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    Carb Wars

    Is low-carb a healthy option for c-store operators? Industry players mull ways to lure new consumers.

    Atkins. South Beach. Protein Power. The Zone. While a majority of Americans still take their burgers with the bun, it can no longer be denied: A significant percentage of the U.S. population is carb-conscious.

    By some estimates, up to 30 percent of Americans are reducing the amount of bread, sugar and other carbohydrates in their diet. From hardcore Atkins fanatics to dabblers who are pushing aside the bread basket before their pasta plates arrive, millions of consumers are thinking twice before making a meal of pizza, soda and a chocolate bar. What this means for convenience store operators, whose typical food bundles include the foods just mentioned —or carbolicious hot dogs and chips — is open to debate.

    "Atkins dieters skew older male, which corresponds a little more closely with the convenience store [than other food channels]," noted Bob Goldin, executive vice president of Chicago-based Technomic Inc., which is studying the country's obesity's crisis and its effect on foodservice operators.

    "I think 'carb phobia' is a fad. But I think 'carb awareness' and 'carb consciousness' is a reality. I don't think the diets are going to have the staying power, but consumers are going to be more conscious of their carb intake."

    A number of fast-food players are betting on that. In the short term, at least, their bets have paid off. Blimpie International Inc. was the first quick-service chain to address the issue head on when it introduced its Carb Counter Menu to the New York tri-state area last October. A speedy coast-to-coast rollout put the menu, which includes four sandwiches, two salads, a dessert and beverage, in 1,600 Blimpie locations by January. Sales of low-carb menu items now account for 10 to 12 percent of all Blimpie items sold — and those sales are all incremental.

    "I really think this trend has legs," said Mark Mears, chief marketing officer for the Atlanta-based chain, who said approximately half of its restaurants

    are in nontraditional locations, primarily in c-stores and g-stores. "While low-carb diets have received a lot of publicity the last few months, they've been around for years. Like all trends, it started with a core group of loyal followers. Then, it built over time to a crescendo, with the funnel widening and more people becoming carb conscious. It is only now beginning in any real sense."

    Unlike Subway Restaurants, who along with TGIFriday's Worldwide, has aligned itself with Atkins Nutritionals Inc., Blimpie's products are marketed under the Blimpie moniker. (Test stores once sold Atkins chips ands peanut butter cups; all stores now sell only Blimpie's own low-carb products.) The Carb-Counter Menu includes sandwiches made with a proprietary 7-Grain Onion Bread (net 7 to 8.5 grams each), two low-carb salads (one featuring buffalo chicken, the other antipasto), a reformulated brownie with 5 net grams of carbs and SoBe Lean no-sugar beverage. Coming up: a low-carb strawberry cheesecake and other items.

    "Our customers were telling us they wanted low-carb products," Mears said, "and we felt we could come up with a formulation that would not sacrifice taste. The 7-Grain Onion Bread is good by itself, grilled on our panini grill, it tastes fantastic. We've prided ourselves on product innovation for our 40 years and this seemed like a logical step in our evolution from 'neighborhood sub shop' to a contemporary deli."

    Mears calls other fast-food low-carb strategies, such as serving hamburgers without the bun, "desperate attempts to try to capture the trend. They are doing what they can physically do. But we took the opposite tack. We didn't come out with just one product, we came out with a full menu. And the sandwiches have been so well received, it's making us re-think our whole menu."

    The chain now offers the new-sandwich ingredients — such as roast beef, cheddar and Wasabi sauce — on regular sub rolls and its regular sandwich ingredients on the signature low-carb bread. Promotional items, such as the Blimpie Cuban Sandwich, also can be ordered on the 7-Grain Onion Bread.

    The Carb Counter Menu items typically carry higher retails, as franchisees pass on the higher cost of the new sandwiches' ingredients. Regular sandwiches served on the low-carb bread will get a small price bump.

    "We are providing options and revamping the entire menu to be more inclusive," Mears explained. "We're not going to make health claims, but Blimpie can be a part of a healthy, active lifestyle. If you are a vegetarian, we have our Veggie Max products. We have other options for those counting fat. We don't want to limit the number of customers who can take advantage of Blimpie's unique taste."

    C-store operators with their own foodservice programs could learn from this strategy, Goldin said. "Convenience stores stand for super sizes, two hot dogs for 99 cents, belly-filling, unhealthy. Rather than jumping on the low-carb bandwagon and reinventing themselves for what may be a short-lived trend, c-store operators should improve the core offering to offer healthier options. Seven percent of Americans are on Atkins-like diets. That's a big number, but there are 65 percent of the population overweight, which means 58 percent are not on a diet or are on some other diet."

