Bidding war in works for Six Continents

(Dow Jones/AP) -- British entrepreneur Hugh Osmond is planning to offer $9 billion for Six Continents PLC, the parent of the Holiday Inn and Inter-Continental hotel chains, while two U.S. buyout firms may join forces for a rival $12.6 billion bid, press reports said Sunday.

Further reports said Hilton Group PLC is drawing up plans to launch a "white knight" bid for Six Continents, which also the Crown Plaza hotel brand and more than 2000 pubs.

Citing anonymous sources, The Independent on Sunday said Osmond, who made his fortune in the restaurant business, will make a formal $9 billion offer for Six Continents on Thursday or Friday.

The newspaper said the offer will be made up of a mixture of cash and shares and is expected to be around $10.26 a share. American Depositary Shares of Six Continents closed Friday at $9.97 on the New York Stock Exchange.

The Independent on Sunday said Six Continents' chairman, Sir Ian Prosser, will almost certainly reject the offer. Spokespeople for Osmond's investment vehicle, Capital Management & Investment PLC, declined to comment on the reports.

The Observer said a takeover battle is set to erupt over Six Continents, as U.S. buyout firms Kohlberg Kravis Roberts & Co. and Blackstone Group team up for a possible $12.6 billion bid for the company. The newspaper did not name its sources.

Spokespeople for KKR and Blackstone couldn't be reached for comment.

The Sunday Telegraph, citing anonymous sources, said the Hilton Group is planning a bid for Six Continents. It said a combination of the two hotel companies would create a hotels worth $12.6 billion at the companies' current values.

No spokesperson for the Hilton Group was available for comment.

The Financial Mail on Sunday reported that Six Continents is ready to abandon its plans to split its hotels and pubs businesses and postpone an extraordinary general meeting March 12. The newspaper cited advisers to Six Continents.

A Six Continents spokeswoman declined to comment Sunday on "speculation," and said the division of the businesses is "on track."

European Hotel Financing Service  -  HVS and INVESCO Real Estate Advisers form new hotel financing advisory service

HVS International and INVESCO Real Estate Advisers have joined forces to create a specialist financing advisory unit for European hotels. Known as European Hotel Financing Services (EHFS), this alliance is the first in Europe dedicated to raising finance for hotels. 

The service is aimed at hotel owners, investors and developers seeking to finance both individual hotels and portfolios of hotels. The alliance will act on their behalf to secure the optimal financing solution for any given situation.

The service brings together the specialist expertise of HVS International and INVESCO Real Estate Advisers to provide a true one-stop shop for arranging hotel financing . 

HVS International is recognised as a leading global hotel consulting firm. INVESCO Real Estate Advisers is a real estate fund manager, which also provides independent, corporate finance and real estate finance advice to the hotel, leisure and real estate sector.

The venture will be spearheaded on the HVS side by Charles Human, Managing Director of HVS Investment Services, and on the INVESCO Real Estate Advisers’ side by Dennis Twining and Jochen Schaefer-Suren. Charles has been at HVS for nine years, prior to which he was an Associate Director at DTZ. Both Dennis and Jochen were formerly at Lazard, where Dennis established the general real estate group within corporate finance with Jochen focusing on the hotel sector. In his previous career Jochen held senior positions in hotel development with Meridien, Hilton and Forte. INVESCO Real Estate Advisers has an exceptional track record in the arrangement of debt and equity capital for hotel, leisure and real estate projects and companies.

Commenting on this strategic move, Charles Human, Director of HVS International noted “In what is a complex market, we believe that currently there are no dedicated independent hotel financing advisory alliances practicing on a pan-European basis which have both in depth hotel sector experience and a full understanding of the capital markets. By combining the unique skill sets of our firms we are able to fill this niche, and provide true added-value assistance to hotel owners in negotiating financing packages.” Dennis Twining, Director of INVESCO Real Estate Advisers added “Given our complimentary  expertise, we are in a position to arrange creative financing solutions which may be new concepts to many hotel owners.” 

