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AAFES QSR/NBFF Exchange QSR Clicks with Customers

he bar has been raised in quick- serve (QSR), and it’s ‘Customers are demanding a continuous variety of new, innovative, Tnot just the menu this time, specialty and better-for-you food offerings and millennial-targeted although that has been raised, too. High-tech has come to food, and cus- tomers expect electronic ordering and brands. Social-media-inspired food fads, and the latest trending new menu options that rival the best main product releases, smart phone app ordering/payment and online street has to offer. Whether looking for a order/delivery are now the expected norms by customers in the or a garden salad, a sub or a wrap, the dining options offered by dining experience.’ — Michael Deerhake, AAFES vice president (VP), the Army & Air Force Exchange Service Food, Fuel and Theater Operations (AAFES) are nearly endless and mirror Deerhake much of the variety found outside the gate. With 1,712 restaurants in its worldwide QSR freeze,” he said in early April before the freeze newest brands in our portfolio.” He added that portfolio, most of them name-brand was lifted, “is the most problematic challenge the Exchange opened/converted 68 restaurants in (NBFF) operations. AAFES delivers the branded we are currently facing, especially now when we 2016 and anticipates similar development for 2017. experience A (A&W) to nearly Z () and are expanding on opportunities to develop the Primacy for name-brand casual dining (NBCD) everything in between. Michael Deerhake, vice president (VP) of the Exchange’s Food, Fuel and Theater Operations, AAFES offers more than 1,700 restaurants in its which oversees the QSR portfolio, reported that worldwide QSR portfolio — including this one at fiscal 2016 sales for these entities were $867 million, Barksdale AFB, La. — presenting patrons with numer- or 1.4-percent above the previous ous choices to fit their nutritional and dining needs. year. He noted that AAFES “expects to achieve a slightly higher growth BREAKDOWN BY TYPE rate in 2017,” but numerous trends OF VENUE influence sales. VENUE TOTAL IMPACTFUL TRENDS NBFF Direct 832 Although Deerhake explained, Generic Concession 303 NBFF Concession 283 “The business and trends Signature Direct 100 that impact us are not unique to School Cafeterias 78 the Exchange, but shared through- Theaters 76 out the commercial market seg- Generic Direct 33 AAFES PHOTOS ment,” one of the major trends Plants 7 Total 1,712 that had recently impacted AAFES’s restaurants was military-specific. Current as of April 26, 2017. “The current mandated hiring Source: AAFES

Low-Calorie and HFY Choices Expansion Continues

For Soldiers, Airmen and family members on the go, Ex- families with the nutrition they need to stay ready to protect change Express locations and direct-operated restaurants are America’s freedom.” making concerted efforts to increase servicemember access to healthier for you (HFY) snacks and salads, helping support the SALAD WEDNESDAYS Exchange’s larger BE FIT initiative. Express stores offer several Another part of the Exchange’s BE FIT initiative is “Salad new snack options for a quick workout fuel-up, including the Wednesday.” Designed to promote healthy lifestyles for Soldiers, low-sugar, high-protein Krave Bar, available in flavors such as Airmen, retirees and military families, every Wednesday, diners Chipotle Cherry Beef and Mango Jalapeno Pork. can take $2 off any salad priced $4 or more at participating Shoppers hungry and in a hurry can also grab Bumble Bee Exchange direct-operated restaurants. tuna pouches in flavors such as Jalapeno, Thai Chili, Lemon “Eating healthy is essential to not only force readiness and Reyes Pepper, and Sun-Dried Tomato and Basil. More than 100 Ex- resiliency but the development of healthy, happy military press island coolers also now feature wraps, salads, hummus, children,” Reyes said. “The Exchange wants to help military yogurt, fresh fruit, milk and hard-boiled eggs. families get the nutrition they need — without breaking the bank.” “The Exchange recognizes how challenging it can be to eat healthy In addition to “Salad Wednesday” savings, diners who use their Mili- while balancing a military career with family responsibilities,” said Air tary Star card will receive the everyday additional 10-percent discount Force Chief Master Sgt. Luis Reyes, the Exchange’s senior enlisted advi- at Exchange restaurants, which are open to anyone — whether military, sor. “That’s why Express stores worldwide offer 348 BE FIT-approved civil service, contractor or visitor — per Army Regulation 215-8 and Air items. We couldn’t be more proud to provide servicemembers and their Force Instruction 34-211 (I).

