The Golden Arches' now-years-long slump has shifted from curious anomaly to serious quagmire, a challenge that company brass seem to grow more impatient with every day. That impatience came through loud and clear in March when CEO Don Thompson announced his resignation and company veteran Steve Easterbrook was tapped to fill his shoes. It also showed itself in May, when Easterbrook starred in a much-hyped video in which he spelled out exactly how McDonald's would turn things around, a plan that includes an organizational restructuring and a refranchising initiative.
But the impatience is seen on the development front, too, as the company has thrown an awful lot of (proverbial) spaghetti at the wall to see what sticks. There's the new "Create Your Taste" burger-customization program the brand is testing at select stores, and the axe it's wielded against lesser-performing menu items. There's also the all-day breakfast push, which McDonald's seems to finally be embracing. Who knows: Maybe the antibiotic-free chicken will be enough to convince responsibly minded customers to return to the Happy Meal nostalgia of their roots, or maybe the new-and-improved Hamburglar will sway enough hipster Millennials to bring their kids by for a spin through the PlayPlace to create a whole new legion of followers.
There is some precedence here; McDonald's seems to suffer through at least one serious slump per decade, and at least up until now has righted the ship—and then some—every time. Will the same be said for its current losing streak? Only time will tell.
Few brands had as much to crow about as Howard Schultz and company in 2014. The company posted the largest sales influx of any quick serve last year with a $900 million–plus climb over the previous year, and it rallied off headline after headline of not only development news—there were new baked goods, specialty beverages, and wraps, as well as a commitment to add more food and alcohol products in the next five years—but also progressive news, like its new mobile-ordering platform, delivery tests, and the Reserve Roastery & Tasting Room, which gives the company a whole new prototype for potential growth.
If you thought Subway was impervious to struggle, think again. Last year marked the first time since 2008 that Subway found itself in anything but the No. 2 spot on the QSR 50, ceding the position to Starbucks after watching its systemwide sales fall a staggering $800 million in 2014. This was despite adding 778 stores to its net unit count, a combination that dropped the brand's average unit volume and suggested the company might at last be bumping back against some market saturation. Founder Fred DeLuca, however, disagrees; he announced last year an ambition to add 8,000 new restaurants by 2020.
The wrestling match between Burger King and Wendy's for the position as the industry's second-biggest burger joint continued in 2014, with Burger King coming out on top after posting a $100 million sales climb over 2013. The brand's healthier Satisfries may have been a disappointment—they were yanked from the menu last August—but Burger King turned that frown upside down at the end of 2014 when it merged with Tim Hortons in a $11 billion mega-deal and relocated its corporate headquarters to Canada.
Wendy's may have lost the burger war with Burger King, but its menu development department might yet prove victorious. The company launched a bevy of creative dishes in the last year, including a BBQ Pulled Pork line, new sandwich builds on its brioche bun, and Ghost Pepper Fries, while it also tested a build-your-own-sandwich platform. But menu news wasn't all the Freckled Lady had to offer; the company announced this summer that it would open 90 Degrees Labs in Columbus, Ohio, as a center where employees could explore new technology innovations.
Oh Taco Bell, how does a restaurant writer count the ways to love thee? Your cup overfloweth with news; your streets are paved with milk-filled Cap'n Crunch Donuts and Jalapeño Honey. In the last year, there was the novel (the Donuts test and the Biscuit Taco with Jalapeño Honey), the responsible (the announcement to remove artificial ingredients), the innovative (a new mobile ordering app and a delivery test), the ambitious (plans to be a $14 billion brand by 2022 with 1,300 international units by 2023), and the irreverent (the shots fired at McDonald's in advertisements supporting the breakfast menu). And all of it seemed to work; last year, Taco Bell did $400 million better in sales over 2013 and added nearly 600 units to its net count.
