The Secret to Fast Casual’s Ongoing Success
The Secret to Fast Casual’s Ongoing Success
I know a fast-casual restaurant, a mixed creature of casual dining and fast food, is not new, especially for us millennials. After years of glowing coverage, the fast-casual seems to be rather dreary. The not-so-good service and lost controlled foods raised people’s doubt on how sustainable this business is and how long can it go? Is it the end of this model’s golden age?
My answer is, simply,
No. Food industry research firm Techomic Inc, in an advance copy of its annual
ranking of the country’s top 500 restaurant chains, said that while sales rose
an average of 4.9 percent for all the chains, the fast-casual segment soared
with a growth of 11.4 percent. [1]
People looking for quick, fresh, customizable dining options are only increasing today, anywhere from downtown NYC to rural Tennessee. Consumers are still drawn to this segment, but not all fast-casual chains equally. Based on my observation and research, restaurants that have a strong understanding of dining experience through the eyes of the consumer. There are three golden rules to the longevity.
The Perfect Food!
Dinner time, you may say no to a big Mac and a “detergenty” Diet Coke, but would you say no to a SmokeShack topped with all-natural Applewood bacon and a chocolate frozen custard? How about an even healthier steak salad with fresh guacamole? Think about the needs of customers today, we want to spend our money, time, and calories on something that’s ‘worth’ it.
The menu makes a fast-casual restaurant. Nearly 60% of visitors say the things they love most about fast casual are the food and menu. [2] Restaurants should offer fresh and low-processed food feature local farms and organic/ environmental responsibility. Majority of the people are not expecting Wagyu Caviar level of fancy ingredient that often, and freshness and higher level are exactly what they are looking for.
Even Stir-fry can be customized now
Besides the ingredients itself, fast-casuals are ought to be the pioneers in satisfying the curiosity of eaters’ appetite. They must be sensitive to trendiest and hit cuisines and always bring a refreshing twist to the picky tongue. New fast casuals continue to launch and expand all the time, from the numerous on-trend poke bowl brands to new concepts that focus on growing dayparts (breakfast) or differentiate themselves by specializing menu items or cuisines. [3] Higher food quality and menu variety are the keys here.
Fast, Fast, Speedy!
Let’s be completely honest: few people want to waste 1/14 hours of their sober time on waiting for food, at least I hate it. Remember I have four dues, three group projects, and one part-time job to do in the next 24 hours? Fast casual is my go-to place where I don't have the hassle and time to wait for a table, be seated, get waited on and pay extra money for a gratuity.
This is how fast-casuals stand out from the casual peers. Think about a classic Chipotle experience: you tell the very customized plate to a server and he hands you the plate in 1 minutes at the end of the line. A counter person greets you and finishes the whole process by 30 seconds fast-check. You don’t need the waiter to get the menu, food, water, and bill for you, as the process is streamlined and easy. No fuss service and fast delivery of the food cut the waiting time tremendously.
MOD Pizza's Open Kitchen
Customers really buy this effort. For example, MOD pizza really got it: by making pizza in an assembly-line style, it just takes 2-3 minutes for the craving eaters to have hot crispy pizzas from the kitchen to their hands. This format has led to 220 percent YOY growth in sales and made MOD the fastest growing pizza chain and the industry shaker. [4]
Location, Location, Location!
Not every available spot is right for a restaurant, especially fast casual one. What may look like the perfect spot- say a bustling pedestrian street in the heart of downtown- may turn out to be a dud. Because millennials count 25% of the US population and make up 51% of the fast-casual customers, it’s usually a good idea to follow the millennials.
The Den, for example, is essentially a fast-casual version of a Denny’s. It’s no accident that nearly all 17 locations of The Den are in or near colleges and they all open late. “Come in and see that this is not your dad’s diner”, the Den targets younger and busy population and thus located itself close to its targets. [6]
What’s next?
The new niche is taking market share from both the traditional quick-service chains and from casual dining.
Of the course, you need many other factors succeed in the competitive industry, such as careful financial planning and food hygiene for the sake of profitability, but I consider those factors to be universal and not particular for fast casual thus will not discuss here.
Now you have the crowd sitting in the restaurant. But how do you increase sales and year-over-year comps for the limited 40-50 seats? It’s through catering. Fast casuals should expand the catering business as much as possible and provide a dining experience far above its traditional averages. Think university and company meetings for example; if you are at a meeting and you get a lunch box where the box looks sharp and the food tastes amazing, it creates a positive mindset. This is a quality service that customers are dying to pay for. Fast-casuals, ready to expand into this field?
