LYFE Kitchen, Clover Compete in QSR Race for Healthy Millennials

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Thanks to the efforts of a handful of entrepreneurs, American fast food is moving from a form of nutritional epithet to add an entirely new dimension: a fledgling business model that uses the quick-serve platform to get better-for-you fare into the mouths of more willing consumers.

At the same time, not to be outdone, traditional fast-food chains are tacking heavily into more nutritional fare after several years of more or less playing at it. Taco Bell, for instance, has just announced its strategy to offer healthier menu options, while McDonald’s is veering more deeply into wraps.

LYFE Kitchen is probably the best known of the cluster of promising better-for-you startups which also includes Clover, Veggie Grill, Tender Greens and Native Foods Cafe. New York Times Magazine writer Mark Bittman chronicled some of what these brands are doing.

“After the success of companies like Whole Foods [and] Annie’s and Kashi, there’s now a market for a a fast-food chain that’s not only healthful itself, but vegetarian-friendly, sustainable and even humane,” he wrote. “And, this being fast food: cheap.[more]

Jefferies analyst Andy Barish agreed in Bittman’s piece: “It is significant, and I do believe it is coming from consumer desire to have choices and more balance,” he said. “And it’s not just the coasts anymore.”

Well, it’s still mainly the coasts. Though birthed in Chicago by former McDonald’s executives and with the help of Oprah Winfrey’s chefs, LYFE—for “Love Your Food Everyday”—mainly has been opening outlets in California. The chain also has begun a franchising push in an effort to reach 250 locations in the next five years, beginning in the Windy City. It’s also got 250 angel investors willing to bet on the concept.

LYFE’s menu includes dairy-free cookies, grass-fed beef, no item of more than 600 calories, and no butter, cream, white sugar, white flour, high-fructose corn syrup or trans fats, as the magazine described. The average check is $15—stratospheric for QSR fare—but you get what you pay for. LYFE relies on digital order-taking, GPS customer location, online ordering and mobile apps to process and prepare orders of its Gardein “beef tips” and “ancient grain” bowl as quickly as possible.

At Clover Food Lab, in Cambridge, Mass., staffers try to justify the “fast food” moniker by rushing the lunchtime crowd, taking orders on iPhones, scanning credit cards with Square and giving change from money belts, then retreat to the kitchens to quickly whip up the restaurant’s locally sourced, organic, vegetarian fare from scratch, USA Today reported. The menu changes daily. The brand name presumably is homage to the quick-thinking students at nearby MIT and Harvard.

“People have all sorts of negative associations with fast food, but there’s lots of good things about fast food, too,” Clover founder Ayr Muir told the newspaper. “There’s a reason we eat so much of it as a country.”

The major fast-food chains couldn’t agree more. In fact, the current struggle to squeeze better results from their stores, necessitated in large part by continuing economic headwinds in the US, is another reason for the traditional powers to accelerate their move into better-for-you fare that can attract new demographics and fatter margins.

At this point, American consumers are also giving the venerable names in the QSR business some significant credit for trying to be more health-conscious. With the rollout of McWrap at McDonald’s and Flatbread Grilled Chicken at Wendy’s, for instance, the two chains have improved their brand perceptions among health-conscious consumers, according to a new YouGov BrandIndex report mentioned in Nation’s Restaurant News.

All of this adds up to reasons to expect more better-for-you fare from the McDonald’s of the world as well as Clover, LYFE and what is likely to be a growing roster of other health-oriented QSR startups.

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