For more information please contact:

Dennis Twining/Jochen Schaefer-Suren
INVESCO Real Estate Advisers
10 Mount Row
London W1K 3SD
Tel:  44 (0)20 7543 3500
Jochen_Schaefer-suren@ldn.invesco.com
Dennis_Twining@ldn.invesco.com

Charles Human
HVS International
14 Hallam Street
London W1W 6JG
Tel:  44 (0)20 7878 7702
chuman@hvsinternational.com

Philippines’ January arrivals up: Americans top list

TTG Asia  -  Despite fears of an outbreak of a US war against Iraq and reports on terrorism, the Philippines still experienced a continuous growth in tourist arrivals, marking a double-digit increase of 13.2 per cent in the month of January. The increase was the difference of the 175,728 tourist arrivals in January 2003 compared to 155,294 visitors in January 2002 when it yielded a 7.1 per cent negative growth rate.

Department of Tourism (DoT) Research and Statistics Office reported that tourist arrivals soared last year during the months of May with a 10.4 per cent growth rate; June, 10.0 per cent; July, 10.6 per cent; September, 15.2 per cent October, 36.3 per cent; November, 22.7 per cent; and December, 14.9 per cent.

Despite the US threat to launch a war with Iraq, more Americans visited the country making it the highest contributor of tourists in January 2003 with 36,852 and slightly higher than last year’s 33,521. The Korean market ranked second in tourist arrivals with 32,782 followed by Japan, 30,762; Hong Kong, 10,666 and Taiwan with 8,727.

In terms of growth rate, the Chinese market obtained the highest increase in January with 33.3 per cent. The upsurge was brought by groups of Chinese who celebrated the Chinese New Year with their relatives. Likewise, more Chinese came to the country to experience the Wealth of Wonder (WOW) tour packages, specifically the “More Than The Usual” shopping tour packages offered during the Grand Fiesta Sale in time for the Visit Philippines 2003 celebration.

Meanwhile, overseas Filipinos on homecoming visits doubled to 7,774 in January 2003 from 3,470 in January 2002. The increase was the result of DoT secretary Mr Richard Gordon’s intensified promotional campaign of Visit Philippines 2003 during his roadshow and sales missions in the US, Europe and Asia last year. He is optimistic about reaching the targeted 2.4 million tourist arrivals figures for this year.

Exhibitions Are a Key Factor in Marketing Strategies

Exhibitions  are being seen increasingly as an integral part of business marketing strategies. "There are some things you just can't dotcom," says Douglas Dugate, head of the US Centre for Exhibition Research. "Exhibitions deliver human interaction more cost- effectively than any marketing medium."

Major venues in SA are the Sandton Convention Centre, the International Convention Centre in Durban, Gallagher Estate in Midrand and the Expo Centre at Nasrec in Johannesburg. Another major venue, the Cape Town International Convention Centre, opens within the next few months. Deon Viljoen, chairman of the Exhibition Association of Southern Africa, says organizers are looking at venues with the most advanced facilities and equipment. Delegates and visitors are increasingly demanding only the best.

For exhibition organizers, for example, it goes beyond the importance of buyers being able to meet suppliers face to face. "They want to make sure that manufacturers and distributors have the latest display facilities and hi-tech equipment for the best possible presentation of their products." Viljoen says that comfort and convenience are essential to attract people to exhibitions, conferences and special events. Lynn Chamier, general manager of Reed Exhibitions, says it is imperative for exhibition organisers to reach the correct target market. Next month the Sandton Convention Centre will present Hostex, an international hospitality and catering exhibition. It is a business-to-business trade exhibition, showcasing leading manufacturers and suppliers of equipment, products and services.

Future events at the Sandton Convention Centre include the 2004 convention of the International Federation of Women in Travel Organizations, an influential organization in the travel industry, and the 18th World Petroleum Congress in 2005.

Raffles expects flat performance, not on ‘buying spree’

TTG Asia   -  Raffles  Holdings expects the group’s 2003 performance to remain flat compared to 2002, in line with the global economic and industry trends.

It presented the outlook to the media and analysts during the group’s recent results briefing.

Far from embarking on a “buying spree”, as reported, the group will continue to push topline and cost containment initiatives in a bid to improve margins.