America is increasingly running on Dunkin', as several new Western markets accounted for many of the 400-plus new units the brand added last year. As Dunkin' fortifies its reach from sea to shining sea—not to mention in international markets, which will soon include a re-entry in Mexico and much larger presence in China—it's not ignoring the menu, and late last year made a splash with the Croissant Donut rollout.
Let this fact sink in for just a bit: Chick-fil-A, in many regards still a regional quick-service player, now does more in annual sales than any pizza brand in America. Or how about this: Its average unit volume now tops $3 million. Oh, and this: It's still closed on Sundays.
Fast-casual pizza may get all the headlines these days, but the big guys haven't rolled over. Last November, Pizza Hut announced a brand reboot that was a year in the making, a reboot that featured a new logo and a "Flavor of Now" menu that included 10 new crust-edge flavors, five new signature sauces, four new drizzles, and five new ingredients. It then joined its Yum! Brands sister Taco Bell this summer in announcing the removal of artificial flavors and colorings from the menu.
The day has finally come: The fast-casual category now occupies the QSR 50's elite top 10. Panera Bread leapfrogged KFC to join the ranks, adding $120 million in sales and 103 net stores over 2013. Its Panera 2.0 technology upheaval continues to roll out to the system, and in May the company announced its "No No" list of unacceptable ingredients, which removed all additives from the menu.
The former king of chicken's Original Recipe turned 75 this year, and that may be as good a time as any to lay the groundwork for a turnaround, which KFC sorely needs. That begins with a resurrection of sorts; KFC reintroduced Colonel Sanders—as played by comedian Darrell Hammond—to its marketing efforts, including a series of offbeat commercials that some consumers have found sort of, well, creepy. The turnaround does not, at press, include any plans to incorporate antibiotic-free chicken (a la McDonald's and Chick-fil-A) or to remove artificial ingredients, a plan that sister brands Taco Bell and Pizza Hut embraced in the summer.
Speaking of resurrections, Domino's keeps cruising five years after it staged its own return from the dead by ditching its old pizza recipe and starting from scratch. Last year's marks—a $300 million systemwide sales and 81 net-unit climb—were just another chapter in the turnaround story, as were the company's many innovations in the last year, including the voice-ordering function on Domino's app (lovingly named "Dom") and the ability to order through Smart TV, Smartwatch, and, yes, even a tweeted emoji.
Sonic mustered its own growth story in 2014, in no small part due to the tastes of Americana it continued to roll out to its menu (including a French Toaster Breakfast Sandwich, Cheesy Pub Chicken Sandwich, and Cheesy Bread Dog). It helps, too, that one of sports' biggest superstars—Oklahoma City Thunder forward Kevin Durant—resides in the company's backyard and became an official spokesman for Sonic earlier this year.
Call it the awkward teenager phase. Chipotle, which has been on an incredible growth trajectory for several years and has long served as the cooler younger brother to the legacy brands, has run into a few hiccups of late. There was the controversy around its "Cultivating Thought" initiative, which initially didn't feature any Hispanics on its roster of artists and thinkers. And then there was the episode with its carnitas earlier this year, in which the company pulled the pork product from hundreds of stores after a supplier violation. Most recently, the brand experienced some blowback when it announced that all of its food products were GMO-free; while Chipotle championed the initiative as part of its "Food with Integrity" mantra, critics claimed it was a move based on bad science. Still, the hiccups did nothing to slow the brand down, as it registered an $800 million sales climb over 2013, second only to Starbucks in improvement last year. With a delivery test in place and whispers about adding chorizo to the menu, Chipotle shouldn't have any problem putting the awkward teenage phase behind it.
It's hard to fault Carl's Jr. and Hardee's parent CKE for seizing upon opportunities when it sees them. The company that develops so-called "Mile High" sandwiches, slaps warning labels on ultra-spicy foods, and sticks ice cream in the middle of a split Ding Dong made a splash during this year's Super Bowl when it debuted an advertisement featuring a carefully placed naked model traipsing down a busy street. The ad was just the latest in a string of risqué model-showcasing commercials, this one selling, of course, the All-Natural Burger made with an all-natural, grass-fed, free-range beef patty that has no added hormones, antibiotics, or steroids. As planned, Millennial men ate it up.
