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Starboard Value's nearly 300 page essay on turning around Olive Garden/Darden Restaurants
Activist investors with way too much time on their hands is one way to look at it. On the other hand, kind of a fascinating, book-length look at the mind of an activist investor's approach to a situation.
Every time I go to Olive Garden the place is full.
These activist hedge funds need to stay out of the way when it comes to everyday business. Next thing you know the all you can eat salad will end up being four pieces of lettuce, one tomato chopped and one each of olive and crouton. It's absurd.
BTW, I don't take credence in anyone who cannot spell or use proper grammar. Their presentation is full of wrongs.
@JohnChisum Maybe the place is full, but I saw a national ad this week that Olive Garden is offering a free entree when you buy one entree. I know that is not an original concept, but it is one used by very marginal businesses. While your wallet might appreciate this, it is pretty unlikely that you will have a stellar dining experience.
This promotion is actually discussed in the giant presentation as an example of what should be changed, as it doesn't reflect well on the quality of the food. One particularly interesting portion of the presentation is a section that shows what certain entrees look like on the menu and what the same entree looked like when served. What was actually served - not even close to what the menu picture looks like.
Edited to add: a focus on this aspect of the report -
I am at a disadvantage since I eat at OG once a year or so when I am stateside. I cannot disagree with eating at the mom and pop resto. The best food is there.
On a side note, in the closest big city to us they have a TGIFridays which is now part of the Sentinal and Tri Artisan group. It used to be under the Carlson group until it was bought out. Along with TGIF, the local franchise also brought in Italianni's and a Japanese restaurant. All three are under the same group. They built in these restaurants in the mall where they are located next to each other so they look like separate restaurants from the outside but they all cook their food from one central kitchen. A smart business plan for sure but from a customer standpoint it's a negative. What if they mix up the fettuccini and soba noodles?
Business is looking for things that look good on paper but maybe not so good for business.
Comments
These activist hedge funds need to stay out of the way when it comes to everyday business. Next thing you know the all you can eat salad will end up being four pieces of lettuce, one tomato chopped and one each of olive and crouton. It's absurd.
BTW, I don't take credence in anyone who cannot spell or use proper grammar. Their presentation is full of wrongs.
Edited to add: a focus on this aspect of the report -
http://www.businessinsider.com/olive-garden-food-vs-reality-2014-9
Business is looking for things that look good on paper but maybe not so good for business.