News

QSR going head to head with Fast Casual

February 4, 2003

DENVER (Feb. 5)- If you stand in front of 550 Broadway at high noon any weekday, you'll see a major new dining phenomenon unfold. On foot and by car, in pairs and alone, the dreadlocked young and graying baby boomers start making a beeline to this urban strip mall from offices and classrooms around downtown Denver. They stream into Chipotle Mexican Grill, Noodles & Co., Il Vicino and the array of restaurants packed into this location, looking to eat a free-range pork-carnitas burrito or a bowl of spicy pad Thai noodles with shrimp or a veggie-topped wood-fired pizza. And they expect to eat lunch in 20 minutes or less. It may not be immediately apparent, but this busy corner — and the neighboring areas that house Baja Fresh, Kokoroo, Qdoba, Boston Market, Thai Wraps @Tuk Tuk and others — is the epicenter of an American dining revolution. The restaurant industry has coined the moniker "fast casual" to categorize the new breed of eatery that serves fresh, made-to-order meals in a minimum of minutes. The fast-food giants have another term for this fast-growing slice of the eating-out pie: trouble. They're shaking in their supersize boots because what they see in Denver confirms what their private statistics had already told them. It's the sight of Americans turning their collective backs on the cheeseburgers they grew up on. It's not a mathematical absolute, but there may well be more fast-casual eateries concentrated in this large square block than any other place on the planet. According to industry sources, there are more restaurants under the fast-casual umbrella operating in Colorado than in any other state.Winning the women's voteA recent survey by Technomics — an independent restaurant- research firm in Chicago — reported that 38 percent of Denver consumers had visited a fast-casual restaurant over a two-month period, the highest "visitation incidence" in the nation. Also, 18- to 34-year-olds are the most frequent visitors, and more than half of those are women. As they ate lunch on the sunny patio outside 550 Broadway one recent Monday, Carissa Fralin, 33, and her friend Tracy Olson, 31, laughed at the idea that they're trendsetters. Fralin was enjoying a bowl of Roma-tomato marinara from Noodles & Co. while Olson munched on a chicken burrito from Chipotle Mexican Grill. "It's good food for just a little bit of money. It doesn't add a lot of fat and calories. It's much better than a Big Mac," said Fralin. "We come here a lot. What kind of mood are we in today? Chipotle or Noodles? If one place is busy, we go to another."Olson said she's a strict vegetarian. "The fact that I can get vegetarian, healthy choices at both places is important to me," she said, adding that she's not surprised that the fast-casual phenomenon has taken off in Colorado. "People here live a little healthier. It's the weather. You're out more," she said. It's not far-fetched to say that fast-casual dining is one trend Colorado can call its own. Chipotle Mexican Grill is headquartered in Denver. Noodles & Co. calls Boulder home. Qdoba Fresh Mexican Grill — originally called Zuma — opened its first outlet in 1995 on East Sixth Avenue. Its corporate offices are in Wheat Ridge, and both Boston Market and Einstein's Bagels are run from Golden. That doesn't include smaller chains like Paradise Bakery and Cafe (started in Aspen) and smaller local eatery groups like Tokyo Joe's, Kokoro and Illegal Pete's Burritos.In the Denver metro area, it's not unusual to see two or three of these restaurants grouped in the same mall along with Panera Bread or Wahoo Fish Tacos. They appeal to the same variety-craving demographic. Apparently, that slice of society even includes Ozzy Osbourne. A recent episode of MTV's The Osbournes showed the doddering heavy- metal daddy — best-known for biting the head off a bat — chomping down on one of his favorite foods: a big Chipotle burrito. Although these eateries are growing by leaps and bounds even as many high-end fine-dining establishments are struggling, fast casual is still only a small slice of America's gigantic dining pie — only 2 percent, or $5 billion, of the total United States restaurant sales in 2001, according to Technomics. However, the report also notes that the fast-casual industry has "sourced the majority of its business from traditional fast service restaurants." In other words, consumers are suffering fast-food fatigue and are abandoning the Golden Arches in droves. McDonald's recently suffered the first losing quarter in its