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News Briefs for October 27, 2011

October 27, 2011

•In a quarterly report submitted to the U.S. Securities and Exchange Commission yesterday, Google revealed that it paid $151 million in cash for restaurant and hospitality survey group Zagat. The price wasn’t disclosed when the deal was announced last month. Google also reported that it paid $114 million for Daily Deals GmbH, a German-based e-commerce deals company, as part of an effort to enhance its recently launched Google Offers venture. The acquisitions are expected to bolster Google’s local market business, helping the company compete against local search site Yelp (which Google tried to buy in 2009 for $500 million), online restaurant booking and review service OpenTable and daily local deal sites like Groupon.

•In honor of Mexico’s upcoming Día de los Muertos (The Day of the Dead) holiday, Diageo NA has adorned the Jose Cuervo Tradicional line with thermochromic labels that come to life when the Tequila is chilled to temperatures between 32F and 42F. As bottles of the limited-edition 100% agave line chill, the tattoo-like skeletal and floral imagery becomes more defined, with its colors turning deeper shades.

•Lucas Bols USA has launched Bols Barrel Aged Genever in select U.S. markets. Made with a combination of traditional genever and American aged-whiskey practices, Bols Barrel Aged Genever is targeted toward Bourbon and American whiskey connoisseurs. Aged for 18 months in oak casks, the new expression is priced at $49.99 a 750-ml. Lucas Bols opened its U.S. division just last year, and has placed an increased focus on growing its super-premium Bols genever and Galliano liqueur brands in the market of late.

•Chili’s restaurant chain saw same-store sales rise 1.7% at company-owned locations in its fiscal first quarter ended September 28, while guest traffic increased 1.9%. Chili’s attributed the growth to higher menu prices as well as the popularity of promotions like $6.99 lunch combos and 2-for-$20 dinner deals. Parent company Brinker International saw first quarter earnings rise by 10% as revenue came in up 2.1% to $668.4 million. The results marked the third straight quarter in which Brinker’s same-store sales and customer traffic increased, following consistent declines since the start of the economic downturn.

•Net income at Ruth’s Hospitality Group rose to $85,000 for the third quarter ended September 25th, compared with last year’s net loss of $477,000 over the year-earlier period. The company, which operates restaurant chains Ruth’s Chris Steak House and Mitchell’s Fish Market, reported a revenue increase of 2% to $80.2 million, compared with $78.6 million over the same period last year. Same-store sales at the more than 120-unit Ruth’s Chris Steak House rose 2.4%, while same-store sales at the 20-unit Mitchell’s Fish Market declined 0.7%. To encourage traffic flow to Ruth’s Chris Steak House, the company is launching a new television advertising campaign, and for both the steak house and Mitchell’s Fish Market, fixed-price meal options are being rolled out for value-driven consumers.

•The Massachusetts State Senate passed an amendment this month to a casino bill that would allow state restaurants and bars to offer happy hour drink deals, a practice outlawed in Massachusetts more than 25 years ago. The casino bill calls for construction of three casinos with the permission to serve discounted or free alcoholic beverages to patrons. The bill has yet to reach Massachusetts Governor Deval Patrick’s desk, as the Massachusetts House of Representative still must reconcile differences with the Senate.

•The Distilled Spirits Council of the U.S. (DISCUS) is speaking out against a proposal in Cook County, Illinois to raise spirits taxes by 25%, calling it a job-killing measure for the local hospitality industry. Cook County Board President Toni Preckwinkle has proposed an increase of the county excise tax on spirits to $2.50 per gallon, up from the current $2.00 per gallon. According to DISCUS, the hospitality industry in Chicago is still down 13,000 jobs from when the recession began. The city has had three tax hikes in recent years—two city tax increases in 2005 and 2008, and one state excise tax increase in 2009—which have nearly doubled spirits taxes.

 

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