Eating out is now a lifestyle among consumers in the US. This article will discuss the different kinds of restaurants in the market at the moment – quick service restaurants (QSR’s) and full service restaurants (FSR’s). Scroll down to find out more about how Americans like to eat out.
Quick service restaurants include limited-service eating places, fast-food restaurants, pizza-delivery establishments, ice cream parlors, beverage bars, cafeterias, carryout sandwich shops, and carryout service shops with on-premise baking of donuts, cookies, and bagels.
Quick service restaurant chains are regularly called into question due to their supply and production of unhealthy foods. During an online survey in 2016, 39% of the respondents said that healthy options play a major role when choosing a fast-food restaurant.
In 2016, a Restaurant Habits Survey carried out among Americans aged 18 years and older determined how frequent they eat at quick service restaurants. 20% of the respondents said they dine out at quick service restaurants once per week while 18% stated that they dine out several times per week.
Full service restaurants (FSRs) are restaurants mainly engaged in providing food services to customers who order and are served while seated and pay after eating. It was estimated that there were 33,160 FSR franchises establishments in 2019.
Most Americans, 44% to be exact, stated in a November 2016 survey that they very much enjoy dining out at a full service restaurant.
One of the hallmarks of a great city is a smorgasbord of great places to eat. The “food scene” according to Joe Cortright, principal economist with Impresa, is an important component of the urban experience.
The biggest restaurant city is San Francisco, with 39.3 restaurants per 10,000 households. Other restaurant-dense cities include New York City, the areas outside of New York City, Boston, Seattle, and San Jose, California.
San Francisco, CA
Fairfield County, CT
Long Island, NY
New York, NY-NJ
San Jose, CA
Orange County, CA
Each year, the QSR magazine takes the pulse of the quick-service landscape – from systemwide sales to average-unit volumes, in order to take a peek at the country’s most dynamic industries, which is often referred to as the heartbeat of American consumer.
Although it’s pulled back significantly in the last couple of years, sandwich giant Subway remains by a great deal the largest restaurant chain. It’s 24,798 domestic locations are 9,973 ahead of Starbucks.
Chick-fil-A claims the number one spot as America’s best fast-food chain for the fourth year in a row, according to the 2019 American Customer Satisfaction Index.
The index polled 23,000 consumers on fast food, and Chick-fil-A got the number 1 spot with an overall score of 86 out of the possible 100. The Georgia-based chicken chain is down one point from last year and 7 points higher than the average score for all limited-service restaurants.
Founded in 1946, the restaurant chain is associated with the Southern United States and was also the most popular chicken restaurant chain among US consumers as of April 2018. In addition, Daily Mail reported that Chick-fil-A is also continuing to grow, generating more than $10.5 billion in its most recent fiscal year.
Ibis World reported that there are 125,444 chain restaurants businesses in the US as of 2020, with a 1.4% year-on-year average growth from 2015-2020. The number of businesses in the chain restaurants industry is expected to grow by 1.9% in 2020. The Southeast region is where most of the chain restaurants are located.
In Spring 2018, there were 307,940 chain restaurants and 352,815 independent restaurants in the US.
Any one who owns a restaurant will tell you that it’s way harder than it looks. If you manage to push through your initial year with only a few hiccups, you can expect to hit your return of investment (ROI) in roughly 4 years. The industry standard is 3 to 5 years.
Owing to how challenging it is to run the different aspects of a food service establishment, the SaaS industry has its own sector called restaurant management software.
In 2015, there were approximately 14 million people working within the industry, and this number is expected to reach over 16 million by 2026.
In 2019, roughly 3.88 million employees worked in the quick-service restaurant (QSR) franchise industry in the US. This is a 35% increase since 2010.
On the other hand, employment in the table/full service restaurant franchise industry was estimated at 1,116,894 in 2019.
Like other service-oriented industries, the hours in the food service industry is varied and can be demanding, so one can argue that the pay is not commensurate to the energy and effort employees put into their work.
Chefs and head cooks
Cooks, private household
First-line supervisors of food preparation and serving workers
Cooks, all other
Cooks, institution and cafeteria
Waiters and waitresses
Food preparation and serving related workers, all other
Cooks, short order
Food servers, nonrestaurant
Food preparation workers
Dining room and cafeteria attendants and bartender helpers
Hosts and hostesses, restaurant, lounge, and coffee shop
Counter attendants, cafeteria, food concession, and coffee shop
Cooks, fast food
Combined food preparation and serving workers, including fast food
Since 2004, the quick service restaurant sector (QSR) in the US has seen a year-over-year growth, with its peak consumer spending reaching approximately $300 billion in 2018. Similarly, a notable 7% decline in consumer spending was seen in 2019.
According to the 2017 fall census from NPD group, the number of independent restaurants in the US fell 3%, which brings the number to 346,105 units, a decrease of 10,952 units from the same period last year. This came as a result of chain restaurants remaining flat with their 2016 numbers.
The drop in independent restaurants was mostly in sit-down restaurants, as Americans increasingly favor grab-and-go delivery options. Overall, the number of US restaurants declined 2% for the period to 647,288 units. Full-service restaurants on the other hand, also fell 2%, to 294167.
The restaurant business is very tough. The average lifespan of a restaurant is five years and according to some estimates, up to 90% of new ones fail within the first year. However, there are some very successful exceptions that manage to succeed amidst challenges and competition.
Joe's Stone Crab
Carmine's (New York)
The Boathouse Orlando
Old Ebbitt Grill
Lavo New York
Smith & Wollensky
Gibsons Bar & Steakhouse
Bryant park Grill & Cafe
National Restaurant Association conducted the What’s Hot survey in November-December 2019, wherein 600 American Culinary Federation chefs answered an online survey, asking them to rate how hot below trends would be on a scale from sizzling hot, steaming, simmering, and just room temperature.
Top 10 overall restaurant trends for 2020:
While some of these trends already sound familiar and are self-explanatory, others are new to the ear, or at least in terms of what it’s called. For instance, stress relievers refer to ingredients in food that promote relaxation/relieve stress. Specialty burger blends include mushroom-beef burgers and other plant-based burger patties options.
Aside from above mentioned trends, food halls will continue to grow in popularity as aspiring restaurateurs realize that they don’t need to sink all their startup budget into brick and mortar locations. Food halls are communal dining spaces where operators can rent a booth to test out their restaurant concept.
When it comes to QSRs, lifestyle campaigns and limited time offers (LTOs) will be key to marketing. more and more restaurants will invest in wacky and Instagrammable merchandise as part of their customer retention efforts. Brands will also continue to lean into specialty LTOs in order to pique consumer interest and drive social media engagement.
The restaurant industry is the type of business that if you don’t evolve or innovate, your business will die. Consumers will eventually get tired of the same menu, hence introducing new product concepts is one of the keys to keep your restaurant afloat. It’s crucial for the restaurant owners to be perceptive and know what their clients want. Because as the lifestyle of people changes, so does their diet.
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