Web Exclusive | November 2012 | By Kevin Hardy

The Fifth Meal

Is brunch the next big daypart?

Some fast casuals find that offering brunch could open a new door for revenue.
Salsa Fiesta offers Huevos Rancheros as part of its brunch menu.
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The breakfast and post-dinner dayparts have proved to be successful business extensions for many quick serves the last few years.

Now, some operators are testing another daypart: brunch.

Florida-based fast casual Salsa Fiesta added a brunch offering to its fresh, made-to-order Mexican menu to open the door for additional weekend sales. The brunch menu, served from 10 a.m. to 1 p.m. on weekends, includes items like an enchilada omelet, gluten-free waffles, huevos rancheros, and “hangover tortilla soup,” complete with a fried egg on top.

“It’s something a little different and unique,” says owner and cofounder Cesar Olivo. “In South Florida, there’s nobody doing a brunch menu.”

So far, the brunch addition has been a big success at the concept’s two stores. Olivo says weekend sales are up about 5 percent since adding brunch three months ago, and sales continue to climb each Saturday and Sunday.

The new menu is playing well with Salsa Fiesta’s regulars, as well as pulling in new customers and families who enjoy a post-church brunch on Sundays.

“It’s an experience for the whole family,” Olivo says. “For that time, they have the possibility of enjoying and sharing a little bit with their family members.”

Salsa Fiesta’s weekend sales are up about 5 percent since adding brunch three months ago, and sales continue to climb each Saturday and Sunday.

Consumer demand for breakfast and brunch is a key driver for First Watch, a multistate chain of 103 restaurants. First Watch stores are open from 7 a.m. to 2:30 p.m. daily and always offer a menu with breakfast, brunch, and lunch options. Breakfast is king, accounting for about 50 percent of weekday dining. Restaurants also do about half of their business on Saturday and Sunday.

First Watch has filled a unique niche, says CMO Chris Tomasso. Its menu offers something for everyone, with heavy traditional breakfast and brunch items alongside several lighter dishes. That, along with the overall growth in the morning daypart and the rise of the value-minded consumer, has given the brand a distinct positioning, he says.

Tomasso says the brunch market is getting more crowded. But for now, First Watch sees chef-driven neighborhood restaurants as its biggest competition—not quick-service or fast-casual chains.

“We have seen more and more restaurants start offering brunch,” he says. “Basically, what they’re trying to do is utilize their physical space during more hours, and brunch or late-night seem to be the two areas they’re focusing on. And I think there will be more restaurants continue to open for that daypart.”

But while breakfast has become an increasingly popular offering at quick-service and fast-casual restaurants, not everyone is convinced brunch will be as successful.

“I think brunch becomes a difficult occasion for [quick-service] operators to effectively address because this is typically a sit-down event for consumers,” says Maeve Webster, director of food industry market research firm Datassential. “It’s almost exclusively a weekend event, which wouldn’t be very effective for a [quick serve] to offer. As a result, we see [operators] going the more traditional breakfast daypart route and offering it throughout the week.”

Webster says the penetration of fast feeders offering breakfast has risen steadily since 2006, while the growth of brunch menu items hasn’t moved at all in the segment.

Salsa Fiesta leaders noted some difficulties when first adding brunch items.

“At the beginning, it was a little challenging because all our line cooks and everybody needed to adapt to a completely new menu,” Olivo says. “But after a while—three or four weeks—they felt more comfortable.”

So comfortable, in fact, that owners are now considering adding a weekday breakfast menu aimed at drumming up more sales with the business crowd.

Tomasso says established operators will face a range of other challenges when looking to add a new daypart like brunch. Chief among them, he says, is that brands will have to build recognition of the new daypart among their consumer base.

“It’s a brand thing and trying to get your customers to look at you as something other than [how] they’ve known you,” Tomasso says. “Sometimes a consumer has a hard time comprehending that and understanding that. It takes a while for that offering to take hold.”

But Tomasso views the growing battle over breakfast and brunch dollars as good for business.

“If the awareness of breakfast and other concepts coming into it gets more people thinking about [the morning daypart] and going out for breakfast, that will also help us,” he says.