Raffles is sticking to its strategy of continuing to seek selective growth in key regions through fee-based income from management contracts, with no or sliver equity involvement. North Asia remains its number one priority.

Canadian Tourism Industry Experiences Modest Growth in 2002  

e-Turbo.com  -  The total number of tourists travelling to Canada increased for the sixth straight month in December 2002, fuelled primarily by positive numbers from the United States, Asia and our primary markets in Europe. Results published by Statistics Canada indicate that the total seasonally unadjusted international overnight travel to Canada increased by 4.7% in December 2002, compared to December 2001. The year 2002 ended on a positive note with total numbers up 1.8% over the same period in 2001.

The total number of U.S. tourists coming to Canada was up 3.8 % in December 2002. Additionally, the positive trend in the numbers of U.S. tourists entering Canada by automobile continued in December 2002, and was up 7.3% for the year. "These numbers are a positive respite for the Canadian tourism industry," said Doug Fyfe, President and CEO of the CTC. "2002 saw the Canadian Tourism Commission and its partners step up their marketing efforts to help mitigate the impact of the events of September 11, 2001 on Canadian tourism. Although we should take pride in our success, we cannot rest on our laurels and must continue to seek out new and innovative ways to promote tourism to Canada, while planning for the potential impact of current overseas geo-political events on our industry."

In December 2002, overseas overnight travel to Canada was up 7.8%. For the year, however, the number of overseas overnight travellers was down by 5.3%. The countries registering the most important positive growth for Canada during the month of December 2002 were Italy (37.5%), Mexico (28.3%), Australia (22.5%), Japan (16.6%), The Netherlands (7.4%), France (4.6%) and the United Kingdom (2.0%). The number of Canadian tourists travelling to the U.S. or overseas was up 15.1% at 1.2 million in December 2002, and down 3.8% to 17.7 million for the year compared to the same period in 2001.

Industry led, market driven and research based, the Canadian Tourism Commission is a Crown corporation that works in partnership with the tourism industry and provincial and territorial governments to market Canada as a four- season destination

Emirates Towers Hotel voted Best Hotel in the Middle East

AME Info  -  For the second consecutive year, Emirates Towers Hotel, part of Jumeirah International, the Dubai based luxury hospitality group, has received the award for 'Best Hotel in the Middle East' during the Business Traveller Germany awards ceremony held in Frankfurt, Germany

The Business Traveller Germany awards were presented at a lunch reception that brought together the international hospitality industry. Awards were given to companies that were selected as the best hotels for business travellers in different regions by over 3,000 readers of the German edition of Business Traveller. It is the second consecutive year that Emirates Towers Hotel was acknowledged by readers of Business Traveller Germany for being their preferred hotel in the Middle East.

The award-winning Emirates Towers Hotel, a landmark in Dubai and dominating the skyline since its completion almost three years ago, is strategically located in the central business district of Dubai, next to the World Trade Centre on Sheikh Zayed Road, and adjacent to the Trade Centre Exhibition Halls.

The 400 – room hotel is, at 305 metres high, the third tallest hotel in the world while the adjacent Office Tower is the tallest building in the Middle East at 350 metres. The 51-storey towers, connected by the Emirates Towers Shopping Boulevard, are a dramatic backdrop to Dubai's central business district and a highly visible statement of the region's corporate success.

Since its opening in April 2000, Emirates Towers Hotel has won many prestigious international travel & tourism awards including ‘Best New Business Hotel in the World' by Business Traveller Magazine UK, ‘Best Business Hotel in the Middle East', by Business Traveller Magazine Middle East, ‘Business Hotel of the Year 200', by the DEPA Middle East Hotel Awards, ‘Middle East Business Hotel of the Year' during the MEED Awards for Business Excellence in 2002 and Emirates Towers Hotel was voted the ‘World's Leading Business Hotel' during the World Travel Awards in 2001.

Easily accessible and just 15 minutes from Dubai International Airport, Emirates Towers Hotel is designed for the modern business community. The property has proved to be one of the leading corporate hotels in the world during its first two years of operation.

