Restaurant Business Quarterly | Q2 2026

APRIL 2026

Christine Barone Was Made for this Moment P. 26

Restaurants Take Their Case to Congress P. 10 | Cheese is Melting All Over Menus P. 32

JONATHAN MAZE EDITOR-IN-CHIEF

WELCOME EDITOR’S

JONATHAN.MAZE@INFORMA.COM @JONATHANMAZE

I am an old print veteran who loves newspapers and magazines and hates to see them go away in favor of the online version. Yet businesses have to evolve.

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CONTENTS APRIL 2026

MARKETING FOR RESTAURANTS ‘FAKE NEWS’ IS BECOMING A REAL PROBLEM.............................................18 EMERGING BRANDS RICE MEDITERRANEAN KITCHEN BRINGS PERSIAN FLAVORS TO THE TABLE..................22 COVER STORY CHRISTINE BARONE WAS MADE FOR THIS MOMENT.........................................................26 FOOD AS CULVER’S EXPANDS INTO NEW MARKETS, MENU INNOVATION ACCELERATES..................................................30

FINANCE INSIDE OMER GAJIAL’S PLANS FOR AUNTIE ANNE’S OWNER GOTO FOODS.........................4

CHEESE IS MELTING ALL OVER MENUS, GIVING SALES A SOLID BOOST....................................32

INSIDE THE CULTURE AND CULINARY INNOVATION BEHIND FIRST WATCH’S GROWTH..........................................................34 TECHNOLOGY WHY THIS POS COMPANY BELIEVES IT CAN DOMINATE THE MARKET FOR ASIAN RESTAURANTS.................................................38

A LOT OF FAST-FOOD CUSTOMERS ARE GOING TO THE CONVENIENCE STORE INSTEAD..........6

LUCKIN COFFEE MAKES A PLAY FOR THE PREMIUM MARKET............................................8 OPERATIONS RESTAURANTS TAKE THEIR CASE TO CONGRESS AS MIDTERM ELECTIONS LOOM.....................10 AT THIS SOUTHERN CALIFORNIA CAR DEALERSHIP, YOU CAN GET A PATTY MELT WITH YOUR PORSCHE........................................14

TRAVIS KALANICK’S PLAN TO RESHAPE RESTAURANTS ISN’T ADDING UP...................40

Photo: Jonathan Maze Cover Photo: Jon Mouer

APRIL 2026 RESTAURANT BUSINESS

FINANCE

INSIDE OMER GAJIAL’S PLANS FOR AUNTIE ANNE’S OWNER GOTO FOODS The new CEO of the fast-food chain operator wants to build unit economics, improve the customer experience and build on its technology capabilities.

THE GOTO FOODS CONFERENCE STARTED WITH A BRAND INTR WITH FLAG-WAVING. | PHOTOS BY JONATHAN MAZE.

B efore he took the helm of GoTo Foods in December, Omer Gajial worked in the supermarket industry, with the chain Albertsons, the CPG company Pepsi- Co and the tech company Amazon. Yet as he got on stage at the fast-food chain operator’s an- nual franchise conference in Atlanta in February, Gajial talked more like a science teacher. “I’m talking about improving our chemistry with our guests and also improving the physics of our business,” he said in front of a crowd of franchisees of GoTo Foods brands, including McAlister’s Deli, Auntie Anne’s, Cinnabon, Moe’s Southwest Grill, Carvel and Jamba. To Gajial, the “chemistry” is the customer experience and the “physics” is the unit economics. They, along with technol- ogy, are part of Gajial’s three-part plan for the company he now leads. The changes will be crucial for GoTo Foods to reach its long-stated goal. The company has gone through a number of changes in recent years, not the least of which was the hiring of Gajial as well as a corporate rebranding and new hires. The conference came two years after the former Focus Brands announced its new corporate moniker. The company, put together from the first acquisitions of the private-equity firm Roark Capital, in February announced a new CFO in Brett Ubl and a new chief growth officer in Francisco Bram. Three other executives, meanwhile, were given expand- ed role, including Mike Freeman, EVP and president of the brands, Urvi Patel, SVP of brands and chief brand officer of Cinnabon, and Chris McNutt, chief supply chain officer. Globally, the company’s brands have 7,300 stores in more than 70 countries and GoTo Foods last year reached deals to open another 1,400. But from a sales standpoint many of the chains have stag- nated, at least in the U.S. All but one of the chains, the pretzel concept Auntie Anne’s, reported negative U.S. system sales in 2024, according to data from Restaurant Business sister com- pany Technomic. Jim Holthouser, who had led the company for six years, announced his retirement. Gajial met with more than 80 franchisees and visited more than 50 locations in the more than two months since his ar- rival and spoke with a number of customers. He also said that he paid close attention to the team, the technology and the

