News Briefs

Consumers' penchant for eatint out is fueling overall industry growth.

The total restaurant category — including full-service and limited-service restaurants — is projected to grow 0.6%  on top of 0.8% in 2023, according to the International Foodservice Manufacturers Association (IFMA) 2023 estimates and its latest 2024 Food Away-From-Home (FAFH) Industry and Segment Projections report.

Quick-service restaurants, which have performed significantly better in recent years than other segments overall, are projected to grow 0.7%. The fast-casual segment shows bullish growth of 0.9 percent. The casual dining segment continues to grow, at a projected real rate of 0.5%.

Midscale restaurants are the only major restaurant segment where IFMA projections a decline of 0.7%. 

In other findings, the food away-from-home industry  will grow 0.9%, on a real basis, in 2024, following better-than-expected growth of 1.2%, on a real basis, in 2023.  Looking ahead to 2025, IFMA projects that the food away-from-home industry will have 1.3% real growth. The total restaurant category is expected to grow 0.9%, while the total on-site category is projected to grow 2.2%, on a real basis.  

Collectively, on-site segments in 2024 are projected to grow 2%, largely because their recovery from 2020 was slower than that of restaurants. The college & university and lodging segments are expected to lead on-site growth at 3.0 and 2.8%, respectively. The business and industry segment continue to struggle.

Digital Brands Group is making its move into brick-and-mortar.

The company, whose portfolio of digital-first lifestyle apparel brands includes Sundry and Bailey 44, plans to open its first retail store in the first half of April, at Simon Premium Outlet Mall in Allen, Texas. It plans to open 50 stores during the next several years. 

Digital Brands Group (DBG) forecasts the store will generate more than $1.5 million in annual revenue and over $500,000 in annual cash flow based on the historical performance of the location and excess Sundry inventory. (The company noted it received a significant amount of excess inventory with its Sundry acquisition, which was completed in late 2022).

DGB said it will use store to clear excess inventory at “meaningfully” higher margins than selling into the off-price channel.

"We are excited to begin the retail store phase of our growth strategy,” said Hil Davis, CEO of Digital Brands Group. “We believe the best performing retail brands will have three legs to their growth story: (1) wholesale, (2) e-commerce and (3) retail stores.” 

Digital Brands’ portfolio includes the following brands:

•Bailey 44, a contemporary women’s brand whose on-trend designs specialize in the “date night” category;

•DSTLD, a premium denim brand;

•Harper & Jones, a “made-to-measure” suiting and sportswear brand for men;

•Stateside, a womenswear label crafted with all-natural fabrics; and 

•Sundry, which offers casual wear for the beach or a summer night out. 

The intangible assets, including 200-plus trademarks, of Zulily are on the block.

Hilco Steambank is selling the assets which, in addition to the trademarks, include domain names (including Zulily.com), customer data, social media assets and code for the Zulily proprietary app. The deadline for indications of interest in acquiring the assets is March 13, 2024.

Launched in early 2010, Zulily featured a flash sale events model, with thousands of products on its website and app for a limited time and quantity at a significant discount. The company, which had a peak market cap of $7 billion in 2014, generated $666 million in sales in 2023, the same year after parent company Qurate Retail Group, whose brands include QVC, HSN, Ballard Designs and others, sold Zulily to investment firm Regent for an undisclosed sum.

In December, Zuilly said it was going out of business. In late May 2023, Qurate Retail Group, whose brands include QVC, HSN, Ballard Designs and others, sold Zulily to investment firm Regent for an undisclosed sum.

"Zulily targeted an attractive audience – discount shoppers looking for the best deals on women's and kids' apparel, footwear, and home goods – of which there are over 2.5 million that made a purchase in 2023,” said Richelle Kalnit, senior VP, Hilco Streambank, a division of Hilco Global. "A buyer of Zulily's IP will have a prime opportunity to reengage these customers and to build on the Zulily brand recognition, including over 6.4 million social media followers across platforms, to acquire new ones."

Interested parties can contact Hilco Streambank at [email protected].