MAY 2017 EXCHANGE and COMMISSARY NEWS AAFES Quick Service Restaurant (QSR) Portfolio

DIRECT- DIRECT- DIRECT- BRAND PARTNERS RUN CONCESSIONS TOTAL BRAND PARTNERS RUN CONCESSIONS TOTAL BRAND PARTNERS RUN CONCESSIONS TOTAL A&W All American Food 1 0 1 Frëshens 1 2 3 0 1 1 Arby’s 27 0 27 Froots 0 2 2 Louisiana Kitchen 77 2 79 Auntie Anne’s 0 3 3 Godfather’s Pizza 1 0 1 Mexican Eats 6 1 7 Baskin-Robbins 30 4 34 Green Beans 0 36 36 0 1 1 7 1 8 Healthy Pizza Company 0 1 1 Rice King 0 1 1 15 0 15 0 1 1 Sarku 0 2 2 Bruster’s Ice Cream 0 1 1 Jimmy John’s Gourmet 0 5 5 ’s Best Coffee 4 0 4 0 1 1 1 0 1 0 1 1 Bun-D 0 4 4 KFC 0 4 4 Smoothies-N-Things Cafe 0 1 1 162 5 167 0 1 1 0 7 7 Captain D’s 2 0 2 18 0 18 66 16 82 Charley’s 100 1 101 Marco’s Pizza 0 2 2 155 69 224 0 2 2 McAlister’s Deli 0 1 1 72 8 80 Churchs Chicken 2 0 2 McDonald’s 0 3 3 Taco John’s 4 0 4 7 0 7 Menchies Frozen Yogurt 0 1 1 Texas Roadhouse 0 1 1 0 2 2 Muscle Maker Grill 0 1 1 0 2 2 0 1 1 Nando’s Peri-Peri Chicken 0 1 1 Wing Zone 10 0 10 Denny’s 2 0 2 Noble Roman’s Pizza 0 1 1 Total 832 283 1,115 Dickey’s Pit 0 2 2 0 3 3 Domino’s 2 32 34 Papa John’s 0 8 8 Current as of April 26, 2017. Dunkin’ Donuts 14 12 26 /WingStreet 28 23 51 Source: AAFES Einstein Bros. Bagels 18 0 18 Pizza Inn 0 3 3 development on the installations AAFES SIGNATURE The executive said that there AAFES serves belongs to the Ex- IN-HOUSE BRANDS are low-calorie and better-for- change’s nonappropriated fund you menu choices at all of the (NAF) counterparts, the Army Fam- VENUE TOTAL Exchange’s 1,712 restaurants. AAFES IMAGE ily Morale, Welfare and Recreation American Eatery 18 Command (FMWRC) and Air Force Anthony’s Pizza 56 LOW-CALORIE SPOTLIGHT Main Street 14 Services Activity (AFSVA). Robin Hood 6 Among the restaurants in Other trends encompass the en- Special T 6 AAFES food courts providing low- tire commercial market segment. Total 100 calorie options, Deerhake said, are: “Customers are demanding a con- • Subway Sandwich Shops 200- tinuous variety of new, innovative, All signature brands are direct-run operations. plus stores on Army and Air Force As of April 26, 2017 specialty and better-for-you food Source: AAFES installations carry more than 45 offerings and millennial-targeted items with less than 350 calories, brands,” he said. “Social-media- including the Breast and inspired food fads, and the latest trending new Oven Roasted Chicken sandwiches and steak and product releases, smart phone app ordering/ garden salads. payment and online order/delivery are now the • Boston Market, with 15 restaurants, offers • Exchange Charley’s Philly Steaks’ 101 res- expected norms by customers in the dining ex- 25 menu items with less than 350 calories and taurants offer a variety of items with 350 calories perience.” Deerhake added, “Our pizza delivery more than 100 meal combinations containing or less. locations utilize electronic ordering.” less than 500 calories. • Seven Qdoba Mexican Eats entrees are made With servicemember fitness and readiness in • At 79 Exchange Popeyes Louisiana Kitchens, with better-for-you ingredients, with several en- the spotlight the last several years, the Exchange diners can choose from more than 20 items with trees containing less than 500 calories. has been especially conscious of enhancing, where less than 350 calories. —E and C NEWS it makes business sense, the number of “better for you” (BFY) and low-calories options in stores and restaurants. Looking at the Exchange’s quick- serve restaurant portfolio, Deerhake pointed to a number of examples of restaurants with BFY and low-calorie options. “The Exchange introduced more better-for-you brands in 2016: 10 Boston Markets, six Qdoba Mexican Eats, two Chipotle Mexican Grills and Frëshens Fresh Food Studio,” he noted. “Response from our patrons in support of these brand in- troductions is such that we are continuing future development where possible.”

Deerhake said that AAFES is not alone in trying PHOTO: OTTO SCHULZE to make its restaurant menus better; “The entire QSR industry is responding and transforming by adding healthier choices to their menus, and will continue to experience this menu evolvement as Servicemembers, their families and others brands determine and anticipate customer demand. take a break at the Grand Hall Food Court, In this vein, our current brands are evolving their Freedom Crossing at Fort Bliss, Texas menus.” EXCHANGE and COMMISSARY NEWS MAY 2017