Hardly a pizza also-ran, Little Caesars surged up the QSR 50 thanks to a $200 million sales bump. The Detroit-based company last year announced a new investment in its Motor City home, committing to opening a 205,000-square-foot Global Resource Center that more than doubles its current headquarters. It played around with its menu, too, making waves with both a soft-pretzel-crust pizza and a bacon-wrapped pizza crust.
Like KFC, Dairy Queen is celebrating its 75th anniversary this year, and like the chicken chain, the dessert favorite is going big with the celebration. The company's so-called "Fanniversary" kicked off in January with a special Birthday Cake Oreo Blizzard, and the brand is running specials throughout the year commemorating its birthday. On March 16, all Dairy Queen locations in the U.S. and Canada offered free 5-ounce servings of vanilla soft-serve cones while accepting donations to the Children's Miracle Network Hospital.
Someone at Arby's must have made the age-old quote, "If you can believe it, you can achieve it," their life motto. The company established a goal to hit $4 billion in sales by the end of 2018, and while it may have seemed far-fetched shortly after the brand bottomed out during the recession, doggone it if the company isn't well on its way toward achieving that goal. Arby's saw a 9.8 percent same-store-sales increase in the first quarter of this year, its 18th consecutive quarter of growth. The brand's new store prototype might be partly to thank; the Inspire design integrates production and service counters, reduces store square footage, and increases operating efficiencies while improving the guest experience.
Jack in the Box
Never one to settle for the ordinary, Jack in the Box was decidedly outside the box with its menu innovations in the last year. From the Croissant Doughnut to the Chick-n-Tater Melt, and from the Stacked Grilled Cheese Burger to the Loaded Nuggets, the brand's new menu adds found a way to appeal to the more adventurous diners out for a bite morning, noon, or (late) night.
Digital and mobile orders are the future of quick service, and perhaps no brand epitomizes that truth more than Papa John's. The pizza giant announced in December that for the first time in its history, digital sales accounted for more than 50 percent of business—an industry first.
Popeyes Louisiana Kitchen
Popeyes continues to channel the spirit of New Orleans into its menu additions, which have recently included a Red Stick Chicken (marinated in Tabasco pepper sauce and cayenne and served with Cajun Fries, a buttermilk biscuit, and the new Smok'n Pepper Ranch dipping sauce), Beer Can Chicken, Ghost Pepper Wings, and the $5 Bonafide Big Box, which comes with either two pieces of Bonafide fried chicken or three tenders and is served with a choice of two signature sides and a buttermilk biscuit.
At a time when big, bold flavors and global cuisines are increasingly all the rage, it may come as a surprise that Panda Express continues to be the only Asian brand in the QSR 50. It's probably no surprise, however, how the company continues to grow. Limited-time offers like the Chinese Spare Ribs give the brand a competitive differentiator, while a new digital ordering platform and the fast-casual Innovation Kitchen prototype in Pasadena, California, represent big steps into the future.
Whataburger continues to grow, having added more than $200 million in sales in 2014. But, at least for consumers, accessibility continues to be a problem; there's just not enough of the regional burger brand to go around. The company's partnership with the grocery outfit H-E-B is helping to allay some of those access-ibility concerns, as the retail company added Whataburger's chips, pancake mix, sausage, sauces, mayonnaise, and honey butter to its shelves in the last year. But the grocery chain probably won't be able to do anything about accessibility to Whataburger's breakfast menu, which was briefly restricted this summer when the brand limited its morning hours due to the avian flu scare.
It may not make much of a splash in the headlines, but Jimmy John's success is anything but ho-hum. The gourmet sandwich peddler wowed with a nearly $300 million sales bump in 2014 and tacked on more than 300 additional units.