World-class facilities include 14 restaurants, bars and lounges each with a distinctive décor and atmosphere, a 24-hour health club with fully equipped gymnasium, sauna, steam bath, massage room and an outdoor swimming pool. In addition the hotel offers an around-the-clock business centre providing complete secretarial services and extensive conference and meeting facilities with 25 boardroom-style function rooms, a 2200 sqm ballroom and pre-function area as well as a garden events area that can seat 3000 guests in comfort.

Jumeirah International properties are regarded as among the most luxurious and innovative in the world and have won numerous international travel and design awards. The group encompasses the world-renowned Burj Al Arab that has become a true icon and landmark for Dubai, the award winning Jumeirah Beach Hotel, Emirates Towers Hotel, Offices and Shopping Boulevard, The Jumeirah Beach Club, The World Trade Centre Hotel Dubai and Wild Wadi water park. In addition, the group opened The Emirates Academy of Hospitality Management in summer 2001.

Jumeirah International has expanded outside the Middle East into London, taking over the management of The Carlton Tower and The Lowndes Hotel in London's Belgravia last December. Following on from Jumeirah International's move into the UK, The Carlton Tower was immediately included in the prestigious ‘Leading Hotels of the World' handbook following Burj Al Arab, Emirates Towers Hotel and The Jumeirah Beach Hotel.

The company's latest expansion is the unique resort development Madinat Jumeirah. Enhancing Dubai's reputation as one of the world's most idyllic destinations, the 100-acre resort will offer the ultimate Arabian experience against the setting of a highly luxurious, world-class, multi-facility resort. Madinat Jumeirah will include two 300 room five star hotels and clusters of 340 rooms and suites all featuring authentic architecture reflecting the heritage and culture of Dubai and the Arabian region. The first phase of the resort is scheduled to open in September 2003 followed by the second phase in autumn 2004.

Website:   www.jumeirahinternational.com   

American Travelers Seek More Personalized Service With Online Travel Arrangements

e-Turbo.com   -  According to a recent research survey conducted on behalf of OctopusTravel.com by NFO Plog's On-TRAK Poll, which sampled 500 leading edge travelers (defined as frequent travelers who are internet users), three quarters (74%) of American travelers want more personal service from travel web sites. When faced with travel web sites currently available, most travelers identified at least one disadvantage to booking travel online, among which include "no personal, professional assistance when I need it," "no expert advice," and "no one available to deal with tourism problems."

The survey also revealed that online booking is prevalent, with nine in 10 travelers having booked a leisure or business trip online in the last year. Among all of these travelers, almost all (91%) would prefer to book hotel reservations and travel services from worldwide travel experts who can assist them any time of day from anywhere in the world (if rates are comparable).

Additional survey findings include the existence of a generation gap -younger travelers prefer to book travel online versus older travelers (77% of travelers between the ages of 18 and 34 versus 50% of travelers aged 45 and older); hotel dissatisfaction- many travelers (65%) have been disappointed with their hotel accommodations upon arrival at least once; change of plans- almost one third of travelers had to change their vacation plans during a trip; reaching out- one in ten travelers have had a problem while traveling and did not know who to call; Lost luggage: more than half of travelers have had their luggage lost at least once; family travel- more than half of the travelers plan to travel with their spouses and 41% plan to travel with their family; where they travel to more- than nine out of ten travelers intend to travel within the United States in 2003 and almost half plan to travel to Europe.

Taiwan: Tourism Bureau aims to bring 3 mil. visitors to Taiwan this year

China Post  -  Tourism has traditionally been an important part of a country's economy. That's why the government-initiated Challenge 2008 National Development Project calls for doubling the number of tourist arrivals by the year 2008.

The fulfillment of that goal will have to depend on aggressive overseas promotions and improvements to be made in the various tourist facilities here in Taiwan, said C. T. Su, director general of the Tourism Bureau under the Ministry of Transportation and Communications.

"Although Taiwan is small, there's a plenty to be seen," said the country's tourism chief. "There are tourist attractions for people looking for different things. There are scenic sites, there are historical sites, and there are cultural sites."