JONATHAN MAZE

JONATHAN.MAZE@INFORMA.COM

RESTAURANT BUSINESS APRIL 2026

RODUCTION, COMPLETE

company’s various brands. “I’ve learned a bunch,” he said in an inter- view. “It’s been a great experience to learn the business, but also to understand what’s work- ing, what’s not working, and the opportunity ahead of us to delight our customers and cre- ate meaningful value for our franchisees.” He called that opportunity “abundantly clear.” In his presentation to franchisees, Gajial vowed to “delight our customers, grow traf- fic and improve unit level economics and also win in the marketplace.” Gajial called unit economics GoTo Foods’ top priority, which is crucial for a compa- ny that relies on franchisees to run its res- taurants. He cited a new prototype from Schlotzsky’s Deli, which lowers the cost to build and operate by 15% to 20%. He also cit- ed a Jamba prototype that cuts the build-out costs by 20% to 25%. Unit economics is important for any fran- chise because if stores don’t generate a return on investment then existing or prospective franchisees don’t open new locations. “We take your investment in this business very seriously,” Gajial told franchisees. But unit economics are made up of both cost and revenues, and GoTo Foods needs to generate more revenue. Each of the brands is focused on building more sales through a va- riety of channels, notably catering. Inside the conference’s exhibit hall, each of the chains had their own booths, where they demonstrated upcoming menu items and other new ideas. And all of them showed off some kind of catering operation—or ca- tering-adjacent operation, in the case of the cakes at Carvel. There were acai bowls and large boxes to transport juices at Jamba and a build-your-own baked potato bar at McAl-

ister’s Deli. Gajial said that the brands need to do a better job of marketing the benefits of some of its products. For instance, a product may have a good amount of protein but the com- pany doesn’t call it out. “I think we at times have the right product, but the way we frame it and we present it to the customer, we leave a little bit for the customer to translate the benefits of that product,” he said. “While the benefits are there, we don’t call them out.” Technology can also help build unit eco- nomics, both by making the operations of the restaurant more efficient while providing op - portunities through loyalty programs to build sales. Gajial told franchisees that the company has a “solid foundation” on technology but ac- knowledged there is “more work to do” to get where GoTo Foods wants to be. “We’ve invested a lot in building technol- ogy, but putting the pieces together in service of the customer and putting the pieces togeth- er in service of the franchisee is the last leg where technology can truly be a multiplier,”

Gajial said in an interview. And then there is the customer experi- ence. GoTo Foods is working on prototypes at its brands designed to improve that expe- rience, such as at Auntie Anne’s, where the company is more eagerly displaying its pret- zel-making. Its loyalty programs added more than 4 million members last year. Yet translating that customer experience to the stores is a challenge in a franchise be- cause it’s up to franchisees to get the job done. When asked about that, Gajial said the com- pany relies on its franchisee advisory councils (FACs) to help with those efforts. And during the conference he acknowledged the mem- bers of those councils from the stage. “We have a very engaged, deeply con- nected, deeply invested franchisee councils for each brand,” Gajial said, noting that there are large and small franchisees who sit on the councils. “We have huge diversity in terms of who represents the FAC, and we leverage the FACs to design new solutions, new products or a new approach toward brand engagement with our customers.”

FINANCE

PHOTO COURTESY OF 7-ELEVEN

A LOT OF FAST- FOOD CUSTOMERS ARE GOING TO THE CONVENIENCE STORE INSTEAD The Bottom Line: The lines between a quick-service restaurant and a convenience store are increasingly blurring, and they’re playing a role in the industry’s weak traffic, according to Technomic.

BY JONATHAN MAZE F ast-food restaurants have faced a lot of challenges over the past couple of years. Consumers have been battered by inflation. They’re frustrated by higher prices and are making that known on social media. There’s weather. In many markets Hispanic consumers are under pressure. More Americans are using GLP-1 drugs for weight loss. And those kids keep changing the way they use restaurants. Add another problem to the list: Convenience stores are taking a discernable share of traffic. That, at least, is according to a study by Restaurant Business sister company Technomic . In the third quarter, 15% of customers who visited a convenience store would have considered going to a fast-food restaurant. The biggest problem came during lunch, when 39% of such customers opted for a convenience store. Unsurprisingly, the chain that lost the most business to convenience stores was McDonald’s, where 38% of c-store customers who said they’d considered a fast-food restaurant would have gone. But Burger King, Taco Bell, Wendy’s, Chick-fil-A and Subway were all mentioned. To be sure, anybody with two eyes has known about the growing competitiveness between convenience stores and fast-food restaurants. This has been happening for years. C-stores have moved increasingly to prepared food as a way to blunt the loss of

FAST-FOOD CHAINS LOSING THE MOST CUSTOMERS TO C-STORES These are the chains that customers say they’d go to if they didn’t visit a convenience store for a meal or a snack, according to Technomic.

business from sales of cigarettes and as a way to convince more gas customers to get out of their cars and go into the stores. It’s working, too. Customers’ views of convenience stores are improving. Another Technomic report in January found that 45% of convenience-store foodservice customers rated their experience as “excellent” on a recent visit, up from 41% two years ago. Convenience stores have improved their food items, making them a legitimate draw for hungry consumers, such as chicken at the Midwestern chain Kwik Trip or specialty sandwiches at Wawa. 7-Eleven has developed its own restaurant chain, Laredo Taco Company, and marketed wings and pizza for March Madness. Casey’s is one of the biggest pizza chains in the U.S. Some are even getting into the drive-thru coffee business, such as the convenience-store chain Town Pump, which is creating a brand

called Stonehouse Coffee Shots, according to our sister publication CSP Daily News. And many have meal deals that look an awful lot like what you’d see at Taco Bell or Wendy’s, such as the $3, $4 and $6 meals you can get at Circle K. Convenience stores also have an advantage over much of the business in that they’re frequently built for in-and-out traffic, which can make them desirable destinations for on-the-go customers. And they have the added benefit of other items, including a robust selection of beverages, not to mention things like ATMs, lottery tickets, snacks and, of course, transmission fluid. For restaurant chains, the answer to all this is relatively simple: Make sure that what you’re offering is worth going to. Because there’s probably a really good competitor right down the street.

