The promise of endless salads and breadsticks has long been a key part of the Olive Garden experience, an iconic opening for your large bowl of mutton rolls or sticky lasagna.
But a radical investor said this week that Dutton, the parent company of the Olive Garden, was too generous in handing out bread sticks and salads --
The struggling casual dining chain can hardly afford the cost of wasting food and expanding.
Investor Starboard Value is not suggesting that the Olive Garden give up free bread and salad.
It just said that the restaurant was not implementing the policy well.
But this criticism is part of a Starboard attack on all non-starboard attacks.
The menu in the Olive Garden has the Italian option to choose not to use salt in pasta water.
At the same time, Denton is trying to reverse the situation of the casual catering chain.
Darden reported on Friday that sales at Olive Garden restaurants have declined for at least a year.
The latest quarter was 3%.
Shares of the company fell more than 10% this year, fell again on Friday and fell another 2% in afternoon trading.
Starboard wants to clean up the house on the board of dadden and has nominated 12 new faces for 12 peopleperson board.
Darden offered four of his own nominees to update the board on the grounds of fear that a complete reform would undermine stability.
Shareholders will vote on the formation of the new board next month.
At the same time, Starboard, which owns about eight shares in Denton, targeted the bread sticks of the Olive Garden.
In an extensive presentation outlining Darton's turnaround strategy, Starboard said that servers often bring too many breadsticks.
They should bring a breadstick for each guest plus a breadstick, but they find that servers often pile up more breadsticks.
If the customer asks, they should only bring more bread sticks to the table.
This has increased to 0. 7 billion to one bread stick per year, with an average of three customers, says Starboard.
Since most customers don't eat three sticks, Starboard believes that the company can save up to $5 million as long as it offers more strategic access to its unlimited sticks.
Starboard is a top. to-
The bottom floor assessment of a chain restaurant in distress.
Olive Garden is the largest and most well-known brand in the Darton restaurant, including the Long Horn Steak House, Capital Grille and the Bahamas breeze. (
The company sells Red Lobster to a private company.
Equity firms earlier this year. )
Darden responded with a statement to Starboard's plan, outlining the progress that the company believes its "brand revival plan" has made. "We remain open --
All ideas that support long term
"Creating long-term value for shareholders and improving the dining experience for guests," Gene Lee, president and chief operating officer of Denton, said in a statement . ".
"While we will review Starboard's plans carefully and thoughtfully after the initial review, which has been committed for some time, we believe our company is already implementing many brand and cost optimization strategies, results are being achieved.
"The company has improved the online ordering capability of the Olive Garden to better compete for takeout
Dining out, re-decorating the tried-out restaurant, rethinking the menu, and considering adding a tablet to the table for easy ordering.
The test of the tablet shows that
About the sale of goods and faster table turnover.
"Overall, I think they are moving in the right direction," said Lynne Collier, an analyst at Sterne Agee, who covers the catering industry.
Nevertheless, the Starboard statement did not reveal that it believed Darton had lost his way.
It called on the company to reduce food quality and "mushy, unattractive" pasta.
"It's shocking that the Olive Garden is no longer adding salt to the water used to cook pasta, just to get a longer warranty on its pan," the presentation said . ".
"This shocking decision suggests that the level of emphasis placed by management on delivering a quality experience to guests is so low.
While Starboard says the Olive Garden's bread sticks have "revolutionized the casual dining industry", it believes their quality has deteriorated.
"The low quality powdered bread sticks served today are filled with more air and taste less (
Hot dog buns. )
"The Starboard assessment includes a lot of other suggestions about food, including trimming the long menu and removing non-
Traditional Italian cuisine, such as hamburgers and snacks, and more consistent preparation of dishes in different restaurants.
Dennis Lombardi, executive vice president, food service strategy, WD Partners, retail consultancy, said,
Focusing on the menu can be an effective way to grow your business.
"I think they can keep the traditional Italian mode menu well," said Lombardi . ".
"But what I think they can do is, in this category, continue to look at healthier choices, lighter parts, and things of this nature.
The investor also pointed out that alcoholic beverages accounted for only eight of the total sales of Olive Garden restaurants, lower than competitors such as Maggiano, Romano Macaroni Grill or Cheesecake Factory.
Starboard recommends launching happy hour promotions and providing better wine training for waiters, which may be a way to help improve liquor sales.
Even criticized at the end of the meal: Starboard complaining about the Olive Garden fantasy
Go to the container and think the customer does not need a dishwashersafe carton. n.
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