    Fast feeders who come out with knee-jerk low-carb initiatives will find them short-lived, Goldin predicted. "Burger King's bun-less sandwich (served in plastic) — you can't eat it."

    Still, CKE Restaurants Inc.'s Carl's Jr. and Hardee's chains have gotten a great deal of media coverage for their bun-less, lettuce-wrapped burgers, which rolled out in December. "We observed a lot of customers ordering our burgers, removing the buns and trying to eat them with a knife and fork," said Brad Haley, executive vice president, marketing, for both chains. "We also had employees on low-carb diets suggesting our burgers would make the best low-carb option, because our burgers are bigger — Hardee's has a one-third-pound patty and Carl's has a half-pound patty. Plus, they are seasoned and taste good and will fill you up without the bun."

    Though CKE considered low-carb bun options, Haley said executives didn't like their taste. Since the chains were already using whole iceberg lettuce leaves on their burgers and presenting the burgers in a cardboard carton, half wrapped in paper, operationally the addition of the bun-less burgers was not difficult.

    Sales, he said, have exceeded expectations. "Timing was important and these burgers have become one of the best selling burgers at Carl's Jr. and Hardee's."

    In March, McDonald's Corp. began standardizing its burger-without-a-bun strategy, offering any core menu sandwich (excluding breakfast items) in a side salad bowl. The consistent presentation was expected to be chainwide by late May. Carb-counting customers will now get their bun-less Quarter-Pounders served on whole-leaf lettuce in a side salad bowl, with a knife and fork.

    "A lot of customers are doing this already, so we're presenting it in a consistent way for our customers," said Bill Whitman, a spokesperson for the chain, who noted the option would not be promoted heavily. "In some restaurants, customers may have gotten a burger in a traditional container without bread, other stores may have wrapped it."

    While these fast feeders are targeting carb counters, c-store operators should avoid narrowly focused menu additions, Goldin advised, even as the convenience channel takes up the challenge of addressing the country's obesity problem.

    "Some of these truck drivers and blue-collar workers coming in will, at some point, wake up and realize they have to do something about their weight," he said. Instead of loading up on four chili dogs, maybe they should buy turkey dogs or vegetarian chili. Maybe offer prepackaged baby carrots instead of chips. Offering salads, fresh fruit, yogurt — that's absolutely appropriate. [The convenience channel] needs to give people options." (See "Sheetz, 7-Eleven Satisfy Carb-Counting Customers," Page 76.)

    Low-Carb Choices

    Giving customers options led Subway to introduce two Atkins-Friendly Wraps, Turkey and Bacon Melt Wrap and Chicken Bacon Ranch Wrap, which have far exceeded the company's expectations — selling five times expected sales — since their late-December debut.

    By co-branding the wraps with the Atkins name, Subway was able to cut through the low-carb promotional clutter, said Les Winograd, a spokesperson for the Milford, Conn.-based fast-food chain, which recently opented its 4,000th nontraditional location. "We're telling people who are following an Atkins style of diet there is food they can eat in our restaurants. That 'A' on our menu is like a beacon going out, like the Bat signal."

    Such alliances bring foodservice operators a great deal of free press, Goldin noted. "It's $50 million free publicity the minute you announce a partnership. But, you pay pretty hefty licensing fees and they automatically paint you into a corner. Many people think the Atkins diet is dumb. [The brand] can be polarizing."

    Still, Subway did not go into the alliance without data to back up the decision. Thirty-five percent of the respondents participating in the company's research said they followed some diet. Of those people, 34 percent said they were following a low-carb diet. "That told us people were being underserved," Winograd said, adding the wraps are slightly more expensive than the subs, but franchisees set their own prices.

    At the end of April, Subway introduced four new salads. Two of them, the Classic Club with Ranch and the Grilled Chicken & Baby Spinach with Atkins Sweet as Honey Mustard, have the Atkins-friendly endorsement. Also, customers can have any sandwich on the menu prepared as a salad. Also, any Subway sandwich may be prepared as a wrap.

    As for plans to expand the low-carb menu even further, Subway "has some things coming down the road," Winograd offered. But don't expect a huge line of low-carb side dishes from the sandwich maker. "Our efforts have been to focus on sandwiches and salads. If R&D comes up with something that customers like, it's possible."

    For now, the Atkins-Friendly Wraps are featured with their own panel on Subway's new menu boards. But operationally the new product introduction took a bit of training on the front line, where "sandwich artists" must follow the formula to the letter to ensure the carb count. "Plus," Winograd noted, "if someone wants an Atkins sandwich, you don't want to up-sell them a cookie."

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