RESTAURANT BUSINESS APRIL 2026

FINANCE

LUCKIN COFFEE MAKES A PLAY FOR THE PREMIUM MARKET The Bottom Line: The fast-growing Chinese chain, known for its low prices, is reportedly acquiring the higher-end brand Blue Bottle Coffee from Nestle for $400 million.

visit a brand like Blue Bottle because you really like coffee. Luckin would not do such a deal simply to spend $400 million to buy several dozen locations, not when it opens about that many units every day. And it’s not as if Blue Bottle gives the company that much of a foothold in the U.S. market—the chain operated just 74 domestic locations at the end of 2024, according to data from Technomic. It was the country’s 16th largest coffee chain that year, and grew sales at just 6%. What the deal does do is give Luckin a more premium brand and access to that knowledge. That is important not just in the U.S. but in China, where the coffee consumer is rapidly growing more sophisticated. And it’s clear that Luckin executives are focused on more than just price right now. “Since Luckin’s inception, both China’s coffee industry and consumer behavior have transformed rapidly,” Jinyi Guo, Luckin’s CEO, told analysts last month, according to a transcript on the financial services site AlphaSense. “Freshly-brewed coffee brands can no longer rely solely on pricing, individual hit products or single marketing campaigns to achieve lasting success. “Instead, this long-term competitiveness increasingly depends on an integrated set of capabilities. For example, brand perception, customer experience, emotional connection, product development capabilities and store coverage.” Luckin, which was founded in 2017, has been one of the most amazing growth stories the restaurant industry has seen. Within a couple of years it had more locations in China than Starbucks. It then ended up in

bankruptcy, while some top executives went to jail, after fabricating customer counts. Its new owners righted the ship coming out of bankruptcy and proceeded to start growing again. Five years later it has more than 30,000 locations and has established a beachhead in the far-more sophisticated U.S. market, where it now has nine shops. Guo told investors that the company is in the early stages in the U.S. and has a “disciplined expansion strategy” currently focused on refining the company’s infrastructure and exploring different operating models. The chain has deployed a tech-heavy and price-efficient approach. Revenues last year rose 43%. More than 94 million customers visit the chain’s shops every month, up 31%. Store-level profit margins did take a hit, declining 120 basis points to 17.8%. Yet the company generated $514 million in net income last year. That success put Starbucks, in particular, on its heels. The Seattle-based coffee giant staked a claim to the more premium market in China, and the company has had some success more recently, including a transaction-led 7% growth in same-store sales last quarter. Details of Luckin’s purchase of Blue Bottle remain sketchy at best but reports indicate the brand will be operated separately, at least for now. Yet the deal would combine Blue Bottle’s premium know-how with Luckin’s tech-heavy approach and aggressive expansion strategy. That, alone, would make an already competitive market for coffee that much more difficult, both in China and, potentially, the U.S.

JONATHAN MAZE

JONATHAN.MAZE@INFORMA.COM

L uckin Coffee is making a play for the premium market. Centurium Capital, the controlling shareholder of the fast-growing Chinese chain, is reportedly acquiring, or close to acquiring, Blue Bottle Coffee from Nestle for $400 million. Bloomberg said this week that the talks were “advanced,” while Nikkei Asia reported on Thursday that the two sides had reached a deal. Either way, the deal is notable. Luckin Coffee is known for its low prices. Blue Bottle Coffee is not known for its low prices. Started in San Francisco and now with more than 100 locations, mostly in the U.S. and China, Blue Bottle is one of the “third wave” of premium coffee concepts that promise higher-end specialty coffee. You

RESTAURANT BUSINESS APRIL 2026

OPERATIONS

RESTAURANTS TAKE THEIR CASE TO CONGRESS AS MIDTERM ELECTIONS LOOM The National Restaurant Association is striking a confident tone on pressing issues like swipe fee relief, immigration and tariffs. One reason: Most people love the businesses it represents.

T his can’t be an easy time to lobby Con- gress. Divisions between the parties seem to make compromise impossible. The U.S. has started bombing Iran, and the president has threatened to veto all legisla- tion until a bill on voting identification, or the SAVE America Act, passes. Oh, and there’s a midterm election coming up. And yet Michelle Korsmo, the CEO of the National Restaurant Association, and the group’s EVP of public affairs Sean Kennedy, both seemed confident as they sent nearly 500 restaurant operators and state association di- rectors to meetings at the Capitol last week. That’s not to say that the association expects everything to go its way. The group’s three main legislative priorities this year include credit card swipe fee reform, immigration reform and the United States-Mexico-Canada Agreement, the treaty formerly known as NAFTA. The association is going up against the well-financed financial services industry when it comes to swipe fees. Immigration hasn’t been reformed in four decades for a reason. And the trade talk runs up right against President Trump’s signature policy strategies, tariffs. Yet the association believes it has an ad- vantage that crosses party lines that almost no other industry has: People love what they represent. Just about everybody has a favorite restaurant. And when members of Congress meet with operators or other representatives they always ask how the local restaurants are performing. And so when Korsmo and Kennedy sent those operators out to those meetings, their pri- mary instruction was simple. “We always start with the fact that nine out of 10 Americans love restaurants, so that’s a win,” Korsmo said in an interview. “Every mem- ber of Congress understands how important restaurants are to strong, healthy, happy com- munities. They understand the great scale of the restaurant industry in terms a small entrepre- neur that has created something that means a lot to their neighborhood.” That is not the only number that the group touts. The association says that 42% of restau- rants are losing money, a function of the num- ber of small-scale operators in the industry. The median pre-tax income at restaurants is just 3%

