Page 286 - Onboarding May 2017

With a similar buying strategy on poultry, we entered 2015 with fixed price program increases of nearly 5% after a strong performance
in 2014 in what were very volatile chicken markets. Through 2015, chicken supply increased more than forecast, export activity
decreased, and markets (PPI) ended down by less than .5%.

While we believe that the general strategy of stable forward pricing provides protection to our Members’ P&L’s and is appropriate in an
inflationary environment, clearly the deflation we experienced in 2015 created an underperformance versus the marketplace. We do
evaluate market-based alternatives to fixed price strategies on a product by product basis and endeavor to select those that provide
the best value to our Members, balancing predictability of your food cost and lowest cost.

Seafood, Pork, Dairy, and
Development of
Oils Categories Favorable additional shrimp
in 2015 suppliers and opportune

These markets all experienced declines in 2015, and we were able to follow forward contracts
them down. Development of additional shrimp suppliers and opportune forward on pork enabled us
contracts on pork enabled us to outperform those markets even though they were to outperform those
deflationary. markets even though
they were deflationary.

Furniture, Fixtures, & Equipment (FF&E)

We continue to support the Applebee’s Design Team, supporting Connections II, Bar Remodel, and the Modern Bar & Grill prototype. As
next generation elements are being designed, we continue to support sourcing and value engineering of the design elements being
developed by Applebee’s. Our work on a variety of existing and new elements, ranging from chairs/bar stools, tables, vinyl, paint, and
signage, resulted in savings to the Applebee’s system of over $1.5M in 2015.

Services

We continue to grow our Services offering, adding POS Hardware Service as a new category in 2015. Over 1,700 Applebee’s
restaurants joined a services program managed by CSCS last year - we now offer approximately 23 programs and have nearly 30,000
restaurant/service combinations in use amongst the Brands we service. CSCS’s Services category is now at $51M per year spend.
We invite you to look at the programs CSCS makes available to our Members. Service programs and FF&E offerings are listed on your
Member website at www.CSCScoop.com.

Hand Cut Wood Fired Program (HCWF)

CSCS spent considerable resources in 2015 assisting Applebee’s in the development and testing of the HCWF platform. Our work on
grills resulted in the understanding that the new Wood-Assist Grill efficiency was so superior to existing grills that an improved ROI
lowered the hurdle on this capital investment. We went into a very fragmented, immature marketplace for cut wood and brought
with us the most significant foodservice demand that marketplace has seen. Working with existing suppliers and developing new
suppliers, we were able to guide Applebee’s to a specification and requirements the marketplace could supply at significantly lower
cost than originally designed. Additionally, we assisted in the development of steak and protein options our Supply Chain could
manage and support in very short time frames.

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