history.If you can't beat 'em . . .After unsuccessfully trying to underprice the competition out of existence, the fast-food companies decided to buy into them. Since 1998, Chipotle has allowed McDonald's Corp. to slowly buy a bigger and bigger share of the company. Now the fast-food conglomerate owns 89 percent of the big burrito purveyor. Company founder Steve Ells says the McDonald's folks have wisely left Chipotle to do its own hip thing in Colorado. The 36-year-old Ells — who graduated from Boulder High, the University of Colorado and the Culinary Institute of America — originally had no intention of starting a chain. "The idea came to me when I was working in San Francisco at Stars restaurant for (acclaimed chef) Jeremiah Tower. I loved going to a little taqueria there that served rolled-up burritos made fresh to order. Most of the burritos I'd seen were smothered. It was great because you could eat it from the top and peel the foil off like a banana. If I could open one of these places, I'd serve burritos filled with marinated meats and great ingredients," he said recently as he munched on a tortilla-less burrito bol at his shop at 550 Broadway. He looked to his father for funding for his first eatery. "He said: 'You went to a great culinary school. You work at one of the greatest restaurants in America for one of the best chefs and you want to sling burritos?' I said I just wanted to serve food that I liked," Ells recalled.The first Chipotle — named after the smoked jalapeno pepper — opened on East Evans Avenue in Denver in July 1993. There are 235 Chipotle restaurants operating nationally, Ells says, with more opening every week.Noodles: a common threadThe path was a little more conventional for another homegrown Colorado success. Aaron Kennedy, 39-year-old founder and owner of Noodles & Co., earned an MBA from the University of Wisconsin before following a career that included a stint at Hormel Foods working on a then-new product called Lunchables. Kennedy was living in New York City and eating at tiny fresh- noodle shops when his flash of inspiration came. "I loved all Asian noodles, but I had to go to a Thai restaurant to get pad Thai and a Japanese place to get yakisoba. There are noodle dishes all over the world — basic comfort-food dishes that appeal to everybody. I thought: 'What if they were all on one menu? Why not bring all of these influences together and make it affordable and fast,' " Kennedy said as he sat in the Noodles & Co. restaurant on North Broadway in Boulder. The first Noodles & Co. was opened in Madison, Wis. The second meal-on-the-run store opened in Cherry Creek North in October 1995. The still-independent company now operates 60 restaurants, with 30 more shops scheduled to open in 2003. The noodle master said it makes sense that so many fast-casual restaurant entrepreneurs flourished in Colorado. "I sought a lifestyle that was healthy, outdoor-oriented, active and energetic and a place that was inspiring. I found that here in Colorado. So it's a suitable environment to start restaurants that serve fresh, quality food," he said. His company is still privately held. Following the lead of McDonald's (which also owns Boston Market), Wendy's bought the Baja Fresh Mexican Grill and Cafe Express chains. Last week Jack in the Box paid $45 million to buy Qdoba Fresh Mexican Grill. No matter how fast casual develops, the dining-out market is growing only as our collective palate gets more sophisticated, our need for healthier fare increases and our Daytimers grow more crowded. A recent AC Nielsen consumer survey found that 50 percent of household heads describe themselves as "too exhausted to cook." The percentage of the average family's food dollar spent away from home is already 46 percent and is expected to grow to over 53 percent by 2010. For busy parents, fast-casual eateries are the answer to several pressing needs. As Mike van Gortler, 45, and his 12-year-old daughter Makana ate dinner at the North Boulder Noodles & Co. at 6 p.m. on a recent day, seven other tables in the restaurant included children. "I don't like the thought of my kid eating a lot of grease. For about the same amount of money you'd spend at McDonald's, you get fast service and good food here," he said.A fast-casual samplerStopping by a fast-casual eatery on a snowy evening — or a hot night for that matter — has become an integral part of life for many locals, myself included. When I'm not out reviewing the foie gras torchon at Vega or buffalo prime rib at Ted's Montana Grill, I'm trying to figure out what