A group of leading hospitality operators addressed the challenging topics of ignition interlock and menu labeling, hot-button issues for all restaurant and bar operators, during the June Cheers Roundtable Discussion held at the Phillips Seafood headquarters in Baltimore, Md. Both issues currently are playing out in various arenas across the country, and their outcomes have serious implications for bar and restaurant operators. Should ignition interlock become standard equipment on all cars, restaurant operators anticipate a severe decline in on-premise beverage alcohol sales. With new menu labeling regulations going into effect, assembling and presenting nutrition information on every food and beverage item is proving onerous and costly for operators. While navigating these complex issues, our panel voiced serious concern about the impact on their businesses, as well as a strong desire to influence the final regulations.
Nine states—Alaska, Arizona, New Mexico, Illinois, Louisiana, Oregon, Nebraska, Colorado and Washington—currently mandate ignition interlocks be installed on the vehicles of first time drunk driving offenders with low BAC. Recently, similar proposals in California, South Carolina, Virginia and West Virginia were amended to require ignition interlocks only for high BAC, repeat offenders. This is the application favored by the American Beverage Institute, the industry advocacy group based in Washington, D.C. composed of restaurant chains, beverage suppliers and allied companies. The concern among ABI members is that low BAC first offender laws will lead to ignition interlocks becoming “universal”—standard equipment in all vehicles. Mothers Against Drunk Driving (MADD) is the primary driver behind ignition interlock legislation, and it advocates universal ignition interlocks.
While a breathalyzer is the current device, technological advances are making interlocks fairly invisible to drivers. Transdermal sensors on steering wheels and other surfaces, optical scans, odor sensors and breathalyzers on key fobs are less intrusive and some can test BAC randomly without the driver’s participation. These devices likely would be set much lower than the current intoxication level of 0.08 percent BAC to allow for a margin of error.
Cheers: Some of you operate in states where ignition interlock is mandated for low BAC first offenders. Has it impacted beverage sales?
Mary Melton: Definitely. In Arizona, off the top of my head, 25 percent of liquor sales were lost when ignition interlock went into eff ect. The regulation snuck up on us, and now we’re stuck with it. Operators should get involved before it happens to them.
Cheers: How much do consumers understand about ignition interlock?
Bill Irvin: I’ve been standing at a bar, having a drink with people and talking about it. They think it’s a good idea on the surface. But when you point out that after that drink they might not be able to start their car… Well, the tone changes. Bottom line: They’re not going to drink if they have that device in their car. We make the highest profit on beverage, so we need to address this issue. We have to make the responsible consumers understand what universal ignition interlock means to them.
Stan Novack: The American Beverage Institute (ABI) is very vocal on it and working to be proactive and educate consumers. But industry associations—NBWA, DISCUS, Beer Institute, for example—are not coming along. DISCUS says it’s not in favor of low BAC fi rst offender ignition interlock, but it won’t come out in favor of the ABI media campaign to educate on the threat of universal application.
It’s like the 0.08 percent BAC fight. They’re afraid of how the industry will be perceived if they come out against it. But if you go that route, ignition interlock will become standard on all cars.
Cheers: So the industry is fractured on the issue? How can we mend the rift?
Novack: There is a spit between restaurant operators and some suppliers. We’ve had discussions, but there’s no movement yet. The thing to say is that ignition interlocks have their place— they’re for high BAC repeat drunk driving off enders—and then ask the responsible consumer, “Do you want this in your car?” A public education campaign, like the one ABI is mount-ing, is very important.
Elizabeth DeConti: As operators, when would you want to be involved in the process? These bills can take up to three years to go through, and bill tracker services such as LexisNexis and Thomson West can help you keep tabs on its progress. It’s easy and the cost is minimal. Irvin: I like the idea of a bil tracker. I was involved with the smoking ban fight and I was amazed that nooperators] showed up at hearings. They all waited until the last day, when it’s all over the news, but it’s too late. We need to get involved early on.
Cheers: Do you discuss this in your organizations?
Marc Sachs: It’s discussed, but not openly or often. Th e C-level is aware of it, but it’s difficult to know where to go on it.
Irvin: Get it down to taking 25 percent off the balance sheet and you’ll have their attention. People will change their habits pretty quickly.
Melton: We’re now running a test in Arizona stores where we’ve adjusted prices downward on alcohol to see if people will come back to ordering a drink. We aren’t promoting the lower prices; we just changed them on the menu. It will be interesting to see what happens, if anything.
Doug Zeif: Ignition interlock will stimulate diff erent choices. If you’re only having one, you’re going to make it a good one.
Cheers: Who has the most to lose if ignition interlock becomes standard in all cars?
Novack: It won’t kill the restaurant industry, but it sure will change it. We’ll lose a big part of our profits. We can survive, but it won’t be comfortable.
Sachs: Ours is a difficult position to be in. Part of my head says it’s good—I have kids, after all—but the other part says it’s not good for my business. You’re punishing the many for the sins of the few.
Ed Farley: I like this philosophy on educating the consumer. We’re in a business of cultivating responsibility, and as a company we’ve spent millions on advocating personal responsibility. We can add value to that effort, and also to server training and new programs to get customers in the habit of moderation.
Sachs: Yes, A-B’s done a great job. Now we need to come together as an industry on this issue.
While moves to require nutrition and calorie content on restaurant menus are generating headlines lately, it’s not new. When an extension of the Nutrition Labeling & Education Act of 1990 that applied to food in restaurants failed on the federal level, advocates including the Center for Science in the Public Interest (CSPI) moved the push to the state and local levels.