According to Su, the Tourism Bureau has set an annual tourist target through 2008, during which the island will see five million visitors — a number that doubles the tourist arrivals recorded at the time the national development project was proposed — if the plan is carried out successfully.

Last year, Su said there were about 2.72 million visitors coming to Taiwan. The Japanese still accounted for most of the tourists, with approximately 980,000 coming to Taiwan to visit some of the tourist attractions such as the National Palace Museum, the Alishan Mountain and the Taroko National Park that are already famous to them.

"Japanese youths also liked night markets, and the mountain town of Jiufen, where the movie 'Saddened City' known to many Japanese people was filmed," he said.

Meanwhile, Taiwan saw some 430,000 tourists from Hong Kong, Su noted. There were few Korean visitors coming to Taiwan last year due to a suspension of air agreements between airlines operators of both countries, Su said. Cathay Pacific and Thai were the only two airlines with direct services between Taiwan and South Korea.

This year, Su said, the suspended airlines services would partially resume with the operations of chartered flights. That, with a policy allowing Korean travelers to enter Taiwan visa-free for 14 days, would help increase the number of visitors from Korea, Su said.

The government has also announced plans to allow visitors from Hong Kong, Thailand, the Philippines and the United Sates to travel in Taiwan with either no visa or visa-upon-arrival, he said, adding his office also plans to bring to Taiwan more young ABCs (America-born Chinese) and Taiwan youths who have spent a long time in the States to increase visitors from America.

All these are part of the Tourism Bureau's plan to bring in about 3 million tourists to the island this year, or a 10 percent increase from 2002, Su noted.

He said the bureau will launch more overseas campaigns, supported by the NT$700 million international promotion budget allocated by the government, to promote Taiwan as an ideal tourist destinations.

Specifically, Su said the Tourism Bureau will promote Taiwan as a must-visit destination if one would like to get an all-encompassing view of the Chinese culture.

"Taiwan completes a Chinese culture golden triangle, with the other two being mainland China and Hong Kong," Su stressed.

"Mainland China has the historical sites, such as the Forbidden City in Beijing. But we want to remind visitors that while the palatial structure is breathtaking, what used to be inside it are now mostly in our National Palace Museum," Su said.

"In addition," the tourism chief continued, "although mainland China has a multitude of famous shrines and temples, most of them do not invite worshippers. This is a sharp contrast with what Taiwan has to offer — nearly all our temples attract crowds of worshippers everyday. A temple without worshippers loses the its meanings."

Furthermore, Su said Taiwan offers a case study for democracy in Chinese communities in the Far East.

"After looking at the modified communist society in mainland China, and the remnants of colonial rule in Hong Kong, visitors should come to Taiwan and see the democratic society on this island," Su emphasized. "It'll be an interesting comparison."

Su said attracting more visitors to Taiwan cannot depend on promotional campaigns alone. The strengthening of the local tourist facilities is another task to be taken on by the Tourism Bureau to improve the country's travel environment.

Su said one of the most important jobs for the government in this regard is to make tourist facilities more internationalized.

He said the Tourism Bureau will work with local operators to hire more English-speaking information desk employees and put up more English signs at tourist spots, train stations and other facilities to accommodate foreign FIT travelers.

"We should not give them difficulties as they travel here in Taiwan, for example when they can't get train information or other types of information," he said. "We must establish a system by which English is seen more at these types of facilities."

He added his office will also work with hotels and restaurants at the country's tourist attractions to enhance their services and facilities and lower their cost, for example down to NT$2,000 per night.

As for complaints that there are too many weekend tourists packing the country's various tourist attractions, Su said people might consider scheduling their travels during weekdays, citing a strong imbalance between weekday and weekend visits.

"These tourist destinations see little business from Monday to Friday," he said.

To lessen holiday crowds, the government is providing NT$16,000 in annual subsidies to civil servants to encourage them to take weekdays off and do their traveling, Su said, adding the Tourism Bureau is planning to add more scenic spots, national parks and forest walks to the existing ones.

Among the new places of interest to be developed under the plan are flower cultivation districts, a nationwide bicycling system and a southern branch of the National Palace Museum, he said.

