Industry News | September 26, 2011

Do Independents Have An Advantage Over Chains?

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Battling with low operator and consumer confidence, rising food costs, and a lack of corporate support, independent restaurants can be especially hard hit during poor economic times. However, recent Mintel research reveals that indies may have some advantages over their competition, as 43 percent of American consumers who have visited one in the past month seek out independent restaurants over chains.

Moreover, 52 percent of independent restaurant users say they visit these establishments to support their local community/economy while 51 percent agree that independent restaurants do a good job of supporting their local community—compared to 37 percent who say the same of chain eateries.

“People take pride in their communities and will often reward local businesses that make their community a better place,” says Eric Giandelone, director of Mintel Foodservice. “The primary way indies underperform in relation to chains is through a lack of promotions and limited-time offers, two things that could be easily addressed with social shopping and social networking sites.”

Among those patrons who had not visited an independent restaurant in the past month, 22 percent of respondents said it was too expensive, but over half (56 percent) of people say they are willing to pay more at an indie. According to Mintel, the majority of diners are willing to pay up to 10 percent more for an independent dining experience for similar food and service found at a chain.

“Independent restaurants have the advantage of being able to provide a unique experience for customers and have the freedom of not having to comply with government-mandated laws that chains have to face,” Giandelone says. “While chain restaurants are able to offer up a big helping of value and convenience, they need to focus on areas of opportunity where independents are rated better, such as unique menu items and local flair.”

Forty-two percent of restaurant-goers say independents are superior to chains when it comes to food quality and the ability to customize their orders. However, 21 percent believe they do a worse job than chains in regards to convenience and 20 percent say they fall behind chains in the area of fast service.