Zaxby's became a billion-dollar brand for the first time in 2013, but it's not resting on its laurels. The chicken fast casual, which scored another successful year in 2014 and is celebrating its 25th anniversary this year, has big plans on the horizon for its Farmhouse prototype, which debuted in Easley, South Carolina, in January.
Five Guys' growth has slowed considerably compared with its recession-era surge up the QSR 50, but it's no less impressive that the brand that essentially created the blueprint for its better-burger competitors still grew steadily in 2014, with a $70 million sales and 45-unit bump.
The better-burger trend may have ushered several new burger joints to the quick-service dance floor, but so far none have managed to steal any of Culver's thunder.
Bojangles' joined Culver's as new additions to the billion-dollar-brand club in 2014, which must have been as good a time as any to kick the company into the next gear. In April, the Southeast favorite filed its paperwork for an IPO, which launched May 8 and closed at $23.75 for the day, a 25 percent gain over its initial listing.
Steak 'n Shake
It may not have been as significant as Dunkin' Donuts' entry into the Golden State, but Steak 'n Shake's debut in California last year was still a significant achievement, especially for a brand that's been kicking around for 80-plus years. And while CEO Sardar Biglari continues to be a polarizing figure—he barely survived a shareholder vote to oust him from his company, Biglari Holdings, in the spring—Steak 'n Shake has seen 24 consecutive quarters of same-store sales growth as of the first quarter of this year.
Church's Chicken is looking to position its brand as the value chicken joint and launched a rebuilding initiative to get it there. The rebuilding will include a new marketing campaign, brand image, decor packages, and new product news. Church's also partnered with Ink Link Marketing for public relations support.
Let's face it: Everything tastes good on a pizza. The take-n-bake pizza specialists at Papa Murphy's have thrived on that idea, and rolled out a series of innovative pies this year, including the Taco Grande Pizza, BBQ Pizza Trio, and Steak Fajita Pizza. The brand also debuted Thick 'n' Cheesy HomeBaked Bread and added a gluten-free crust to the menu.
El Pollo Loco
Of all the success stories lining the QSR 50, perhaps none surprise as much as El Pollo Loco. Not to say the brand doesn't deserve it—the R&D department has toyed with new flavors like Baja Shrimp and four different Hand-Carved Chicken Salads—but as a super regional chain (the vast majority of its restaurants are in California), the $120 million sales bump in 2014 that shot it five spots up the 50 was downright impressive. Maybe it's the company's push eastward, which in the last year included growth in Texas and Utah. Or maybe it's just good juju from the company's IPO, which impressed analysts last July when it exploded out of the gates and, at press, continues to ride high.
The intense burger competition doesn't seem to be getting to the Checkers/Rally's twins. The double drive-thru brands added more than $30 million in sales over 2013, while the net unit counts climbed by 20. (Editor's note: We originally stated that Checkers/Rally's had hit a snag in 2014, with sales slightly falling. This was based on incorrect sales data. Checkers/Rally's grossed $756 million last year, not $717.2 million, which would be good to bump it one spot up the QSR 50. QSR regrets the error.)
Dallas-based Wingstop only just debuted on the QSR 50 in 2013, but the wings brand is already preparing for prime time. Wingstop registered the biggest jump up the list this year after leaping 11 spots with a $138 million sales boost last year. The excitement continued this year, as the sizzling brand launched a $75 million IPO in June that wowed with a 61 percent increase on its first day of trading.
In the fast-casual Mexican wars, Qdoba has always been the clear No. 2. But the brand made a serious statement last year, boosting its year-over-year sales by $77 million and store count by 23, good to move it five spots up the QSR 50. A line of Smothered Burritos (smothered, that is, in sauce) and two new sides—Bacon Jalapeño Queso and the cheese/guacamole hybrid Quesomole—brought fresh innovation to the brand.
