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2018 Top 200: Chicken comes first in market-share growth

Limited Service/Mexican, Beverage-Snack also post solid gains

This is part of the Nation’s Restaurant News annual Top 200 report, a proprietary ranking of the foodservice industry’s largest restaurant chains and parent companies.

The Chicken, Limited-Service/Mexican and Beverage-Snack segments gained the most market share this year within the Top 200.

Six of the 12 segments showed market-share growth, based on the categories’ aggregate sales as a percentage of all Top 200 sales in the Latest Year.

Results for the other Top 200 segments were a mixed bag, as five segments — Casual Dining, LSR/Burger, LSR/Sandwich, Family Dining and LSR/Specialty — saw their shares of aggregate sales dip. In-Store’s share of Latest-Year sales was flat.

The Chicken segment was the leader in market-share gains, adding more than 0.3 percentage points in the Latest Year, with strong performances that grew share from Atlanta-based Chick-fil-A, Dallas-based Wingstop and Plano, Texas-based Raising Cane’s Chicken Fingers.

“Chick-fil-A was firing on all cylinders,” said Alan Liddle, data and event content director for the NRN Restaurant and Food Group.

Privately held Chick-fil-A’s market share increased to 37.1 percent in the Latest Year, from 35.1 percent the Preceding Year, reflecting growing unit counts and Estimated Sales Per Unit. Chick-fil-A also moved up the Top 200’s U.S. systemwide sales ranking, overtaking Dunkin’ Donuts for the No. 7 spot.

In the Beverage-Snack segment, Seattle-based Starbucks Corp. continued its dominance in the Latest Year, growing its share of the category’s sales to 59.3 percent, from 58.6 percent the Preceding Year.

Part of Starbucks’ strong-as-a-double-shot performance was its digital innovation and loyalty program.

Kevin Johnson, Starbucks’ chairman and CEO, said in a first-quarter earnings call in January that the chain added 1.4 million active Starbucks Rewards members in the U.S., an 11-percent year-over-year increase, bringing the total up to 14.2 million active members.

“Mobile payment in the U.S. has grown to over 30 percent of total tender,” Johnson said. “The ubiquity of mobile and credit card payment is enabling us to begin an exploration of cashless stores in the U.S.”

The LSR/Mexican segment saw market-share gains on the back of a return to positive performance by Denver-based Chipotle Mexican Grill, which clawed its way back from sales declines after several foodborne illness outbreaks in 2015.

“During 2017, we have made considerable changes around leadership, operations and long-term planning, and it is clear that, while there is still work to be done, we are starting to see some success,” said Steve Ells, who said in December that he would step down as CEO. He was succeeded in February by Brian Niccol, formerly CEO of Taco Bell.

For the Latest Year, Chipotle gained market share within the LSR/Mexican segment, increasing share to 24.4 percent, from 22.7 percent the Preceding Year. Taco Bell remained the segment sales leader, even though its market share slipped to 54.3 percent in the Latest Year, from 55.4 percent the Preceding Year.

Segments that suffered the biggest losses in market share were Casual Dining, followed by LSR/Sandwich, which partially reflected the closure of Subway units in the Latest Year, Liddle said.

Milford, Conn.-based Subway, owned by Doctor’s Associates Inc., lost market share in the Latest Year, slipping to 49.6 percent, from 51.6 percent the Preceding Year. As franchisees closed domestic units, Subway saw its unit count fall 3.1 percent from the Preceding Year, which reflected the shuttering of more than 830 units in the Latest Year.

Casual Dining chain and segment sales were impacted by Latest- and Preceding-Year unit closures associated with the bankruptcies of Houston-based Ignite Restaurant Group Inc., parent to Joe’s Crab Shack; Nashville, Tenn.-based Logan’s Roadhouse; and Denver-based Romano’s Macaroni Grill. Maryville, Tenn.-based Ruby Tuesday Inc. also shed units before and after its sale to private-equity firm NRD Capital.

Read more: 
2018 Top 200: Market Share by Segment
2018 Top 100: 10 takeaways from market share trends
2018 Top 200: Market Share Trends

Contact Ron Ruggless at [email protected]

Follow him on Twitter: @RonRuggless

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