We are hosting our monthly Restaurants & Consumer Staples Q&A call today at 10 AM ET.
Email your questions ahead of the call to
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CLICK HERE at the time of the event for the live webcast and materials. |
Breakfast is the best daypart (RVAC)
The breakfast daypart was the most negatively impacted by the pandemic with office workers’ slow return to the office. According to NPD the breakfast daypart had flat traffic in Q2, benefiting from easier comparisons, while the rest of the day saw declines. Revenue Management Systems also reported similar trends with breakfast traffic returning to positive in May. Starbucks said breakfast is coming back with velocity. Management said on the last conference call, “We’re optimistic those morning routines are coming back.” McDonald’s said that breakfast was the strongest daypart in the U.S. comp store sales of 3.7%. Weekly breakfast sales at Wendy’s reached $2,500 per store, exceeding the $2,000 a week breakeven point during Q2. Westrock Coffee is the largest store label coffee and tea provider to U.S. restaurants. It supplies over half the largest QSRs with coffee. Westrock Coffee’s shareholder vote is scheduled for August 25. Once approved the de-SPAC will likely take place about one week later.
Grocery Outlet partners with DoorDash (GO)
Grocery Outlet announced a partnership with DoorDash to offer on-demand delivery from nearly 400 locations. Grocery Outlet is typically priced 40-70% below grocery store prices. The standard order fee is $3.99, but DashPass members receive unlimited free deliveries for orders at Grocery Outlet above $35. While someone paying $9.99 per month for DashPass does not seem to match the profile of a value grocery shopper, there should be some overlap. According to Numerator, a data firm, only 31% of grocery shoppers have tried grocery delivery from DoorDash or its competitors Uber Eats and Grubhub. 21% of consumers have used grocery delivery from the food delivery companies and only 5% are loyal grocery customers of the delivery platforms.
The recovery in wine (VWE, NAPA)
The Wine & Spirits Wholesalers of America reported a slowdown in the on-premise channel for wine and spirits in the most recent three months ended June 22. Spirits had fully recovered to pre-pandemic levels in the on-premise channel in the three months ended May 22 before slowing by 3% points in the next month. Wine had recovered to 3% points below pre-pandemic levels in the three months ended May 22, but also slowed by 3% points in the most recent month as seen in the chart below. Volume for wine and spirits continued to grow +5.3% for wine and +9.5% for spirits. The recreation channel has recovered above pre-COVID levels for spirits while the transportation channel was still below. The on-premise channel is still the strongest channel for wine, despite the sequential slow down.