JONATHAN MAZE

JONATHAN.MAZE@INFORMA.COM

RESTAURANT BUSINESS APRIL 2026

RESTAURANTS HAVE THREE MAIN POLITICAL PRIORITIES THIS YEAR: SWIPE FEES, IMMIGRATION AND TRADE. | PHOTO: DIMITRI MORSON

of revenues. Because so many restaurants operate on the edge, it means simple challenges can wipe out their profits and drive them out of business. But these numbers are difficult for members of Congress to ignore, especially given the new and growing costs many res- taurants must pay simply to do business. “We have credit card fees and third-par- ty delivery fees and [increasing] prices from all our vendors,” Mike Axiotis, chairman of the association’s board and CEO of the Red Robin and Wingstop franchisee Lehigh Val- ley Restaurant Brands. “Rent has gone up. Taxes have gone up. To only make 2.8% prof- it margin doing the amount of work we do is The profitability issue is most at play when it comes to swipe fees. That’s also the issue on which the association is most confident. “I feel better about swipe fees every week than I did the week before,” Kennedy said. Swipe fees have quietly become a major expense for a lot of restaurants, typically competing with rent to be the third-biggest cost for restaurants. As many as nine out of 10 transactions are done with a card, mean- ing there’s a fee attached. The interchange fee averages about very, very difficult.” SWIPE FEES

2% in the U.S., where such fees are widely considered to be the most expensive in the world. In the European Union, for instance, such fees are capped at 0.2% for debit cards and 0.3% for credit cards. For an industry that generates such low profits on average, such fees stick out. “In my 13 years, that swipe fee has gone from a nickel to 15 cents,” Steven O’Neil, managing partner at The Manship Wood Fired Kitchen in Jackson, Mississippi, said at the conference. “That’s a 300% increase in just over a decade that I’ve been a manager and an operator.” To banks, however, such fees are impor- tant because they help fund the payment infrastructure and its security. They argue that cards increase frequency and ticket size and make the checkout process faster. The Electronic Payments Coalition (EPC) argues that credit card reward programs would dis- appear if the fees were capped, for instance. Consumers tend to like such rewards. Restaurants, nevertheless, believe they have an upper hand on that issue this year for multiple reasons. First: Affordability is a crucial issue heading into a midterm election, and anything that can be seen as addressing that issue has a chance. Second, legislators in Delaware recently advanced bills to curtail such fees.

Third, and most important: President Trump in January backed a U.S. Senate bill to introduce more competition in the cred- it card processing industry, known as the Credit Card Competition Act. Trump said the bill would end “out-of-control swipe fee rip- offs.” “I’m not buying champagne,” Kennedy said. “I’m certainly not chilling any. But we are definitely looking at a point where every elected [official] is going to say this is an un - tenable situation. We probably do need to figure out a solution. They can’t keep sweep - ing this under the carpet, which is what they’ve been doing for years.” IMMIGRATION Another issue, immigration, is a lot less cer- tain. Reform has been a political hot potato for four decades, undone by political dis- putes, concerns about border security and more pressing issues. The last time a major immigration bill passed was 1986. Yet it’s a crucial one for restaurants. More than one out of five restaurant work - ers was born outside the U.S., a similar per- centage to employers like meat packers or agriculture that help make up the industry’s supply chain. That means the issue could the- oretically impact both labor availability and the cost of goods.

APRIL 2026 RESTAURANT BUSINESS

RESTAURANT PROFITABILITY TAKES A HIT Median pre-tax income has fallen for both full-service and limited-service restaurants, according to the National Restaurant Association. That lack of profitability is a major talking point for the group.

While the restaurant labor market has improved in recent years, more than one in five restaurants still say they’re under - staffed, according to the association. The group wants to push Congress to pass immigration reform to protect the workforce that is here and provide a path to citizenship for those people who came to the U.S. when they were young and remain productive, law-abiding citizens. Several people who work with Westover Taco in Arlington, Virginia, are on temporary protected status. “Several of our workers are definitely relying on that,” Sarah White, the restaurant’s owner, said at the conference. “We have three or four people on the same status. What would happen to our restau- rant if we lose that every night?” So why would this year be any different than the last 40? “My radical theory is that immigration has the highest chance of working under Donald Trump,” Kennedy said. “If he’s going to bring the MAGA base and the traditional Republican base together, only he can drive it. And he’s got two years and nine months

to achieve it. I think it can be done, but the stars have to be in alignment.” One reason Trump could shift that atten- tion? The border is secure. “We have a se- cure border, so if you look at it from an une- motional perspective, now would be a great time to make these things happen,” Korsmo said. TRADE AND TARIFFS Another potential concern is the U.S.-Mexi- co Canada Agreement, or USMCA, the trade deal formerly known as NAFTA. That agree- ment is undergoing a joint review set for July 1 of this year. The politics and chances of that agree- ment have changed under Trump, who has made tariffs a focal point of his policy. The association wants to preserve food-and-bev- erage tariff exemptions. “The president doesn’t want anybody to feel confident about tariffs, because he’s go - ing into a negotiation,” Korsmo said. The association estimates that the 25% tariff Trump issued last year added $12 bil- lion in total food costs to consumers. The

Supreme Court ruled those tariffs illegal, but the president immediately responded by applying a 10% tariff on nearly all countries under a different law that is set to expire af- ter 150 days. Korsmo noted that the association has succeeded at getting exemptions for food and beverage in the past, and affordability remains a crucial issue. “We need to keep making that message, because the president wants this to be an uncertain situation,” Korsmo said. Still, Congress is divided. And this is a midterm election season. Why would Con- gress be willing to do much of anything over the next few months when they have voters to answer to come November? Then again, why not? Congress wants to tell the voters they did something. That has fueled plenty of big legislation during mid- term election years. The Homeland Securi- ty Act was passed in 2002, as was the Sar- banes-Oxley Act. The Affordable Care Act was passed in 2010. “It’s one of the bigger misconceptions that nothing happens in mid- term election years,” Kennedy said.

