00:00Joining us now is Bloomberg restaurant reporter Daniela Sattori.
00:03All right, how do we say the name of this?
00:05Why is it everywhere?
00:06And is there anything left that I can eat?
00:08Because it seems like all of my food is coming for me.
00:12All right, cyclospora, the parasite, cyclosporiasis, the disease.
00:15There we go.
00:16Okay, thank you.
00:17Thank you very much.
00:17There we go, yes.
00:19And definitely, you know, Michigan actually, you know, as you guys were saying,
00:23told people that lettuce is fine now after warning people to stay off.
00:28Salad mixes because of this parasite, which has infected tons of people in the state.
00:36And the interesting part of this is that the rate of infections has been just so much higher than in
00:41prior years.
00:42I mean, it's a seasonal type of parasite.
00:44People eat more salads in the summer.
00:46It's hot out.
00:47But this year, it's just been off the charts, basically.
00:51Daniela, walk us through the way this has become kind of manifest in the bottom lines of a lot of
00:56these restaurants.
00:57You reported on Sweetgreen, the salad chain, which I should note, has not been having any difficulties whatsoever with this
01:02particular parasite,
01:03but is feeling the knock-on effects of this.
01:05Talk a bit more about that, just kind of like how this parasite existing in some of our guts,
01:12but mostly in our psyches, is affecting the way that people are buying food, going to restaurants right now.
01:18Absolutely. So, you know, since the cyclospora outbreak, basically Americans all over the country have been really spooked to eat
01:25anything with lettuce.
01:27The interesting part is that the outbreak, you know, it is large, but it was only related to iceberg lettuce
01:33provided by a supplier called Taylor Farms,
01:36sold in restaurants like Taco Bell.
01:39It did go to other, you know, retailers like Walmart.
01:42So it did have a broad reach, but it was only iceberg lettuce.
01:46Sweetgreen doesn't even sell iceberg lettuce, but it was just a chilling effect that this parasite had that basically made
01:52people pull back from anything that was basically heavy on leafy greens.
01:57And so Sweetgreen was already struggling because of its own missteps.
02:02The company has admitted that its prices were too high, that perhaps its offerings weren't really resonating with people.
02:08And so it was already on a turnaround plan.
02:10And then this parasite comes along and basically it forced the company to cut its annual outlook even more.
02:17So previously they expected that sales at their established restaurants were going to fall by about 4%, as much as
02:234%.
02:23Now they expect as much as 8%, simply because of the fact that people are scared of lettuce, basically.
02:30And, you know, it's also worth it to note, it's not just that Sweetgreen's supply chain hasn't been hit by
02:35this.
02:35They don't even sell serif iceberg lettuce.
02:38I should say they do not.
02:39It's arugula and other spring mixes that I get when I go to Sweetgreen.
02:42I also did just look up if there is a DSM-specific order for fear of lettuce.
02:46There is not, although there might be after this.
02:49That's good.
02:52It's not just lettuce.
02:53You know, now we've got this potential salmonella outbreak.
02:56It's tied 27 illness clusters have been reported at Chipotle and Qdoba locations in seven states, likely somewhere in the
03:03ingredient mix of jalapenos, red onions, cilantro, avocado.
03:07Bon Appetit has an article out right now called American Food Safety is in its Flop Era.
03:12Is this going to put a bigger burden on the private sector to self-police if, you know, if the
03:17government isn't doing it, but it is going to start impacting their bottom line?
03:21So it's interesting to see the sequence of events here.
03:24So even for a company like Chipotle, which has pretty advanced systems that allow it to know where basically everything
03:31in its supply chain has been, right?
03:33So when the company found that the jalapenos that they use for the guacamole could be, you know, tainted with
03:39the salmonella,
03:40they have this system where they can go in and like pretty quickly pinpoint where this ingredient has been, who
03:46the supplier is, and all of that.
03:48So I would say that in that regard, a lot of companies have definitely come quite far when it comes
03:53to being able to really understand their supply chains.
03:58But, you know, the order of events still is that a state, for example, in this case, it was Minnesota,
04:03has to tell the company that they're seeing illnesses, right?
04:06And so it does matter, you know, when states such as Minnesota have a functioning system, like a functioning unit
04:14that tracks, you know, foodborne illnesses there.
04:18We should say that as of now, you know, this outbreak with salmonella has been tied to jalapenos from a
04:25specific supplier.
04:25There have already been recalls in place and restaurants such as Chipotle and Qdoba as well actually removed the ingredient
04:33from their restaurants before the information even became public.
04:37So actually Bloomberg News was first to report this on Monday, on August 4th, that Chipotle was linked to this
04:42outbreak.
04:43And by then, the health hangers were already out of the restaurants.
04:46And so basically the health authorities have come out and said, look, like because these restaurants were able to act
04:52pretty quickly, we don't think that there's like an ongoing rest.
04:55Like they're not really telling people to stay away from restaurants.
04:59Unlike with the cyclosporia outbreak, you know, in the early days with Taco Bell, some of the federal health authorities
05:05actually did come out and say, hey, guys, don't eat this lettuce at Taco Bell in these particular states.
05:11Danielle, great to speak with you.
05:12Danielle Sturitori joining us this morning.
05:15Cyclosporiasis.
05:15Say it one more time for me.
05:18Cyclosporiasis.
05:18There we go.
05:19I'm going to say it five times during this next commercial break.
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