"We've come up with a slogan, that people should 'think about tourism in their hearts,'" Su said.

"In the past, the government lacked the idea of making tourist destinations more international," he noted.

"But now, everyone in Taiwan should play a part in boosting the country's tourist industry. That means, everyone should greet foreigners with a smile and offer helps to them."

San Francisco Culinary Think Tank Translates  Trends into Tomorrow's Foods

Tucked just off San Francisco's bustling Embarcadero is a slightly mysterious private company with a powerful grip on determining what new foods we eat and purchase. 

At the Center for Culinary Development on Montgomery Street, the staff of 17 don't like to talk much about products being devised for supermarket shelves or fast-food menus. Or about ones that have flopped. Its consulting chefs are practically sworn to secrecy about their input. Its big-name corporate clients such as Heinz and Kraft decline to comment. And little has been written about the research and testing done there. 

In the ultra-competitive world of food manufacturing, where it takes multimillions of dollars to bring one new product to market, it pays to be stealthy. 

Founded in 1991, the Center for Culinary Development is a think-tank for hire with a roster of distinguished chefs who help translate today's trends into tomorrow's foods by developing products and concepts. 

If your wallet and taste buds have been tempted by Taco Bell Gorditas, Smart Ones Bistro Selections frozen entrees, RosaritaGreen Chile and Lime Refried Beans, Planters Sweet Roasts nuts, Dole Cosmic-Shaped Pineapple Chunks, Ore-Ida Hot Bites Tater Dogs, Dole "Restaurant Style " Salad Blends in a bag, Frito Lay's Hearty Combo dips and chips packages, or Ghirardelli Milk Chocolate Squares, you have the center to thank. If you've ever used recipes off the back of Kraft food packages or the McCormick Web site or certain coupon inserts, you've also utilized the center's handiwork. 

"We drive what America is eating," says Kimberly Egan, partner and director of client services for the center, which helped develop all those products. "Our clients are the people who feed America." 

They include Burger King, Del Monte, General Mills, Haagen-Dazs, Heinz, Hershey's, Keebler, Land O'Lakes, Maxwell House, McDonald's, Muir Glen, Ocean Spray, Peet's Coffee, Pillsbury, Procter & Gamble, Quaker, Sara Lee, Tyson, Wish Bone and more -- most based outside of California. 

Egan, a former marketing director for General Foods and ConAgra, and Marc Halperin, a graduate of Ecole de Cuisine La Varenne in Paris and former instructor at the California Culinary Academy in San Francisco, fused their expertise to create the center because they saw a need. 

Twelve years ago, Egan explains, the success rate for new food products was a dismal 5 percent. Manufacturers would come up with a new food item -- sometimes without a whole lot of study -- throw it out to the public and hope consumers would bite. Now that food developers and food researchers have gotten into the game, Egan says, the success rate for new food products in general has improved to about 10 percent. 

Moreover, a decade ago, it took on average at least two years for a company to introduce a new product, says Maggie Mah, executive vice president of Foster City's Mattson & Co., the largest independent food and beverage development group in the country, which was established in 1977. But with product development companies such as Mah's and Egan's, that time frame has been slashed in half. 

"We've helped change that," Mah says. "And the benefit to the consumer ultimately is that we bring better quality food to the table and the store, with more choices, more convenience." 

Although Egan declines to reveal the center's revenues, she says that even in these stagnant economic times, business has been more robust than last year. 

At the Center for Culinary Development, ideas for new products come up in a couple of ways. Sometimes, the center approaches manufacturers with a list of trends, forecast annually by the center's chef advisers, in hopes of sparking new products capitalizing on those new directions. For instance, the chefs might find tea particularly hot, so a manufacturer might consider infusing new beverages or chocolates with tea. 

More often than not, though, it is the manufacturer that calls upon the center to help create a new product aimed at a particular demographic group. For example, about five years ago, Kellogg's wanted to create a premium cereal aimed at consumers who were professionals, 30 years or older, and with a salary of $100,000 or more. 