RESTAURANT BUSINESS APRIL 2026

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OPERATIONS

AT THIS SOUTHERN CALIFORNIA CAR DEALERSHIP, YOU CAN GET A PATTY MELT WITH YOUR PORSCHE

A car dealer is building a $5 million restaurant empire in its showrooms. Guests love the quirky aspect of finding a “hidden gem” where they least expect it.

S itting in the Horseless Carriage diner in the Los Angeles area, one wouldn’t have the impression the restaurant industry is struggling. Tables were packed on a Friday lunch, with guests waiting at the door. A steady pace of takeout customers picked up bags at the register. A couple of cheerful servers bounced around the room, bantering with what appeared to be many regulars, while delivering dishes heavy with steak and eggs, chicken and waffles, patty melts and baked- in-house pies. What made the scene so unusual, howev- er, was the fact that the 140-seat diner is in a car dealership. Just feet away from the 1960s-era coun- ter and booths of the Horseless Carriage, shiny new Fords were on display. Across the street, it was Land Rovers and Aston Mar- tins. Down the road, Volvos, Lincolns and Volkswagens. In fact, the Horseless Carriage is just one concept in a growing restaurant group oper- ated by Galpin Motors, a family-owned oper- ation that dates back to 1946, when it began selling Fords. Now the sprawling dealership with outlets across the greater LA area sells about 13 brands, from Honda to Polestar. And at those dealerships, Galpin operates restaurants, bars and coffeeshops, from the

signature Horseless Carriage diner to a Ger- man (inspired) concept called Boxenstopp (in the Porsche dealership), where guests might sit down to a Bratwurst omelet, schnitzel or a Boxster Burger with truffle fries. Leading the restaurant operation is Exec- utive Chef and Food-and-Beverage Director Geovanni Euceda, who spent seven years with the Beverly Hills Hotel before joining Galpin in 2002. That may seem like an odd move. But the Boeckmann family behind the Galpin em- pire is investing in the restaurant side of the business. Next up is a sushi concept Euceda is planning for a new Mazda dealership un- der construction (“It’s a Japanese brand,” he noted). For a massive car dealership like Galpin, it makes sense, argued Euceda. The late owner Bert Boeckmann, who died in 2023 at age 92, wanted to create a full-service experience, one that would keep people on the property if they got hungry while car shopping or waiting for service. “It’s a complement to anybody who comes to purchase a car, while they’re wait- ing to sign the paperwork, to enjoy a meal with us,” Euceda said. “We pride ourselves on putting really gourmet food out there.” While most car dealerships might of- fer snacks like stale popcorn or chips from

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LISA.JENNINGS.US@INFORMA.COM

RESTAURANT BUSINESS APRIL 2026

THE HORSELESS CARRIAGE SITS AMID A FORD DEALERSHIP IN THE LOS ANGELES SAN FERNANDO VALLEY. | PHOTO BY LISA JENNINGS

a bank of vending machines, Galpin buyers and service customers can sit down to a draft kombucha, a cappuccino with freshly baked biscotti at Fika in the Volvo dealership (“fika” means coffeebreak in Swedish) or—for the elite buyer—even a high-end Japanese whis- ky in a James Bond-like showroom staged like a bank vault with the latest Aston Mar- tin glittering on a pedestal. Galpin also licenses a Starbucks outlet and a Coffee Bean & Tea Leaf in some of its buildings. “Everything has a little touch of food and beverage,” said Euceda. In addition, Euceda’s food-and-beverage team juggles the catering of various events, from the launch of new cars or the dealer- ship’s annual car show, to F1 race viewing parties. Once a month, Galpin hosts a Cars and Coffee gathering for car lovers and their vehicles that typically attracts up to 4,000 people. It’s big business. Euceda said the Horse- less Carriage alone does about $3.2 million in sales annually. Overall, food-and-beverage sales bring in more than $5 million for Gal- pin. And Galpin is not alone in seeing an op- portunity with foodservice. In nearby Ventura County, a Bunnin Chevrolet dealership reportedly hosts the

barbecue concept R+Q Kitchen. In Charlotte, North Carolina, a Town and Country Ford dealership has created a brick-and-mortar home to a favorite food truck concept. In Sarasota, Florida, another Ford dealership boasts the Le Mans Kitchen restaurant, though it’s for customers only and not the general public. A Sacramento Mercedes- Benz dealership is known for its pizza. The car-themed Ford’s Garage, a full-ser- vice chain based in Tampa, is also growing quietly. Founded near car pioneer Henry Ford’s winter home, the concept has no affil - iation with the Ford Motor Co. But the auto- maker got curious about the brand and later signed a licensing deal with the chain. Now a Ford’s Garage operates across the street from the car brand’s world headquarters in Dearborn, Michigan, and dealers are looking to bring the brand into their facilities. At Galpin, one of the largest car dealer- ships in Southern California, some of the res- taurant outlets are tucked into showrooms with no real street presence. Others, like the Horseless Carriage, operate as independent restaurants. Guests come and go from a sep- arate entrance, without having to navigate hovering sales reps. But Euceda is clearly well integrated into dealership operations. Walking through the various properties with him, he is greeted