Aside from its always-popular doughnut LTOs (OREO Dirt Cake Doughnut, anyone?), Krispy Kreme turned up the attention to its beverages, launching a K-Cup
Three Fresca Bowl varieties, with fresca lime rice and seasoned black beans, gave Del Taco a more healthful menu item to boast about last year, as did a new ground turkey recipe. The company has a lot of white space ahead of it, as it's pushing for big growth in Georgia, Florida, and the Carolinas.
The slider is as good a palette as any to ratchet up the bold flavors, and White Castle has done that with its Sriracha Chicken Sliders, Jalapeño Cheese Sliders, and Jalapeño Breakfast Sliders.
The Canadian coffee-and-doughnut favorite still struggles to make serious inroads into the U.S., but with new big brother Burger King in tow, doors might be opening—literally and figuratively—at a much quicker pace.
Jason's Deli has always led the charge on the nutritional front, being one of the first quick-service brands to remove trans fats and high fructose corn syrup from its menu. That leadership status continued last year when the chain launched a gluten-free chicken nugget systemwide.
Boston Market won a HALO Award last year from Food News Media, QSR's parent, and for good reason: The brand has a menu of 150 meals with 550 calories or less, an allergen menu, and an online nutritional calculator, and it removed salt shakers from tables and has reduced sodium levels in all menu items by 15 percent. The company's new marketing campaign, "All Good," touts the nutritional strides Boston Market has made.
It's steady as she goes at In-N-Out Burger; the mega-successful West Coast burger joint hummed along with 10 new stores and a $26 million sales jump, good enough to slide it a couple of spots up the 50.
Moe's Southwest Grill
Like Wingstop, Moe's debuted on the QSR 50 in 2013, and also like Wingstop, the fast-casual Mexican chain is already cruising up the list. Celebrating its 15th anniversary this year, the brand has already opened its 600th restaurant, which it did in Salt Lake City in May.
Long John Silver's
The seafood quick serve suffered the biggest drop of any brand on the QSR 50, tanking 11 spots after it watched its systemwide sales fall more than $100 million over 2013 and its unit count sink by 75 restaurants. New CEO James O'Reilly, who came over from Sonic in February, is tasked with turning the ship around.
Long knocking at the QSR 50's door, Firehouse Subs charged through for the first time this year, riding high after a $110 million sales boost in 2014. The fast casual launched its first-ever national TV ad, featuring founders Robin and Chris Sorensen, earlier this year and announced its goal of having 2,000 stores by 2020.
Though its average unit volume is a QSR 50 low of $220,000 and its growth has been relatively stagnant, there may be some reasons for optimism at Baskin-Robbins. For one, it survived the frozen-yogurt boom unscathed. Plus, its sister brand Dunkin' Donuts' world-domination plan should give at least a sliver of a coattail to ride for the foreseeable future.
Jersey Mike's Subs
Another newcomer to the QSR 50, better-sandwich brand Jersey Mike's had a year to remember in 2014, with a $120 million sales boost over 2013 and 144 additional net units. Growth is motivated by the brand's traditional delicatessen experience, but also by the fact that Jersey Mike's has embedded itself in communities through charitable giving. This March alone, as part of the company's fifth annual March Month of Giving fundraising campaign, Jersey Mike's raised more than $3 million for 120 local charities.
Jamba Juice has staked its claim on health and nutrition, an advantage in this day and age. Earlier this year, it expanded its Whole Food Nutrition and Fruit & Veggie smoothie lines, adding the Amazing Greens and Greens 'n Ginger smoothies, while also launching a line of Colada Fruit Refreshers with Coconut Water.
There are plenty of positive signs that seafood fast casual Captain D's has finally revved its engine for future growth. The company experienced a record average unit volume in 2014, and the company's D-Lite Meals menu, a grilled seafood menu that features five meals under 500 calories, is driving customers to the stores. A store redesign that brings more of a coastal vibe to Captain D's has also helped to refresh the brand's image.
Einstein Bros. Bagels
Closing out the QSR 50, Einstein Bros. took a tumble in 2014, dropping seven spots after it saw systemwide sales fall more than $70 million over 2013.