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Low-Carb Could Spell Next Fast-Food Fight

By Deborah Cohen

CHICAGO (Reuters) - Jeff Endervelt's interest in low-carbohydrate foods began as a personal quest when he experimented with the Atkins diet and spin-offs that helped him shed 20 pounds.

As chief executive of Atlanta-based Blimpie International Inc., Endervelt saw a market worth pursuing when his customers started asking for submarine sandwiches on something other than white bread.

A sandwich shop called Blimpie's might seem an unlikely destination for dieters. It is now also the only national restaurant operator testing a separate menu targeted at the low-carb, high-protein eating craze.

The Blimpie Carb Counter Menu, launched this month in parts of New York's Long Island, offers 6-inch subs with fillings like roast beef and cheddar with wasabi dressing on seven-grain bread. The sandwiches, each with only 7 to 8.5 net carb grams and lacking the white flour eschewed by low-carb adherents, can be paired with a SoBe drink and Crunchers chips from Atkins Nutritionals Inc.

While only a small minority of Americans are following low-carb, high-protein style diets, experts say interest is growing exponentially. Dedicated fare is cropping up in corner delis and unlikely spots like mass retailer Wal-Mart Stores Inc. . Last week H.J. Heinz Co. even introduced a low-carb ketchup made with less sugar.

"I didn't do a formal study, but I think I've known enough about the Atkins diet and the South Beach diet to know this is a wave that's coming," Endervelt told Reuters. "This is a diet that's been around for a long time. But it has caught on."

Endervelt expects to take his low-carb menu items into some 1,650 Blimpie stores nationally.

Similar experiments are turning up in California, a leader in eating trends. The private Irvine-based In-N-Out Burger caters to low-carb dieters with a bunless burger wrapped in lettuce.

Italian eatery Pasta Pomodoro Inc., another closely held West Coast chain, is selling a variety of dishes made with whole wheat or low-gluten, high-protein pastas. Wendy's International Inc., the No. 3 U.S. hamburger chain, owns 25 percent of the company.

"Every significant restaurant chain is deeply aware of the low-carb demand of its customers," said Dean Rotbart, executive editor of LowCarbiz, an Internet newsletter. But the trend is still in its infancy, he said, and bigger chains have been reluctant to join in.

Instead, in the face of rising U.S. obesity rates and threats of litigation blaming the food industry, big restaurant companies have focused on returning to more traditional health-oriented offerings such as the meal-size salads that have helped reverse McDonald's Corp.'s sagging U.S. sales in recent months.

And Blimpie's larger privately held rival Subway Restaurants has seen great success with the ad campaign featuring Jared Fogle, who said he lost 225 pounds on a steady diet of low-fat sandwiches.

UNTESTED WATERS

McDonald's, the largest restaurant company, this week tested the low-carb waters. It said it will help customers customize burgers and other foods on its fast-food menu within three dieting styles -- low fat, low calorie, and yes, low carb. The plan, dubbed "Real Life Choices," is being introduced in parts of the greater New York area in January.

The hesitation to roll out dedicated low-carb menu offerings may stem from concern about the safety of those diets. Many nutritionists still conform to the standard dietary guidelines outlined in the U.S. Department of Agriculture (news - web sites)'s food pyramid, whose base is carbohydrates. They question the stricter phases of diets like Atkins, which recommend ample quantities of protein in the form of red meat, butter and other fatty foods, in lieu of breads and starches.

"There are bits and pieces of truth in these high-protein, low-carb diets," said Samantha Heller, a nutritionist with New York University Medical Center. "It's very difficult for people to distill the difference between the truth and twist."

To date, only about 1 percent of the total U.S. population is following a low-carb diet, according to The NPD Group, a market research firm that tracks food trends.

Little research exists on the size of the market for low-carb foods. Matthew Wiant, chief marketing officer of Atkins Nutritionals Inc., estimates the amount of such products sold at retail, excluding restaurants, is roughly $2 billion, a tiny slice of America's food budget.

Wendy's, while a stakeholder in Pasta Pomodoro, said it has no immediate plans to introduce low-carb items into the menu at its mainstay stores.

"It's certainly a trend that we're well aware of," said company spokesman Bob Bertini.