warmly by staff, with sales reps thanking him for taking care of buyers to help clinch deals. On social media, the Horseless Carriage is touted as a local gem for those in the know. It’s largely a breakfast and lunch concept. The restaurant closes at 8 p.m., but offers early bird prime rib specials, starting at 4 p.m. and the menu (rather comically) offers dishes like surf-and-turf, with a whole lob- ster-topped steak. “I run out of it all the time,” said Euceda. “People love it.” On the second floor of the Ford dealer - ship is a bakery operation, where pies and cakes are produced daily. Euceda said he’s talking with a local coffee roaster about cre- ating a Galpin brand of coffee to further ex- tend the brand. On Yelp, the Horseless Carriage has a 4.5- star review average, with many commenting on the “hometown vibe” or noting that their meal was comped as they waited for their car to be serviced. “The food is much better than you’d ex- pect,” said one recent review in The Infatua- tion . “Slide into one of the aqua-colored bar seats, order scrambled eggs with chunks of sweet lobster, and let the guy next to you ex- plain how they don’t make engines like they used to.”

APRIL 2026 RESTAURANT BUSINESS

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The rise of AI and social media is allowing misinfor- mation to flourish, and forcing restaurants to be more vigilant in snuffing it out. FOR RESTAURANTS ‘FAKE NEWS’ IS BECOMING A REAL PROBLEM

O n Saturday, Feb. 7, a popular X account called Wall Street Apes posted that the CEO of Chipotle had been “caught on a recording” saying that the chain was going to raise pric- es because many of its customers come from higher-income households. The post was reshared 12,000 times, sparking an outcry on social media and draw- ing negative headlines from outlets like Fox News and the New York Post. There was just one problem: It wasn’t true. The post blatantly misconstrued Chipot- le CEO Scott Boatwright’s actual comments, which were captured not on a leaked record- ing, but on a public earnings call with financial analysts held earlier that week. Boatwright did say on the call that many of Chipotle’s core customers come from households earning $100,000 or more, and that the chain wanted to focus more on that group as it looks to drive traffic this year. However, he said nothing about raising prices, on those customers or anyone else. In fact, CFO Adam Rymer said on the same call that Chipotle plans to keep price hikes below inflation in 2026. Still, the idea that the chain was secretly planning to gouge loyal customers made for good social media fodder and juicy headlines. It spread quickly over the weekend, and

by Monday, the situation was firmly on the radar of Chipotle’s social listening team, a group of half a dozen staffers who monitor social media from 7 a.m. to midnight, tracking chatter about the burrito chain, be it positive or negative. “In this case, it was clearly blatantly wrong,” said Laurie Schalow, Chipotle’s chief corporate affairs and food safety officer. “And we’re very sensitive to the pricing conversa- tion and value for consumers these days. So that’s why we felt very quickly on this one that we needed to respond.” That day, Boatwright set the record straight in a previously scheduled interview with Yahoo Finance. Schalow issued a sepa- rate statement to the press, and the chain’s social team worked to respond to inaccurate posts and comments that were gaining trac- tion on social media. Chipotle didn’t see a direct impact on its business from the episode, Schalow said, but it posed a threat to the brand’s reputation. “It was something we wanted to correct because it was not right,” she said. It was just the latest example of how res- taurants are increasingly finding themselves on the wrong end of the attention economy, where virality often trumps veracity and bo- gus stories can spread in the blink of an eye. For some restaurant PR teams, reining in false

JOE GUSZKOWSKI

JOSEPH.GUSZKOWSKI@INFORMA.COM

RESTAURANT BUSINESS APRIL 2026

“That probably feels like a real accelerant in the last six to 12 months, is AI as a way to hypercharge that velocity and distribute it to even more of those channels instantaneous- ly,” Jarvis-Shean said. At Texas Roadhouse, Chief Communica- tions Officer Travis Doster is seeing more of all of it. He finds himself chasing down false stories almost daily, while AI-generated fakes have become a weekly occurrence. In one recent example, a TikTok user named @zandermarlow posted a video from inside a Texas Roadhouse showing what he claimed was a camera in the light fixture above the table, “watching you eat.” The possibly innocent but wildly misin- formed post generated more than 3 million views and spilled over into some news out- lets, drawing a denial from the steakhouse chain along with a detailed discussion of its lightbulbs: “There are absolutely no cameras in any of the light fixtures in our restaurant,” the com - pany said in a statement to the US Sun. “The lightbulbs we use are called ‘silver dome’ and are used to reflect light back into the fixture, reducing glare and softening brightness. We use them for guest comfort and ambiance.” While that rumor started on social media, Doster said news sites will frequently pick up those rumors and publish them without checking whether they’re true first. “It seems like somebody makes an accu- sation, and it skips the traditional route of filtering by a news organization and immedi - ately gets run,” he said. Though the story may eventually be corrected, some readers will never see it. It’s a challenging time for traditional me- dia outlets. Fewer consumers are clicking on stories and visiting news websites, thanks in part to social media and the rise of AI-pow- ered search engines and chatbots. From 2020 to 2025, average monthly traffic to the top 1,000 websites declined by more than 11%, according to data from analytics company Similarweb. The Columbia Journalism Review warned of a “traffic apocalypse” for online news. This has led to newsroom layoffs, which places more responsibility on the shoulders of fewer journalists. “They probably can’t take the time to fact check as much,” noted Schalow, which means restaurants have to be that much more vig- ilant about policing inaccuracies themselves. The news industry’s struggles have also created an environment that incentivizes the sensational. Consider this headline from Time Out Worldwide: “Olive Garden is shutting down all of its 900 stores for 24 hours. Here is why.” Spoiler alert: It was for Thanksgiving and Christmas.