Benihana Inc. is expanding its footprint with new locations slated to open in Florida and California.

The Japanese hibachi and sushi restaurant chain has opened its newest sushi location in Miami’s affluent Brickell neighborhood. The 1,280-sq.-ft. Benihana RA Sushi Brickell will offer dine-in, take-out and delivery options.

"It's an honor for us to be a part of one of the most well-respected brands in the United States and debut the new Benihana RA Sushi fast-casual restaurant," said Erick Passo, newest Benihana franchisee and owner of Black Market Miami and Ben's Pizza. "The restaurant invites our guests to treat themselves to something special while on the go.  Serving both teppanyaki and sushi, Benihana RA Sushi Brickell will delight guests with a broad array of menu items."

In addition to the Brickell location, Benihana is aiming to open three other locations, including one more in Miami, where the chain is headquartered, later this year. Details on the scheduled openings are as follows:

• Benihana RA Sushi Bayside in Bayside Marketplace, Miami, a fast-casual restaurant, is planned to open mid-year 2024.
• RA Sushi Plantation, Fla. in Plantation Walk is planned to open this summer at 333 North University Drive. The RA Sushi restaurant will be over 3,800 square feet with 34 tables, a full-service sushi bar and dedicated area for take-out and delivery business.
• Benihana San Mateo, Calif. is scheduled to open late 2024 at 2204 Bridgepointe Parkway with 18 teppanyaki tables and a full-service sushi bar.

Founded in New York City in 1964, Benihana operates more than 100 restaurants operating under the brands Benihana, RA Sushi and Samurai brands.

Walgreens Boots Alliance is closing its remaining VillageMD clinics in Florida.

The closings, which were first reported by Business Insider, come as the pharmacy and health care services company has been cutting costs. In October, Walgreens said it planned to close approximately 60 VIllageMD clinics, exiting five markets, as part of those efforts. 

VillageMD had operated 52 clinics in Florida, and 14 have already gone dark. (In late 2021, Walgreens invested $5.2 billion in VillageMD, increasing its ownership stake in the company from 30% to 63%.)

Business Insider, which cited a report by investment firm Jefferies, noted that cited Florida is VillageMD’s third largest market, behind Texas and Arizona. All of the VillageMD clinics in Florida are co-located in Walgreens stores, according to the report.

A VillageMD spokesperson Chain Store Age sister publication Drug Store News, “To continue to scale our care delivery services and value-based care model, we assess and evaluate our progress on an ongoing basis and refine our approach as we grow, similar to most growth-oriented companies. Strategically, we are focused on geographic density in markets and locations where we can serve patients to our standards of quality care." 

The spokesperson continued that in exiting the Florida market,  patients   remain the company’s top priority.

“We are supporting our patients during this transition including giving them resources of where they can receive care, access their medical records and answer their questions,” the spokesperson said.

The activist owner of Pep Boys has named a new CEO.

Icahn Enterprises L.P., which acquired the auto aftermarket service chain in 2016 in a deal valued at $1.03 billion, has named its current chef executive, David Willetts, as CEO of Pep Boys.  Icahn is the investment arm of billionaire activist investor Carl C. Icahn.

“David Willetts has done an admirable job in improving the operational performance of our portfolio companies,” stated Carl Icahn. “We believe David's skill set is particularly suited to work on a day-to-day basis to drive the significant value creation potential in Pep Boys."

At Pep Boys, Willetts replaces Scott Collette, who has served as CEO of the chain since February 2023. Prior to that, Collette spent 32 years at Menards, with his most recent position being COO, from 2007 to 2022. Collette is transitioning to the role of COO at Pep Boys, focusing on driving Greenfield initiatives, acquisitions and evaluation of new service offerings.

In his statement, Icahn defended the activist approach he takes to investing, which he called “the best investment paradigm that exists." 

“The reason activism works so well is that, somewhat unfortunately, many public companies are not well run,” he said. "It is very difficult and expensive to remove a poorly-performing CEO and board. And that is why so few investors today employ true activism.”