I had the opportunity to travel throughout the States in November and December. I visited a lot of restaurants, seeing not only good things and good people but also operational issues that result in leaving dollars on the table. These are things that slice revenues and generate more expenses for a business.

Pacific Management Consulting has updated its 2010 private equity and restaurants report to identify what is going on in the U.S. restaurant space by private equity (PE) firm. The result? A lot of activity, investments, and some high profile failures. There have just been a modest number of apparent successes to date.

Even though it is clear that there is a global financial problem at hand, chain restaurants are reporting surprisingly strong results through early August, given poor consumer confidence.

Some restaurant franchisors are 100% franchised or nearly so; for example, Applebees, IHOP and Domino's. Other operators are headed in that direction. Most of the system business activity is off the books, since results with franchisees are not reported.

Attached is a well-written thought paper from Booz and Company, the global strategy consulting firm, on the state of and changes needed in the private equity (PE) space. Understanding private equity is so important now to the restaurant universe as so many large restaurant chains are owned by private equity firms.