The center came up with the idea of a cereal line modeled after the luxurious brunches offered at bed-and-breakfasts. Six chef advisers went to work on the recipes, including one who was, of all things, a salad expert. But as Halperin, the center's culinary director and principal, explains, it made perfect sense because both cereal and salad comprise lots of different things tossed in one bowl in harmony. 

Each chef created five cereal recipes, which were tasted and critiqued. Colors and shapes were dissected, striking features highlighted and ingredients scrutinized to assure they were affordable and easily available to the manufacturer. 

Prototypes then were created in the center's kitchen, which is part chemistry lab, with its intriguing vials of liquid flavoring agents such as "grape soda," "pie spice" and "blue lagoon" (a berry flavor). Why use "pie spice" liquid flavoring in a product rather than real ground nutmeg, cinnamon and cloves? Because it's cheaper and has a longer shelf life. 

Once the prototype cereals were created, Wharf Research, a subsidiary of the center, took over to find out what real people thought about them. The research arm is conveniently located at Pier 39, which gets 17 million visitors a year. It is a demographer's dream. No matter what the target audience for a product, Wharf Research can find the needed representatives there. Consumers, whisked to the center's offices by private van, are paid $100 for about 90 minutes of tasting and feedback on the products. The information leads to further tweaking of the items, or even sometimes, in completely new products. 

Although neither Egan or Halperin will discuss products that failed, they say their biggest frustration is when the manufacturer decides at the last minute not to go forward with the product, because priorities or finances have changed. With 20 to 30 projects in the works annually at the center, that worst-case scenario happens only about once a year. To make matters worse, in the world of competitive food manufacturing, a rival often will come out with a similar product later on that succeeds. 

At times, Egan likens the process to "giving birth and giving the child away," because after a product does come to fruition, the center has no control over pricing, advertising or distribution. 

In the case of the cereals, the price ended up being higher than most consumers wanted to pay -- a 10-ounce bag for $5. Three flavors of Country Inn Cereals were produced. Only one is still being made, a deluxe mix of premium nuts, spiced dried apples and even miniature palmier cookies (an idea from one of the center's chefs). 

The most unusual products the center helps conceive? Alcoholic beverages with unlikely flavorings or infusions, Egan and Halperin say. 

The most successful? Probably the Smart Ones Bistro Selections for Weight Watchers, which took the concept of healthy dishes with restaurant-style taste and grew into a host of product lines from frozen pizzas to frozen bowl meals. 

That's not exactly fare you'd imagine would be relished by top-rated chefs like Hubert Keller of San Francisco's Fleur de Lys, Gerald Hirigoyen of San Francisco's Fringale and Piperade, and Craig Stoll of San Francisco's Delfina. And that's the dichotomy: The center's elite group of 85 chefs and food experts, the majority of them based in the gourmet mecca of the Bay Area, are the ones influencing the development of convenience and fast-food products that they themselves would never use or eat. On one hand, their input resulted in sun-dried tomatoes cleverly incorporated into a no-salt crust to boost the flavor of Smart Ones Bistro Selections frozen pizza. On the other hand, their fine-tuning also helped create the much-maligned chocolate-flavored Ore-Ida Funky Fries. 

"It's a challenge," says San Francisco cookbook author Joyce Jue about the mass-marketed products she's worked on, which she declined to name because of the center's confidentiality agreements. 

Farina Wong Kingsley, an instructor of Asian cuisines at Tante Marie Cooking School in San Francisco, says she's proud of the products she's helped create, even if the vibrant flavors in her original recipes often end up severely muted to appeal to a broader national audience. 

"Good food is good food," she says. "Even with potato chips I've had input on, I'm glad that at least they end up good tasting, and not just junk." 

So who really determines what we eat and buy? Is it the consumer who wields the most power? Or the manufacturer? 

Egan says definitely the consumer. "Look at the increase in farmers markets across the country. It's driven by consumers' desires to know where food is coming from. Manufacturers didn't say, 'Let's create a category of pure, clean food.' No, it was driven by consumers." 

But Halperin is less certain. He points to two new products, disposable cutting boards and nonstick aluminum foil, neither of which the center worked on, and wonders if a market will actually emerge for them. 

Ehotelier.com is a proud sponsor of The Center for Hospitality Research