Is it just me or has December felt like an entire year’s worth of news in the limited-service world? From Captain D’s and Qdoba being sold to Papa John himself stepping down, it’s been a wild couple of weeks.
I’m going to call 2017 “The Year of the Sale.” Don’t expect that to change. It’s pretty clear that restaurant brands are prime targets for private-equity groups. Could Chipotle be the next takeover target? It’s sinking stock price does make it an intriguing option. Depending on how you look at it.
Whether that happens or not, 2018 is unquestionably going to be an interesting year.
But for now, it’s time to look back. Here were QSR’s top-read stories of 2017.
12 Fast Food Trends for 2017
This is a fun one to check out and see what we got right (and terribly wrong). Delivery on steroids was one topic with a check mark. I’m not as sure about kombucha. And for additional reading, be sure to dive into our 2018 edition.
The 40/40 List
For the first time, the QSR staff got together and picked the 40 fast casuals with fewer than 40 units that we’d put our money on. These limited-service brands ranged anywhere from two-unit Mimi Cheng’s to 35-unit Luna Grill. With a little bit of everything in between. Fast casual is a dynamic and ultra competitive segment right now. These brands are the ones we expect to keep growing and redefining the industry. Shameless plus: There’s another edition coming soon.
The QSR 50
As always, the QSR 50 returned to rank and break down the top performers in the $234 billion limited-service restaurant industry. McDonald’s, yet again, was No. 1, with really zero signs of slowing down. The fast-food titan reported systemwide sales north of $36 billion in 2016. Check out the chart to see who’s rising and falling, from unit count to AUV to category and franchised stores.
Subway Reveals Major New Brand Look
Anytime a chain with 45,000 units says “the most extensive launch in company history,” it’s big-time news. In this case, Subway announced its design of the future, a Fresh Forward model that showcases the brand’s dedication to ingredients and the customer experience. Chief among the changes, which will take multiple years to rollout: a “S” Choice Mark, fresh vegetable display case, new floor coverings, LED lighting, seating package, and much more.
A&W Hits the Comeback Trail
Did you know The Atlantic once predicated A&W, which has been around some 98 years, would disappear? The nostalgic side of you probably thinks that’s crazy. But truth is: A&W was in rough shape toward the tail end of its Yum! Brands life. When the chain split from the fast-food company, which also owns KFC, Taco Bell, and Pizza Hut, it landed in the hand of a core group of franchisees. They asked Kevin Bazner, who worked with A&W from 1985–2002, to return as CEO. This was 2011. Six years later, A&W is back. In February, A&W announced that it was growing for the first time in a decade. Systemwide revenue and locations were on the rise. Fifteen U.S. and 21 international restaurants opened in 2016 and 20 and 25 stores, respectively, were scheduled to debut this year. Sales at stand-alone stores rose more than 28 percent in the last five years. Even co-branded locations grew 20 percent. Expect another year of growth in 2018.
20 of the Most Influential Restaurant Leaders
Ever since QSR published its first issue back in September 1997, the limited-service restaurant industry has undergone seismic changes. Many factors have shaped the evolution of the highly competitive, influential, and fast-changing limited-service industry in the last two decades. But perhaps none has had a greater impact than the people leading the charge—those building the empires, setting the trends, training the leaders, and engineering the massive turnarounds that come to define the industry of today and tomorrow. We took a look at 20 of the most influential over the past two decades.
CEO Suzanne Greco’s Fresh Look for Subway
Suzanne Greco’s brother, Fred DeLuca, started the sandwich behemoth more than 50 years ago. Now, it’s Greco’s chance to take the brand to the next level. And, as mentioned earlier, this a very interesting and transformative time for Subway. From its new look to slowing sales, the chain has an interesting future to grapple with. Greco met with QSR’s editor, Sam Oches, at a restaurant in Orland to chat about how Fresh Forward is positioning Subway to be more competitive for the future—and how it’s helping her carry on the legacy of her late brother.
Focus Brands Blazes a Path for the Future
Over the past couple of years, Focus has shed its vestigial systems and emerged as a leaner, meaner company. It has new, tech-inspired digs and a collaborative mindset that’s driving some of the industry’s most recognizable brands forward. Moe’s Southwest Grill, McAlister’s Deli, Schlotzsky’s, Auntie Anne’s Pretzels, Cinnabon, and Carvel are part of Focus’s portfolio. Many of these changes have been spearheaded by CEO Steve DeSutter. What’s the next step? The industry would be wise to pay heed.
The 2017 Drive-Thru Study
Say what you will about curbside and delivery, drive-thru is still king across America. QSR’s latest edition of the Drive-Thru study took a look at the operations of some of the industry’s top brands, breaking down everything from speed of service to accuracy to which employees smile the most. The results showed that some companies are leading the charge and improving each year, harnessing technology and training to get an edge on their competitors. Others … we’ll let’s just say there’s progress to be made.
The 2017 Growth 40
Instead of brands, the Growth 40 takes a look at the best markets, large, medium, and small to open your next restaurant in. This year, Phoenix, Arizona, topped the large-market list for a number of reasons. QSR broke it down in a chart that shows projected population percent change, total restaurants open per 100,000 people, forecasted growth, and more. We also chatted with executive from around the business to see what they think about the changing landscape.
9 Best Franchise Deals
Franchising remains an integral part of the limited-service industry. These nine brands, based on a series of data, are the top performers. Key financial metrics like startup costs, sales trends, overall fee load, and return on investment, played a role. As did topics like: Are franchisees happy? Is the brand on trend and relevant? Is corporate truly committed to the success of its franchise partners or just blowing smoke? Check out which brands made the list.
61 of America’s Most Innovative Menu Items
I have to give kudos to my editor, Sam Oches, for rounding up 61 menu items from around the nation to feature. The painstaking process resulted in some off-the-wall dishes, like The Carving Board’s Spaghetti and Meatballwich, or Zoup!’s Rattlesnake Stew. Limited service has never been so … weird (great).
Panera Sold for $7.5 Billion to Krispy Kreme Owner
The second-largest acquisition in the history of the restaurant industry. Yup, that was a big deal when it broke in November. For some, it was hard to imagine Panera being sold since it’s been such a stock market darling in recent years. That goes to show you, though, if the price tag is right pretty much everybody is on the block. Panera going to JAB could mean a lot of things. My guess: Expect to see the brand overseas at some point. The future is exceptionally bright for Panera. It’s a digital leader with a business model proven in every market across the nation.