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Fast-casual Boom Continues Through 2015 and Into 2016

Posted on April 11th, 2016

Fast Casual Boom Continues

As consumers’ eating habits continue evolving, the Top 500 largest restaurant chains reported growth of 4.9 percent in 2015, with total sales of $288 billion. According to data from Technomic Inc., this topped the 2014 growth rate of 4.2 percent.

Fast-casual models have been moving at the helm of the pack with an astonishingly 11.4 percent sales growth, almost doubling the growth of any other segment. Sales in the limited-service segment grew by 5.5 percent during the year, while full-service restaurants listed 3.4 percent growth.

“While the performance of the Top 500 chains showed moderate improvement over the prior year, consumers clearly favored patronage of fast-casual and fast-food restaurants,” said Darren Tristano, president of Technomic. “In full service, family style restaurants succeeded on affordable value; upscale casual dining chains appealed to more affluent consumers and many traditional casual dining chains appeared to be squeezed in the middle with weaker performance.”

McDonald’s returned sales growth of 1.1 percent in 2015, thanks in part to its new all-day breakfast menu. Starbucks had the strongest year of all the major companies with 12.8 percent growth. Taco Bell and Burger King also increased its sales growth by 8.2 and 4.2 percent respectively.

Overall, the industry giants saw their profits improve in 2015 along with the fast-casual segment.

The big names, like Panera Bread, Panda Express, and Jimmy John’s, achieved impressive sales at the top of the fast-casual segment. Fast-casual pizza chains, including Blaze Pizza, MOD Pizza, and Pieology Pizzeria, also saw success over the past year.

In the full-service segment, chains recorded a 3.5 percent overall increase in annual sales in 2015, holding steady at approximately the same growth rate observed in 2014. Steak-focused concepts, following a noteworthy year in 2014, were winners again; casual-dining steak concepts registered a 6.2 percent rise in sales while fine-dining steak concepts grew sales at a rate of 5.6 percent. Sports bar and wing-centric casual-dining concepts were high performers in 2015 as well.

The industry showed significant improvements in sales over the previous year, notably fast-casual and casual-dining segments. Moving forward, restaurants continue adapting to changes in consumer behavior and new technologies, such as food delivery services, to retain positive growth year-over-year.

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