FALSE STORIES HAVE BECOME A ROUTINE ISSUE FOR MANY RESTAURANTS. | RESTAURANT BUSINESS IMAGE USING AI

or misleading storylines has become a routine part of the job. In just the past couple of months: • Cracker Barrel worked to corral a misleading narrative about its em- ployee meal policy. • A seemingly AI-generated news site called Earthlings 1997 reported that BJ’s Restaurants was filing for bank - ruptcy. (It is not.) • A TikTok user claimed that Texas Roadhouse hides cameras in its over- head lighting. (It does not.) • Former Chuck E. Cheese CEO David McKillips had to publicly deny rum- ors that he’d stepped down because his name was in the Epstein files. (It was, in an innocuous list of attendees of a business conference Epstein was also attending). The idea of “fake news” is not new, but several factors have allowed it to flourish, including the dominance of social media, the rise of AI and the weakening of traditional media gatekeepers. “I think what has changed is the velocity at which it comes at us,” said Elizabeth Jar- vis-Shean, chief corporate affairs officer at DoorDash, which dealt with its own case of misinformation earlier this year. “The distri- bution channels are so much more available,”

which is why it seems to be happening more frequently. Indeed, the flashpoint for many of the above incidents is social media, where narra- tives, real or not, can quickly catch fire and cross over into mainstream news, podcasts, blogs and other outlets. At the same time, social media is becom- ing a news source in its own right. Accord- ing to the Pew Research Center, about 53% of Americans now get at least some of their news from platforms like Facebook, YouTube and TikTok. The problem is that social media is not always a reliable source. Each person’s feed is algorithmically tailored to their own views and interests, enveloping them in an informa- tion bubble that may not reflect reality. On top of that, unlike in traditional news media, social media users are under no obligation to tell the truth. “Other than shouting fire in a movie theat - er, I can kind of publish what I want,” said Jacqueline Babb, associate professor of inte - grated marketing communications at North- western University. “And so it is increasingly difficult to figure out as a consumer what’s true and not true.” Adding another layer to the issue is the rise of artificial intelligence, which is fueling the creation and distribution of fake news.

APRIL 2026 RESTAURANT BUSINESS

“I think there is a competition over where people are getting information, and you’re seeing a focus on speed and virality” from news outlets, said Liz DiTrapano, partner with ICR, a strategic communications firm that rep - resents many large restaurant chains. “It’s just about getting it out there fast and being part of the conversation.” While this might help news sites get more clicks, it also perpetuates inaccuracies, creat- ing a snowball effect that can be difficult for brands to contain. This has kept PR profes- sionals like DiTrapano on their toes. “Now you have to fight every single neg - ative or inaccurate narrative that’s out there, because if you leave it untouched, you risk having that cascade through other outlets, having that domino across social media, and you lose complete control, and you’re running to catch up,” she said. That’s one reason why DoorDash moved quickly to stomp out any connection between itself and an accusatory Reddit post that be- gan making waves online in early January. The anonymous poster claimed to be a software developer at an unnamed third-par- ty delivery app and alleged a number of ques - tionable practices by the company. They said that the company referred to delivery drivers internally as “human assets” and assigned them “desperation scores” to calculate how little it could pay them to accept delivery trips. DoorDash, which uses a host of social-me- dia monitoring tools, noticed that the story was gaining momentum, especially on X. And though the post did not point to DoorDash di- rectly, it “impugned the values and reputation of the industry as a whole,” said Jarvis-Shean. “And as a leader in the industry, if the indus- try is having its values questioned, that funda - mentally is going to be about us.” Within about 24 hours of the post going viral, CEO and founder Tony Xu denied that it was about DoorDash in a strongly worded X post. The company also published a more in-depth rebuttal on its website as a “source of truth” that people could refer back to. It was soon revealed that the Reddit post was a hoax and likely written with the help of AI. But in the moment, whether it was real was beside the point, said Jarvis-Shean. “It’s a little bit like if your house is on fire,” she said. “Maybe it’s because of an accident. Maybe it’s because of an arsonist. But your house is on fire. So you better grab a hose and a water bucket or whatever it is, and start trying to douse the flames. You can figure out who set the fire afterwards.” Both Jarvis-Shean and Schalow of Chipot- le are proponents of using software that can monitor social media and help brands gauge what people are saying about them online. Thanks to AI, these tools have become much

“NOW YOU HAVE TO FIGHT EVERY SINGLE NEGATIVE OR INACCURATE NARRATIVE THAT’S OUT THERE, BECAUSE IF YOU LEAVE IT UNTOUCHED, YOU RISK HAVING THAT CASCADE THROUGH OTHER OUTLETS, HAVING THAT DOMINO ACROSS SOCIAL MEDIA, AND YOU LOSE COMPLETE CONTROL, AND YOU’RE RUNNING TO CATCH UP.”

Liz DiTrapano, partner with ICR

more sophisticated over the past several years, said Jarvis-Shean. “It’ll give you a much better sense of con- versations … that may not name your brand directly or may not hit the keywords, but it actually is going to tell you, ‘Oh, this is some- thing you should be paying attention to,’” she said. On the PR side, DiTrapano said she has advised brands to be more proactive about engaging with the media, forging ties with reporters and getting out ahead of potentially harmful narratives. “I think that goes really far in terms of building relationships with trusted media out- lets that are going to get truthful stories out there,” she said. “They’re not always going to be positive, but they’re going to be accurate.” Ultimately, restaurant brands can’t con- trol what is said about them on social media, noted Babb, the Northwestern professor. What they can control is the experience they provide in their restaurants and how they treat customers and employees. She offered the example of Jeni’s Splendid Ice Cream, which in 2015 learned that listeria had been detected in a sample of its ice cream. Though no illnesses were ever reported, the chain responded by closing its Columbus manufacturing plant and its 20 shops and re-

