Special Report | August 2013 | By Sam Oches

The QSR 50

The 50 brands setting the pace in the quick-service and fast-casual restaurant industries.

The top quick service and fast casual restaurant brands in the United States.
flickr / powerplantop
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1

McDonald’s

rank last year: 1

And the No. 1 brand in the 2013 QSR 50 is … Subway!

Just kidding. It’s McDonald’s. And unless McDonald’s maybe-we-should-be-panicking-now growth funk picks up (quite a bit of) steam, this will continue to be the case for some time.

But there are reasons for new CEO Don Thompson and his leadership team to be worried. The slump the company skidded into late last year—one that cost U.S. president Jan Fields her job—doesn’t seem to have an easy fix. Fast-casual brands continue to eat into market share. Premium products like the Angus burger and Fish McBites fell flat and were pulled from the menu. Healthier options like the new Chicken McWrap haven’t taken off quite like the company expected. And even though McDonald’s continued in the last year to up its commitment to health and nutrition—with extensive activity promotions surrounding the London Summer Olympics, its decision to post calorie counts to all domestic menuboards, and new packaging that is more transparent about nutrition, as examples—it still can’t shake critique from outside groups who say the company should be doing more.

All of the negative mojo has Thompson talking about the potential of doing all-day breakfast and refocusing the menu on more burger and value products. It seems the Golden Arches might have, at least for the time being, lost a little bit of their shine.

2

Subway

rank last year: 2

Looking for a mindless game to play throughout a lazy week? Check in with Subway.com every now and then and watch as the global store counter ticks higher and higher. (Get your coworkers involved! Place bets!) OK, it’s not as fun as it might sound. But the truth is that Subway adds restaurants like Justin Bieber adds Twitter followers, and as most chains only experienced modest growth in unit counts last year, Subway tacked on another 1,000 or so U.S. stores. And for the most part, it did so by doing more of the same; aside from continued investment in athlete spokespeople, the rollout of more sustainable packaging materials, and scoring the title of first restaurant to get involved with the American Heart Association’s Heart Check program, Subway didn’t make much of a blip on the news merry-go-round in the last year. Customer surveys, meanwhile, continue to play up Subway as the top-perceived brand in quality, health, and value.

3

Starbucks

rank last year: 3

The brand that made premium coffee a quick-service staple is diversifying its menu mix, wheeling and dealing in the last year and a half to invest in tea (it acquired Teavana for $620 million), juice (Evolution Fresh for $30 million), and baked goods (La Boulange for $100 million). Also making waves are recently added Starbucks originals, like the new oatmeal blend, the Refreshers caffeinated fruit beverages, the Blonde roast, new Frappuccino flavors, and the Verismo make-it-at-home machine. At the same time, Starbucks has continued to be the voice of Millennials, becoming the first major restaurant brand to get on board with tech tools like Square and Apple’s Passbook.

As always, keeping up with the times has worked wonders for Starbucks; its second quarter of 2013 was a record setter, with total net revenues up 11 percent and global comparable store sales up 6 percent.

4

Wendy’s

rank last year: 4

If you’re looking for a brand that’s ever-so-carefully walking the tightrope between its down-home tradition and a we-love-Millennials future, look no further than Wendy’s. The Freckled Lady is moving forward with an updated company store prototype meant to compete with fast casuals, and it unveiled a new logo that favors a more modern script style. This year’s new Flatbread Chicken Sandwiches and Waffle Cone Frosty offered the playful menu innovation so desired by that younger demographic. Wendy’s even launched a Moonlight Meal Deal—a Double Stack hamburger, Chili Cheese Fries, and a large soft drink for $5 after 10 p.m.—that it very directly stated was meant to appeal to Millennials.

Still, Wendy’s respected its comfort-food roots with a trio of new sides—Mac and Cheese, Chili Cheese Fries, and a Baked Sweet Potato—and looked again to the tried-and-true value meal. The new Right Price Right Size Menu offers up to 18 menu items ranging from 99 cents to $1.99.

5

Burger King

rank last year: 5

At long last, Burger King finally settled down and stuck to its guns with … Hmm? What’s that? A new line of premium coffee beverages? A Turkey Burger and a Veggie Burger? Another executive shakeup? Next you’ll say they’re trying out delivery service.

In Burger King’s ongoing quest to better compete with McDonald’s, the brand has indeed been endlessly tinkering with its menu mix. The last year saw a barbecue-inspired menu, a chicken-inspired menu, Chicken Nuggets, a Bacon Sundae … the list goes on. Still, the proof is not yet in the pudding, and the King only experienced modest sales gains over 2011.

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