When it comes to global expansion, international operators are quick to point to the U.S. as the gateway to success. Foodservice here is booming, with expected restaurant industry sales in 2014 surpassing $680 billion, according to the National Restaurant Association—and the limited-service sector accounts for about $230 billion of it.
The rise of Millennials as tastemakers and an increasingly diverse population has led to global and ethnic flavors becoming more in demand than ever before, opening the door for international brands to grow explosively across the states. These 10 brands are likely to lead the charge.
Pret A Manger
The team behind this London-based eatery hopped across the pond in 2000, landing in Manhattan to open their first U.S. unit just down the street from the iconic New York Stock Exchange. Described on its website as a cross between a good restaurant, an Italian coffee bar, and a bullet train, the limited-service concept focuses on fresh, pre-packaged fare to draw in on-the-go consumers. Hot and cold sandwiches, salads, soups, and pastries are made throughout the day, and unsold items are donated to local food pantries, says Joseph Iazzetta, vice president of store development at Pret. “We carry our culture of doing good all the way through our shop in terms of how we design it, how we operate it, how we believe in sourcing food, and our charity work.”
Entering the U.S. market was a litmus test for success and the permission it needed to go global, Iazzetta says. But the move was not without the expected challenges. The brand had to make some adjustments to appeal more to the American consumer, the most notable being the shift to self-serve, drip-brew coffee. The change, along with a menu that borrows flavor profiles from various cultures, has resonated well with Pret’s target urban-consumer base.
“They do really well with the urban lunch crowd because everything is prepackaged,” says Lauren Hallow, associate editor of news and concept analysis for research firm Technomic. “But they really let people know they use natural, preservative-free ingredients, so the fresh factor is still there. They do have a higher price point, and I think that’s why they’re sticking to these urban areas with affluent consumers.”
Iazzetta echoes that sentiment, adding that for Pret to thrive in a market, there must be heavy pedestrian traffic. In the coming years, the eatery will focus on growing in its current markets of New York, Boston, Chicago, and Washington, D.C., before expanding across the country, Iazzetta says. “We’re in the process of developing a deep national marketing planning strategy to provide us with a road map.”
As the largest coffee-shop brand in South Korea, Caffebene looked to the U.S. first when beginning its international expansion.
“The U.S. is the world’s biggest market, which is why we first wanted to enter the U.S. when we wanted to go global,” says Amy Inhee Park, marketing associate for the brand. “We lacked familiarity, but that was also a good thing for us because we had a blank slate.”
That blank slate allowed the U.S. team to develop a robust food offering that would differentiate the coffee chain from U.S. competitors. The menu includes lunch items like a Ham and Egg Sandwich and a Teriyaki Chicken Sandwich, as well as Belgian waffles with various toppings and Italian gelato.
“We knew pastries and bread items were everyday go-to items for American consumers, so we added more types of pastries so we could offer a wider variety of choices,” Inhee Park says.
Its South Korean roots can be seen in items like the Red Bean Bingsu, a type of Korean shaved ice, and the Misuguru latte, made with a traditional Korean grain powder called misugaru. “A lot of cafés in New York are more for the to-go guests, but for our locations, we want the customers to stay,” Inhee Park says of a key point of differentiation for Caffebene. The bulk of the coffee chain’s growth will occur in the Big Apple, with more than 40 openings planned across the city.
Though its roots may be French, Brioche Dorée’s menu draws from many European food cultures, including Italian, Persian, and Greek. Since opening in the U.S. five years ago, the gourmet café brand has focused greatly on nontraditional venues like airports, travel plazas, and even universities, thanks in part to a partnership with HMSHost. Of its 38 units in North America, 27 are nontraditional locations, says Jeff Drake, president of Brioche Dorée North America, in an email.
“We are looking to grow our nontraditional presence by 20 percent, and also to add four to six corporate storefront locations annually, and then [grow] by 10–15 percent,” he says. Drake adds that corporate in-line restaurants will open in cities like Dallas, Washington, D.C., and Chicago.
“I think they could do well if they moved to an in-line or standalone location,” Hallow says, adding that the brand’s gourmet salads, which extend beyond traditional tossed salads, and French-inspired crepes would resonate well with the American fast-casual consumer.
