Noodles & Company plans to remove all artificial colors, flavors and preservatives from its soups, sauces and dressings by the end of the third quarter this year, the company said Tuesday, joining a growing number of restaurants to announce the removal of artificial ingredients from their menus.
The chain is also testing naturally raised, antibiotic-free chicken in some restaurants in Colorado, and is working with suppliers to make the switch systemwide over this year and next, Noodles & Company president and chief operating officer Keith Kinsey said during a call Wednesday discussing first-quarter earnings. The chain already uses antibiotic-free, vegetarian-fed pork.
“I think the quality of ingredients non-processed are very, very important. So all the work that our supply chain team has done and continues to do, I think just supports a strong story and positioning about ingredients that still is a differentiator today,” said Kevin Reddy, Broomfield, Colo.-based Noodles & Company’s chairman and CEO.
More chains — and the overall U.S. agricultural system — will move in that direction, Reddy predicted.
On Tuesday, Panera Bread Co. reiterated its efforts to remove artificial additives and enhance transparency, and issued a “No No List” of ingredients.
Last week, Chipotle Mexican Grill Inc. said it had removed genetically modified ingredients from its dishes where possible. And in March, McDonald’s said it planned to stop selling chicken treated with human antibiotics over the next two years.
Noodles & Company is also testing initiatives to streamline and simplify kitchen operations to speed throughput, a challenge for the brand known for dishes cooked to order.
Operational changes will roll out starting in July, Reddy said, including the standardization of ingredients and recipes, to allow for easier training and more consistency.
The chain has also developed a mobile ordering and payment app and online systems that are expected to speed service, as well as provide feedback on guest segmentation and targeting.
“Additional insight into guest behavior will allow us to better engage and deploy relevant marketing campaigns,” Reddy said.
The company has hired the ad agency Barkley, which is scheduled to debut new marketing messages in the second half of the year that will focus on Noodles & Company’s cooking from scratch with real ingredients and family-friendly focus, Reddy said.
“We will be more active in media spend, social digital presence and promotional activity than ever in the past,” he said.
The 455-unit chain has been working to build brand awareness as it grows. This year, Noodles & Company expects to open 50 to 60 units, and will likely pass the 500-unit milestone before the end of the year.
Reddy said the development pipeline next year will shift to existing markets, which will allow the company to build stronger brand awareness.
Three markets in particular hampered same-store sales in the first quarter: Colorado, Washington, D.C., and Austin, Texas.
Reddy said the chain’s performance in its home market of Colorado was strong, but growth in the fast-casual segment there has created more competition. Noodles & Company’s restaurants there are also older and need a refresh, he said.
Washington, D.C., was difficult because of internal staffing and operational problems that have improved, he said.
Austin is a market where consumers favor independent restaurants. Noodles & Company has added a field marketing specialist to help restaurants get more involved in the community, as well as a native multi-unit manager, who will work on the market’s resistance to a national brand, he said.
Reddy noted that Noodles & Company, which celebrates its 20th anniversary this year, is showing strength in a broad swath of geographic areas. The top 20 restaurants in terms of sales span 13 geographic markets, he said, and units in the new markets of Phoenix, Orlando, Fla., and Montana have had exceptional openings.
Noodles & Company is a high-growth concept with an initial footprint in more than 30 states, with the ability to expand to about five times its current size while gaining economies of scale, Reddy said.
“High growth always comes with risks, and our growing pains are primarily associated with three markets that we are approaching aggressively to return to the success of the balance of the country,” he said.