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Fast-casual restaurants inspire competitors

New Technomic study finds the segment’s service, menus and décor driving change industrywide

Fast-casual restaurants represent only about 6 percent of all eateries, but their growth is outpacing other segments and inspiring new menu, service and décor innovations across foodservice, a new Technomic report finds.

The distinctions between fast casual and other segments are beginning to blur, the industry research firm said, as quick-service and full-service brands adopt many features and price points that have fueled the growth of such chains as Panera Bread and Chipotle Mexican Grill.

“Watching the success of fast-casual concepts, quick-service restaurants have adapted by improving menu items and adding fresh positioning,” Darren Tristano, executive vice president of Chicago-based Technomic, wrote in an email to Nation’s Restaurant News. “Leading QSRs, like McDonald’s and Wendy’s, are upgrading to fast-casual-like décor, and Chick-fil-A is testing table delivery.”

Casual-dining and family-dining brands also are adopting fast-casual elements, sometimes in new restaurant concepts, such as Pizza Inn’s recently launched Pie Five Pizza Co. and Denny’s new variant Denny’s Fresh Express.

Bagger Dave’s Legendary Burger Tavern, a five-unit full-service brand in Michigan, has adopted create-your-own and specialty burgers at price points similar to Five Guys Burgers and Fries and The Counter, but differentiates itself with a waitstaff that serves tableside.

Flat Out Crazy Restaurant Group’s forthcoming SC Asian unit in San Francisco begins with a fast-casual experience, with guests ordering and paying at a cash register, and then enlists waitstaff to serve guests, as Bagger Dave’s does.

Even with other segments appropriating its service elements, fast casual continues to push forward, Tristano said.

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“Innovative fast-casual concepts continue to evolve, adding full-service elements like table service in the evening and quick-service convenience like drive-thrus and delivery, defying the typical fast-casual definition,” he said.

Mama Fu’s Asian House, a 13-unit chain based in Austin, Texas, is one such brand that has moved toward a “flex casual” model. It operates as a typical fast-casual brand by day and adds full service for dinner.

Several sub-segments of fast casual in particular are growing rapidly, including bakery-café and “better burger.” An earlier “Consumer Trends Report” from Technomic found that the bakery-café segment, led by Panera, has seen total sales increase 12 percent and unit counts rise 4.2 percent in the past three years.

Quickly-growing burger purveyors, like Smashburger, Five Guys and Mooyah Burgers & Fries, now account for more than half of the top 75 limited-service burger chains in the United States, Technomic found.

Overall, the segment is performing strongly when it comes to popularity among consumers and sales growth compared with others in the foodservice industry, Technomic said.

The sector has outpaced both quick service and full service in terms of overall sales growth over the past decade, with recent growth rates between 4 percent and 5 percent, Tristano said.

Technomic expects the fast-casual sector to continue growing through 2020, and the firm’s newly launched Fast Casual Insights Group will provide ongoing data and forecasts about the segment, following its Foodservice Planning Program scheduled to be presented in January.

Contact Mark Brandau at [email protected].
Follow him on Twitter: @Mark_from_NRN

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