“The brand was founded in France nearly 40 years ago, [and] in that time, we’ve leveraged the history of who we are as a French concept. We’ve set it up as an urban bakery café—it appeals to people who live and work in the city,” Drake says. A global brand, Brioche Dorée operates more than 500 restaurants in total across Europe, Asia, the Middle East, and South America.
While many U.S. concepts built around one dessert item, like frozen yogurt or cupcakes, have seen market saturation and decline, this Japanese chain of cream puff stores continues to see robust growth.
“These guys are definitely jumping on the indulgent trend, but they do well with the snacking trend because they have some more savory options,” says Technomic’s Hallow. “And they’re affordable.”
For about $2–$3, a guest can enjoy savory items like the sweet potato cream puff or sweet treats like the green tea and honey cream puff that alludes to the brand’s roots. And they can get a glimpse at the whole baking process, too, thanks to what Beard Papa’s calls its “eater-tainment” operational model. Having celebrated 10 years in the U.S. in 2013, the brand recently made its foray into Hollywood, growing its total U.S. unit count to 26.
The montadito may be the fast-food answer to increasingly popular Spanish tapas. These sharable, bite-sized sandwiches are a culinary staple in Spain, the brand’s home market in which they operate 285 units. With a blank canvas of baguette-like bread, 100 Montaditos tops its sandwiches with combinations like meatballs and bacon; shrimp, lettuce, piquillo peppers, and ali oil; and Basque-style chorizo known as chistorra and piparra pepper. Guests can choose from 100 such combinations to build a platter of five.
“It’s a very flexible style of eating, similar to the small plates trend,” Hallow says. “It’s meant for consumers to pick a few montaditos and create their own meal or go there for something like an after-work happy hour or a situation where you can share.” An alcohol program featuring wines imported from Spain and various sangrias round out the authentic options.
Like most other international transplants, 100 Montaditos—which boasts 20 U.S. units—grew first in urban markets like Miami and New York. But “they went to Iowa recently,” Hallow says. “They have shown that they have the potential to succeed outside of the major cities.”
Dubbed by many of its fans as the McDonald’s of the Philippines, Jollibee didn’t stray from its fast-food model when it made its U.S. debut in Daly City, California, in 1989. Since then, the brand has grown to span Nevada, Texas, Washington, New York, New Jersey, Virginia, and Hawaii, with a total of 29 locations. But “the challenge with them is that most of their stores are located in areas with a high Filipino population,” says Hallow, adding that Jollibee’s comfort food could potentially resonate with Americans in regions like the South and Southeast.
The chain does indeed offer some familiar comfort food like burgers, buckets of fried chicken, and corned beef sandwiches, but it also offers items specifically catered to Filipino consumers, including burger steaks, spaghetti topped with sliced hot dogs, and frozen beverages similar to bubble tea.
When the executives of this steak and burger brand saw their home market of Brazil begin to reach saturation, they looked north to the U.S. for a new challenge. But before making its debut, Giraffas underwent a fast-casual makeover.
“We saw the fast-food market here was saturated already, too, and a lot of fast-food chains were losing space to new fast-casual concepts,” says João Barbosa, Giraffas U.S. CEO. “So our first big challenge was to adjust the concept to a fast casual.”
The brand’s upscale menu, which includes Filet Mignon Tips Stroganoff, Brazilian Shrimp Moqueca, and cheesy-bread bites called Pao de Queijo, lends the concept very well to the fast-casual space, says Technomic’s Hallow. “You can get a steak and three sides for under $14, which is something most quick serves can’t offer, and it would be hard to find it for that price point at a full serve.”
One of the keys to keeping costs low at Giraffas is the cut of beef used in its burgers, Barbosa says. While ground chuck is the go-to choice for American burger brands, Brazilian consumers prefer a cut known as picanha. As there’s little demand for this cut of beef, which in North America would be divided into the rump, the round, and the loin, it’s relatively inexpensive to source in the states.
Giraffas’ picanha burgers and steaks are familiar to the brand’s first U.S. market, Florida. With a robust population of Brazilians and Hispanics to attract, the brand has grown to 11 locations in the Sunshine State. Next year, Barbosa and the U.S. team will target urban markets like New York and Boston, and then grow westward.
“We’re aiming to have something like 110–120 restaurants by 2020 here in the U.S.,” Barbosa says, adding that the brand will eventually franchise.