Menu labeling regulations put forth by the New York City Board of Health, which includes beverage alcohol, were passed in New York in January. After legal wrangling, the regulations went into effect March 31 but gave operators until July 18 to comply, and various bodies including the New York State Restaurant Association are appealing the ruling. An appeals decision should be rendered before July 18.
In March, health officials in King County, Wash. compromised with the state restaurant association by amending regulation to allow more flexible presentation of nutrition information. The regulation includes beverage alcohol and took effect in August, with full compliance mandatory by the end of December.
The San Francisco Board of Supervisors approved a menu labeling regulation in March that excludes beverage alcohol, and Georgia and Florida each recently passed legislation pre-empting local municipalities from enacting menu labeling regulations. State-wide menu labeling regulations are being considered in California and New York; proposals are also on the table in Chicago, Philadelphia and Washington, D.C.
One difficulty restaurant operators face is sourcing nutritional information on the products used to create the dishes and drinks on their menus. Currently, the only standard source of nutrition information on beverage alcohol is the USDA Nutritional Database, http://www.nal.usda.gov/fnic/foodcomp/search/.
The National Restaurant Association (NRA) supports broader access to nutrition information but opposes “one size fits all” regulations that do not take into account the various formats and service styles of the different segments of the industry. In addition, NRA asserts that operators should have flexibility in how nutrition information is presented to the guest, and it asks that more effort be made in educating the guest to fully understand the information.
Cheers: Menu labeling laws are in effect in three markets—New York City, San Francisco and King County, Wash., which includes Seattle. What’s your gut reaction?
Zeif: My hope is that, going forward, it falls short of being legislated and we get to do it ourselves. Right now, most menu development is done by the marketing calendar. This could make us be more thoughtful about what we put in front of the guest.
Sachs: The guest needs to make informed choices. Some restaurants are now scurrying to get this information. At Uno, we already have all that information at our fi ngertips, and we’ve put it at the guests’ fingertips through our touch screen kiosks in every store.
Melton: Our food nutrition information comes from the Genesis database. On the drink side, we’ve asked some suppliers and found that in some cases they have no idea of the nutrition and calorie content of their products.
Novack: It’s sticky. We’re not manufacturers, we’re in food prep. If a cook doesn’t follow a recipe, the nutritionals will be different.
Zeif: I don’t think the consumer ultimately cares about caloric content when dining out. They go out for a variety of reasons, but the primary one is to release and relax.
Sachs: The guest is looking for choice. We’re known for deep dish pizza, but we also have healthier options. We have a saying at Uno: You have every right to leave our restaurant as healthy as when you entered. We hang our hats on offering healthy choices, but we still have indulgent items.
Novack: We all have healthy options, we just don’t want to be told by the “food police” what to menu. And it may come to that.
Cheers: Marc, how difficult was it to list the caloric content of beverages as required in New York City now?
Sachs: The spirits suppliers were all over it; Diageo, Pernod Ricard—they have the information readily available. We also got the beer information easily. A-B’s web site was incredible, for example. And wine was fairly easy; there’s not as much caloric variation among wines as you might expect. Printing the new panels was costly. There’s no way to make it look nice, either. The type size of the price on the menu must be the size used for calorie content. It looks out of place.
Irvin: Has your sales mix changed?
Sachs: It’s too soon to tell. I don’t think beer will be aff ected, but cocktails will. Irvin: I would think so. At Phillips, we sell a lot of frozen drinks. If you tell them [the caloric content], we won’t sell too many. Our demographic is tourists—they’re looking to indulge—but the nitty-gritty of calories will hurt the business.
Cheers: The regulations now in place vary. What’s your wish list for how this should go?
Melton: Not on the menu!
Sachs: Right—not on the menu and no alcohol content.
DeConti: You’re going to see a wave of local, state and then federal regulations. There are so many questions for operators because the bodies making the regulations don’t understand your business. When you switch ingredients, do you have to reprint the menus? What happens when a bartender deviates?
Melton: That’s what we worry about. Our bartenders free pour. We’re testing jiggers.
Sachs: In New York, the regulation applies only to what appears on the menu. If the guest requests Grand Marnier instead of Cointreau, that’s fine, so long as the caloric content appears for the drink described on the menu.
Melton: The bottom line is that we don’t want it on the menu and we need a standard source of information.
Cheers: How would you prefer to present the information to the guest?
Melton: Hand them a booklet if they request the information.
Sachs: Nutritional information is the number one thing requested by the guest at our kiosks. They work.
Zeif: I agree—not on the menu. Putting it in your face takes away from the dining experience.
Richard Krumm: Absolutely. Our menus are already filled up with so much other information. If you’re not paying attention to health and the environment, you’re not competing. But, you don’t go out to eat in New Orleans to count calories. You have to deliver what the guest wants, how they want it.
Cheers: What’s next on this issue? Irvin: Absolutely we need to band together. I’m concerned whether the one-, two- or three-unit operator even is aware that they’re next. This is going to really hurt them.
Novack: Right now, they’re going after the chain restaurants, but the little guys will be next.
Food & Beverage Director Ralph Brennan Restaurants
Corporate Beverage Manager
Uno Chicago Grill
Director of Beverage
P.F. Chang’s China Bistro
Doug Zeif Vice President
Food & Beverage
LXR Luxury Resorts & Hotels
Director of Operations
Phillips Seafood Restaurants
Vice President, Concept Development
Director, On-Premise Operations National Retail Sales
Senior Vice President & Group Publisher
Conference Program Director
Donna Hood Crecca