calling 265 tons of ice cream. It cost the company millions of dollars, but it built trust with customers, who returned in droves when Jeni’s eventually reopened. To- day, the chain has nearly 100 shops and saw sales growth of 16% in 2024, per Technomic data. The message for restaurants: “If people think the best of you, they’ll give you the ben- efit of the doubt,” Babb said. “But if you have a poor reputation, they won’t.” That has proven true for Texas Road- house, which has remained one of the strong- est and fastest-growing restaurant chains in the industry despite what some people may mistakenly believe about its lightbulbs. Doster said he hears from customers all the time who want to confirm something they’ve seen floating around online. They’re also looking out for the brand. One person wrote to Doster recently to tip him off about an Indiana doughnut shop selling “Texas Roadhouse doughnuts” made with the chain’s retail honey butter. “People are helping protect us,” Doster said. “I think our operators have done a great job of building goodwill within their commu- nities. And so a lot of times, even with the lightbulb story, people assume the positive about our stores.”

RESTAURANT BUSINESS APRIL 2026

EMERGING BRANDS

RICE MEDITERRANEAN KITCHEN BRINGS PERSIAN FLAVORS TO THE TABLE This Iranian-American family has been slowly building a fast-casual Mediterranean brand with a Persian twist. It couldn’t be more relevant.

BY LISA JENNINGS LISA. JENNINGS@INFORMA.COM

PHOTO COURTESY OF RICE MEDITERRANEAN KITCHEN

T hirty years ago, when Jafar Shabani moved to Miami, there wasn’t much in the way of Mediterranean food— and especially not Persian cuisine. But that’s the way Shabani and his family wanted to eat. So he and his brother set out to create a restaurant that represented the fresh ingredients, grilled proteins, herbs and spices, and rice that they grew up with as Iranian-Americans. So Rice Mediterranean Kitchen was born. Now celebrating its 20th anniversary, Rice Kitchen, as it is known, recently opened

its 10th location in South Florida. The latest unit is in Coconut Grove. Over two decades, the fast-casual concept has evolved. And so has the American understanding of Mediterranean cuisine. Restaurant chains that call themselves “Mediterranean” tend to borrow a mishmash of flavors from across the Middle East, including Greece, Israel, Lebanon or Turkey. Mediterranean cuisine has also been embraced as healthful. This has benefited the Greek-inspired Cava, now with 439 units, which has become a category leader with

only distant competitors. The 50-unit Luna Grill has Persian roots, but the menu there has also evolved to become more broadly Mediterranean. But Shabani, who is now CEO, sees a lot of white space for a more Iranian-inflected version of Mediterranean fast casual. He wanted to make Rice Mediterranean Kitchen’s Persian influence clear. War has brought a surge in interest in the views of the Iranian-American community.

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“NO MATTER WHAT IS HAPPENING IN THE WORLD, FOOD ALWAYS BRINGS PEOPLE TOGETHER.” Jafar Shabani, CEO, Rice Mediterranean Kitchen

And, although Shabani doesn’t want to get into political issues, he believes strongly that food can be a powerful way for people to build understanding of other countries and their cultures. “No matter what’s happening in the world, food always brings people together,” he said. “Our core is not only introducing our Persian flavors and culture, but I really believe that food is one of the most powerful ways cultures meet.” That’s why, in part, Rice Mediterranean Kitchen on its menu offers Chicken Joojeh and Tenderloin Chenjeh, for example, both Persian-style kabobs marinated in saffron, lemon, yogurt and onions, as well as kubideh, made with ground beef. The Iranian descriptors are used, rather than a more bland “chicken kabob,” or “beef kabob.” There are more traditional braised beef and chicken dishes, along with a spicy roast chicken platter, all, of course, served with basmati saffron rice and a fresh salad—or fries. And there are bowls, in the style of Cava.

Shabani said Persian food doesn’t typically include the sort of sauces that Americans have embraced as Mediterranean. But in a concession to American tastes, Rice Mediterranean Kitchen developed a yogurt- based Sumac Sauce that has become a huge hit. The chain even makes its own yogurt, because Shabani said they weren’t able to find the right flavor profile from suppliers. “It’s labor-intensive, but it’s worth it,” he said. Typically about 1,800- to 3,500-square feet, Rice Kitchen units also have an emphasis on high design. Even the takeout bags are something special. Shabani said the chain invested in four designs for reusable insulated bags that serve as walking billboards. “It’s not something people will just trash right away,” he said. “You see people using them to go grocery shopping or to the beach.” At the newest location in Coconut Grove, Shabani is experimenting with an expanded coffee program, as well as Persian teas with

cardamon and rosewater, and drinks with pomegranate and cherry syrups. It’s a test to see if there’s demand for the beverages. But the restaurants also offer desserts, like baklavas, made by a local bakery, and the setting invites sitting down and staying a while. So far, the family-owned chain has grown organically without any outside investment. Shabani said they would like to continue to grow—the chain is looking for one to two more sites to add more in South Florida this year. But they are in no hurry, he said. There are no plans to franchise. The family would welcome the right investors to help them scale, but, for now, the focus is on building a strong brand and building awareness of Persian cuisine, which is Rice Mediterranean Kitchen’s differentiator. “What we do is a little different and there aren’t that many concepts tapping into that market,” he said. “We are making sure that if we do want to scale, if we are at that position, that we have the backbone for that.”

APRIL 2026 RESTAURANT BUSINESS

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