ’07	383	324	267
7	4	A&W All American Food	Dec. ’07	371	406	449
8	7	Wienerschnitzel	Dec. ’07	356	355	344
9	6	Schlotzsky’s Deli	Dec. ’07	355	385	378
10	8	Rally’s Hamburgers	Dec. ’07	340	351	354
11	11	Baja Fresh Mexican Grill	Dec. ’07	291	298	299
12	12	Braum’s Ice Cream & Dairy Stores	Dec. ’07	274	276	285
13	13	McAlister’s Deli	Dec. ’07	246	218	181
14	14	Johnny Rockets	April ’08	194	177	166
15	15	Taco Bueno	Dec. ’07	187	165	145
16	16	Jason’s Deli	Dec. ’07	177	158	144
17	17	Taco Cabana	Dec. ’07	150	146	140
		TOTALS:		6,258	6,454	6,314

SANDWICH CHAINS RANKED BY GROWTH IN NUMBER OF U.S. UNITS(Year-to-year percentage change) *Actual results, estimates or projectionsSource: NRN research


LATEST-YEAR RANK	PREC.-YEAR RANK	CHAIN	FISCAL YEAR-END	*LATEST VS. PRECEDING**	*PRECEDING VS. PRIOR**
1	1	Qdoba Mexican Grill	Oct. ’07	24.21	27.20
2	2	Moe’s Southwest Grill	Dec. ’07	18.21	21.35
3	4	Taco Bueno	Dec. ’07	13.33	13.79
4	3	McAlister’s Deli	Dec. ’07	12.84	20.44
5	5	Jason’s Deli	Dec. ’07	12.03	9.72
6	6	Johnny Rockets	April ’08	9.60	6.63
7	9	Checkers	Dec. ’07	4.99	3.60
8	8	Taco Cabana	Dec. ’07	2.74	4.29
9	10	Wienerschnitzel	Dec. ’07	0.28	3.20
10	7	Taco John’s	Dec. ’07	0.23	4.88
11	14	Braum’s Ice Cream & Dairy Stores	Dec. ’07	-0.72	-3.16
12	12	Baja Fresh Mexican Grill	Dec. ’07	-2.35	-0.33
13	16	Krystal	Dec. ’07	-2.98	-4.05
14	13	Rally’s Hamburgers	Dec. ’07	-3.13	-0.85
15	11	Schlotzsky’s Deli	Dec. ’07	-7.79	1.85
16	17	A&W All American Food	Dec. ’07	-8.62	-9.58
17	15	Blimpie Subs & Salads	Dec. ’07	-22.11	-3.30
		AVERAGE:		2.99	5.63

Many companies continue to eliminate trans fats, with Qdoba, Blimpie and Jason’s Deli recently reaching their goals of having 100-percent trans-fat-free menus. While only New York City and a couple of other municipalities require chains to be completely free of the artificial oils most chains have voluntarily found alternative substitutes for them for use in all of their locations.

Qdoba is promoting both value and its new loyalty program this summer by offering program participants a free entrée after buying five, instead of the 10 normally required.

“We recognize that times are pretty tough right now, and we want to do something to help ease the pain,” Guido says.

Second 100 chains see slowed sales growth for second consecutive year

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