Citations:
1. Verdon, J. (2016). FAST-CASUAL EDGING OUT SIT-DOWN CHAINS. The Record, 7, 1-2
6. Klara, R. (2017, February 15) Why America’s Aging Casual-Dining Chains are quietly building fast-casual Restaurants. Retrieved September 24, 2017 from Adweek
The Secret to Fast Casual’s Ongoing Success
I know a fast-casual restaurant, a mixed creature of casual dining and fast food, is not new, especially for us millennials. After years of glowing coverage, the fast-casual seems to be rather dreary. The not-so-good service and lost controlled foods raised people’s doubt on how sustainable this business is and how long can it go? Is it the end of this model’s golden age?
My answer is, simply,
No. Food industry research firm Techomic Inc, in an advance copy of its annual
ranking of the country’s top 500 restaurant chains, said that while sales rose
an average of 4.9 percent for all the chains, the fast-casual segment soared
with a growth of 11.4 percent. [1]
People looking for quick, fresh, customizable dining options are only increasing today, anywhere from downtown NYC to rural Tennessee. Consumers are still drawn to this segment, but not all fast-casual chains equally. Based on my observation and research, restaurants that have a strong understanding of dining experience through the eyes of the consumer. There are three golden rules to the longevity.
The Perfect Food!
Dinner time, you may say no to a big Mac and a “detergenty” Diet Coke, but would you say no to a SmokeShack topped with all-natural Applewood bacon and a chocolate frozen custard? How about an even healthier steak salad with fresh guacamole? Think about the needs of customers today, we want to spend our money, time, and calories on something that’s ‘worth’ it.
The menu makes a fast-casual restaurant. Nearly 60% of visitors say the things they love most about fast casual are the food and menu. [2] Restaurants should offer fresh and low-processed food feature local farms and organic/ environmental responsibility. Majority of the people are not expecting Wagyu Caviar level of fancy ingredient that often, and freshness and higher level are exactly what they are looking for.
 |
| Even Stir-fry can be customized now |
Fast, Fast, Speedy!
This is how fast-casuals stand out from the casual peers. Think about a classic Chipotle experience: you tell the very customized plate to a server and he hands you the plate in 1 minutes at the end of the line. A counter person greets you and finishes the whole process by 30 seconds fast-check. You don’t need the waiter to get the menu, food, water, and bill for you, as the process is streamlined and easy. No fuss service and fast delivery of the food cut the waiting time tremendously.
|
| MOD Pizza's Open Kitchen |
Location, Location, Location!
As we’ve discussed two key opportunities attract customers to fast casual dining spots, the location decides your customer loyalty and customer traffic. Driving 20 minutes and producing extra CO2 sounds like a paradox to a fresh but fast meal. No matter the amount of marketing and advertising a concept is invested in, without visibility, foot traffic and proximity to large anchor businesses it’s almost impossible for people to decide with a lot of uncertainty. [5]
What’s next?
The new niche is taking market share from both the traditional quick-service chains and from casual dining.
The restaurant needs to integrate the service speed of quick-service restaurants with the food quality and prime locations of the casual-dining brand.
Of the course, you need many other factors succeed in the competitive industry, such as careful financial planning and food hygiene for the sake of profitability, but I consider those factors to be universal and not particular for fast casual thus will not discuss here.
Now you have the crowd sitting in the restaurant. But how do you increase sales and year-over-year comps for the limited 40-50 seats? It’s through catering. Fast casuals should expand the catering business as much as possible and provide a dining experience far above its traditional averages. Think university and company meetings for example; if you are at a meeting and you get a lunch box where the box looks sharp and the food tastes amazing, it creates a positive mindset. This is a quality service that customers are dying to pay for. Fast-casuals, ready to expand into this field?
Citations:
1. Verdon, J. (2016). FAST-CASUAL EDGING OUT SIT-DOWN CHAINS. The Record, 7, 1-2
2. Kostyo, M. (2017, September 13). What’s next for fast casuals? Retrieved September 28, 2017 from SmartBrief
3. Chessey, K. (2017, August 29) Better Than: The Secret to Fast Casual’s Ongoing Success Retrieved September 21, 2017 from Modern Restaurant Management
4. Chessey, K. (2017, August 29) Better Than: The Secret to Fast Casual’s Ongoing Success Retrieved September 21, 2017 from Modern Restaurant Management
5. Mealey, L. (2016, October 18) What to Consider Before Choosing a Restaurant Location? Retrieved September 28, 2017 from The Balance
6. Klara, R. (2017, February 15) Why America’s Aging Casual-Dining Chains are quietly building fast-casual Restaurants. Retrieved September 24, 2017 from Adweek
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