to feed my almost- 9-year-old son for dinner. When I don't feel like cooking, you are likely to find us at Noodles & Co. eating bowls of lo mein and macaroni and cheese. It ain't gourmet but it's not priced gourmet either. While I normally shy away from reviewing chain restaurants, I've ended up sampling the fare at many of the top quick-casual restaurants through the years.Here are a few dishes worth recommending:Noodles & Co.: My favorite dish is the Wok-seared lo mein ($5.25 plus $1.45 to $1.95 for chicken, beef, tofu or shrimp). The noodles are shipped fresh from the maker in Brooklyn. They are sauteed with a slightly salty soy and oyster sauce and a bare hint of heat topped with bright green baby bok choy cabbage, thin crispy carrot slices, and black sesame seeds. I like it with chicken and an extra spurt of sri racha chili sauce.Chipotle Mexican Grill:Nothing beats the Fajita burrito ($5 to $5.50) stuffed with steak or fall-apart Niman Ranch pork carnitas, plus cilantro-lime rice, real guacamole, crisply sauteed fresh bell pepper and onion, quality shredded cheese and one of four salsas — my favorite is the roasted chile corn salsa. Also recommended: the chipotle pepper marinated grilled chicken soft flour tacos ($5).Qdoba Fresh Mexican Grill:It might not be as authentic as the green chile stew served at New Mexican eateries, but I like Qdoba's Tortilla soup ($2.29). The chicken-based winter warmer is packed with roasted green chiles, onions and stewed tomatoes. Chunks of chicken, tortilla chip strips, shredded cheese and sour cream can be added to make the soup a meal. I only wish the soup came in a larger size.· Panera Bread Company:It may be made at a chain, but the Frontega chicken panini ($5.99) is a genuine treat. Lots of smoked white chicken pieces plus mozzarella, tomato, and red onion are layered between slices of chipotle mayo-smeared onion foccacia bread and press-grilled. The quality of the ingredients in Tuk Tuk's Panang chicken wrap ($5) make it a hand-food gem. A soft flour tortilla is wrapped around excellent chicken in spicy coconut milk curry sauce with basmati rice, crisp bell pepper, basil and chopped peanuts.· Kokoro Japanese Restaurant:One of the most satisfying Asian meals-in-a-bowl is Kokoro's Splash Bowl ($4.58). The soy and sesame oil-spiked broth is filled with noodles, fish cake, fried tofu, seaweed, shiitake mushrooms, boiled egg, and green onions.· Il Vicino Wood Oven Pizza:You order your Salsiccia pizza ($6.75) at the front counter and about 6 minutes later a thin fresh-crusted creation arrives hot at your table topped with quality pepperoni, ground sausage, tomato, marinara sauce, mozzarella and oregano. · Thai Wraps @ Tuk Tuk:The quality of the ingredients in Tuk Tuk's Panang chicken wrap ($5) make it a hand-food gem. A soft flour tortilla is wrapped around excellent chicken in spicy coconut milk curry sauce with basmati rice, crisp bell pepper, basil and chopped peanuts.Names of the gameHere are the major players in the fast-casual eatery business. The average meal is typically $5 to $9.Baja Fresh Mexican Grill:Taco and burrito chain; three Denver area locations, including 555 Broadway.Boston Market:Comfort-food chain; located throughout Colorado. Chipotle Mexican Grill: Big burrito chain; 16 in Denver, including 550 Broadway. CiCi's Pizza: The pizza and salad buffet chain; two local restaurants, including 14000 E. Mississippi Ave.Corner Bakery:Bakery/cafe chain; one Colorado location at the Denver Pavilions.Fazoli's Italian Restaurants:Italian food chain; 16 Colorado locations, including 6460 E. Yale Ave.Il Vicino Wood Oven Pizzas:Upscale pizzeria chain; two Colorado locations, including 550 Broadway.Kokoro:Denver-based quick Japanese chain; four local restaurants, including 555 Broadway.Noodles & Co.:Boulder-based global noodle- dish chain; 24 Colorado outlets, including 550 Broadway.Panera Bread:Sandwich/soup/salad and pastry cafe; five Denver area shops including, 1330 Grant St.Paradise Bakery & Cafe:National sandwich and salad chain; six Colorado stores, including one on the 16th Street Mall.Qdoba Fresh Mexican Grill:Burrito and taco chain; 27 Front Range locations, including 1533 Market St.Rubio's Fresh Mexican Grill:Taco and burrito chain; four Colorado locations, including Flatiron Crossing.Tokyo Joe's:Denver-based rice and noodle bowl eateries; three local shops, including 1350 Grant St.Tuk Tuk Thai:Quick Thai eatery; three metro locations, including 605 Grant St.Wahoo Fish Tacos:The hip, young taqueria chain; seven Colorado locations, including 1521 Blake St.