What Operators Can Learn From the Top Restaurant Chains
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“Why is eating out so expensive now?”
That’s a question millions of consumers are asking. And they’re not wrong — in the United States, the price of quick-service meals and snacks rose nearly 28% from 2019 to 2023. (Full-service restaurants saw a 24% price jump). In early 2024, the average quick-service check was $18, 4.5% more than last year.
Customers are also complaining about food delivery costs, which have been increasing because of new minimum wage laws in Seattle and New York City plus new fees tacked on by the delivery companies. All of this adds up to a tough environment for chain restaurants… yet many chains are not only surviving but thriving. What takeaways can we learn from their success?
For younger generations, beverages are king.
What are the top three favorite limited-service restaurants in the U.S.? Not the sandwich or burger spots you might expect. They’re Dutch Bros (a hip, playful coffee chain), Tropical Smoothie Café, and Smoothie King, according to the most recent Technomic survey.
“Smoothies are cold, sweet, and fruity; those three things are always going to win the hearts of young consumers,” said Robert Byrne, director of consumer and industry insights for Technomic. “So, it's all these things, it's in a cup, it’s functional, it has the flavor profiles that you want, and also tends to come at a price point that is a lot more palatable than your $16 Big Mac meal.”
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Pick one to provide: convenience or experience.
High restaurant prices mean customers are asking themselves: “Why shouldn’t I just eat at home?” Successful restaurant chains are answering that question in one of two ways.
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1. They’re making it supremely convenient to grab a meal or beverage.
Dutch Bros is a drive-thru-only chain that keeps the line moving. Some “broistas” even make regulars’ drinks as soon as they spot their car, so the customer doesn’t even need to place an order. They’re known for exuberant customer service, too. All this adds up to a fast and pleasurable experience that becomes part of consumers’ daily routines. Other top chains known for speed plus service include Chick-fil-A and In-N-Out (which invented the drive-thru intercom system in 1949.)
2. They’re offering a dining experience customers can’t resist.
Four of the top 10 chains in Technomic’s survey are higher-end steakhouses: Ruth’s Chris Steak House, LongHorn Steakhouse, Fleming’s Prime Steakhouse and Wine Bar, and The Capital Grille. Ruth’s Chris actually received the highest scores across segments for value — beating out quick-service chains like Jersey Mike’s and Chick-fil-A. How is a restaurant serving $60-$70 steaks (sides not included) seen as a good value?
When food is expensive across the board, “value” tends to be defined by service more than price, consumer strategist Lisa Miller told Nation’s Restaurant News. “Sixty-five percent of consumers said they’re willing to pay higher restaurant prices when they know there will be exceptional service. People like to feel special, be cared for, and they’ll pay for it.”
Pay attention to what customers are eating.
Flavor fads come and go. A wise operator pays attention to broader restaurant trends that reveal people’s actual preferences for what, when, and how they dine. Examining Restaurant Business’s Future 50 list of the fastest-growing chain restaurants (in the U.S.) gives us glimpses of what’s ahead. Here’s what we’re seeing:
Hamilton Beach Commercial can help your chain stay ahead of the trends. Our kitchen equipment works as hard as you do: Every product is powerful, intuitive, and built with the legendary durability we’re known for. Browse our full line of commercial foodservice equipment solutions.