The creation of peri-peri chicken, and Nando’s founding, is closely tied to the Portuguese colonization of South Africa in the late 15th century. As the story goes, Portuguese settlers discovered the African bird’s eye chili plant and concocted a hot sauce unrivaled by any other; the name peri-peri came from the Swahili word for pepper. And in 1987, Portuguese-born audio engineer Fernando Duarte and entrepreneur Robert Brozin were so smitten by peri-peri chicken served in a Johannesburg fast-food joint, they bought out the place and slowly grew it into a chain across South Africa. Today, Nando’s spans 23 countries across five continents, numbering 1,100 restaurants.
“The U.S. was always on the radar of the founders, but there was a healthy respect for what it takes to make it in the U.S. because it’s often referred to as the largest consumer market in the world and a lot of brands have attempted expansion here,” says Burton Heiss, U.S. CEO for Nando’s.
The South African brand broke into the U.S. market by way of Washington, D.C., which was seen as an international city, Heiss says. With 20 units across the District and bordering Virginia, Nando’s U.S. operation resembles U.K. restaurants in service style. That’s informed by the breakdown of traffic, Heiss says. In South Africa, 70 percent of all orders are takeaway, while in the U.K., a whopping 90 percent are dine in. In the U.S., 80 percent of orders are dine in, which is why the brand looks more like a fast casual, with counter service, real plates and silverware, and fine-dining décor touches. Most importantly, each restaurant operates like a part of the community, Heiss says.
“The shareholders and founders never envisioned being able to operate things from a boardroom 3,000 miles away,” he says. “The plan was always to set up local leadership and give them authority and autonomy to grow. We are an international brand, but very much a local business.”
Le Pain Quotidien
Stepping into one of Le Pain Quotidien’s restaurants in the U.S. is much like being transported to a Belgian café: Rustic wooden accents create a warm atmosphere, branded jams and jellies line shelves, fresh bread and pastries fill display cases, and in the center of it all sits a large communal table. The fast casual’s menu boasts a robust breakfast menu, Belgian open-faced sandwiches known as tartines, quiches, gourmet salads, and sharable platters of meats, cheeses, and breads.
“We believe that in big, urban cities, the biggest challenge consumers face is loneliness. One of our icons is the communal table,” says CEO Vincent Herbert. “We want to make sure guests at Le Pain Quotidien can reconnect with themselves and enjoy not only service, but also hospitality.”
With that mission in mind, Le Pain Quotidien entered the U.S. in markets like New York, Philadelphia, Los Angeles, and Washington, D.C. Herbert says the challenge of breaking into the “biggest, most strategic, and probably the most competitive market” enticed his team because they believed the brand’s core values would be appreciated in the U.S. They faced initially higher rent than the company was used to in European markets, meaning the team had to be certain each location would yield high profits quickly, Herbert says. The crux of its success has been the brand’s ability to not look like a chain.
“It’s not about a chain of 220 restaurants; it’s about being one store in one neighborhood 220 times,” Herbert says. “For us, growth is not a strategy.”
A Middle Eastern street food, falafel is an increasingly common item in the U.S. fast-casual scene. The chickpea fritter is the core of Amsterdam-based Maoz Vegetarian, created in 1991 by an Israeli couple looking for a taste of home in the Netherlands. And though it’s grown to four other countries and the U.S. since its founding, Maoz hasn’t strayed from its meat-free roots.
“The difference with this falafel brand is that it is a fully vegetarian concept,” says Technomic’s Hallow. “Most of the other Mediterranean concepts have offered a protein somehow.”
The menu includes salads and sandwiches made in pita bread with either falafel; vegan shawarma; or hummus, egg, and eggplant. Guest can customize all items with toppings like babaganoush, a traditional dish with eggplant, onion, and tomato; Feta cheese; and hard-boiled egg. Some Maoz locations also feature a fresh-squeezed juice bar with fruits and veggies like beets, kale, apple, spinach, carrot, ginger, and other fresh fare.
To thrive in the U.S., the brand did make some changes, including reformulating its falafel fritters to be gluten free, says Aviv Schweitzer, operations manager for Maoz USA. “We also introduced sweet potato fries, which quickly turned out to be a hit.”
With 12 units in the U.S., the brand is focusing on New York expansion, with a unit set to open in Long Island in January, Schweitzer adds.