Armed with flashlights and calculators, Orange County restaurant operators are readying for the rolling blackouts they have faced at their Northern California facilities.
Locally based restaurant chains such as Carl’s Jr., Del Taco and Johnny Rockets say they already have felt the fallout from the state’s power crunch. They have stores and franchisees in areas affected by the high energy prices in San Diego and the sudden outages in the north.
The power crunch also has had less direct effects on restaurant chains. Kevin Moriarty, chief executive of Laguna Hills-based Del Taco Inc., said energy cutbacks put his top tortilla supplier, Mission Foods Corp. in Rancho Cucamonga, out of commission for two days. The Mexican fast-food chain had a second supplier,Arevalos Tortillera in Montebello,to fall back on, he said.
“As we have gotten bigger, we had been using a second company to produce our recipe,” Moriarty said. “So it wasn’t a huge problem.”
Del Taco, which operates 303 restaurants in California, saw some of its stores in the Sacramento area lose energy for about an hour during blackouts this month, Moriarty said. But the stores came out unscathed, he said.
“We’ve done some planning and have procedures in place to ensure safety,” Moriarty said. “We bought more flashlights and battery calculators so they have basic equipment on board. Our employees are trained to escort customers out of the store and lock the restaurant and dispose of food.”
Restaurants have to worry about more than just the lights going out. They face health-related hazards if food isn’t kept frozen or cooked at high temperatures. Water, too, must be heated enough to prevent infection. If the power goes off for more than an hour or two, restaurants may end up not only losing business but also throwing out food.
Laguna Hills-based Johnny Rockets Inc. operates 142 restaurants in 25 states, including 12 in Northern California and 26 in the Southland.
“We’ve had outages in San Francisco that have affected three or four stores,” Chief Executive Mike Shumsky said. “Things were shut down for between 45 minutes to an hour and a half. We just have to grin and bear it. We can’t cook things, so customers are fairly patient.”
Managers at Johnny Rockets stores have been briefed on safety procedures and given flashlights to cope with blackouts. But Shumsky says he’s not too concerned about short-term blackouts. So far the outages haven’t lasted long enough to spoil the food, he said, though longer outages might lead to product losses.
Generators are not an option for mall-based operations such as Johnny Rockets, Shumsky said, because these gas-operated machines are unsafe for use inside restaurants.
Laurie Gannon, director of public relations for Irvine-based Taco Bell Corp., said her company’s chain has not incurred any major incidents.
“We haven’t had any big problems,” she said. “We are all on alert and know what to do if a situation arises.”
Newport Beach-based Weinerschnitzel Inc., which franchises 120 restaurants in Northern California including 35 in the Bay area, has reported several blackouts at stores, mostly in the San Jose area.
“We recommend that our crew and management not leave the stores in case of vandalism or robbery,” said Lowry Hughes, vice president of operations. “We expected the blackouts will be short-lived and have equipped staff with calculators and canned Pepsi.”
The company uses gas stoves to cook its food. So Weinerschnitzel still is able to serve during short outages, he said.
The San Diego energy price increases seen last summer were more of an issue for Weinerschnitzel. Area stores saw monthly utility bills double from roughly $1,500 to $3,000, he said. Those rates have since been scaled back.
Some of the biggest energy users are theme-restaurant operators such as Dave & Busters Inc., with stores in the Block at Orange and Irvine Spectrum Center, and Rainforest Caf & #233; with units at South Coast Plaza and Downtown Disney.
Nearly two years ago, Dallas-based Dave & Busters, which operates big stores featuring flashy midway games, took a step to conserve energy with a program called “Power up. Power down.”
“We worked with the power companies to have inspections of units and found out that if we turn on our midway games one hour later than usual we would save ourselves $400 a month per store,” said R. Lee Pitts, vice president of training. “Our California stores are now going back in and seeing if we can turn them on later and stagger games so when we open the doors there is not one big power surge.”
The energy conservation program at Dave & Busters also includes staggering the startup of its kitchen grills and equipment.
Restaurants are small businesses but they use more power than other similar-size operations because of the refrigerators, freezers, stoves, lighting, and water heaters they require. And the power crunch comes on the heels of a 50-cent minimum wage increase on Jan. 1, higher gas prices and increased workers’ compensation costs, said John Dunlap, president of the California Restaurant Association in Sacramento. He predicts the added cost for restaurants will trickle down to consumers.
“The latest energy crisis could signal the death of the 99-cent hamburger,” Dunlap said. “Quick-service restaurants want to provide great value to consumers, but when you have these kinds of economic impacts, it’s difficult for them to hold the line. There will be restaurant price increases,if not now, then in the future,because of this energy increase.”
Like other companies, Del Taco is looking for ways to conserve energy. In the past few years, the company replaced its old fryers with more energy-efficient ones. Now it’s looking at doing the same with its light bulbs, Moriarty said.
“We can’t pass all the costs on, but we can’t eat it all, either,” he said. “We took a minimal 1.2% price increase in January on selected items.” n
