Tuesday, December 8, 2015

Chain Restaurant Brand Protectionism Hurts Sector

When the consumers evolve brands specifically legacy chain restaurants must evolve as well according to Foodservice Solutions® Grocerant Guru®.   Every restaurant brand wants incremental customer counts month after month and year after year.  Customer count growth is the most important data point followed by industry insiders it is more important that same-store sales growth.  It is a benchmark of success and the clearest way to validate that what your brand is doing is working.  Simply put: more customers positive fewer customers negative. 

So, when TDn2K’s Black Box Intelligence through The Restaurant Industry Snapshot, based on weekly sales from over 22,000 restaurant units and 120 brands representing $55 billion dollars in annual revenue reported November 2015 restaurant sector customer counts down once again an alarm bell went off at chain headquarters and within offices at franchises groups you can be assured.  

The report found that ““The average same-store traffic growth for October and November was -2.2 percent, compared with an average -1.1 percent for the first nine months of the year.” This continues a trend of negative same-store traffic counts since 2009 that is SEVEN years.  

Clearly the alarm bell was hear at: Black Eye-Pea, Papa John’s, Ruby Tuesday, Tim Hortons, Joe’s Crab Shack, Bojangles’ all of which have closed or had franchise groups close units within the past two months. Foodservice Solutions® regular blog followers know that brand protectionism does not work.  Doing the same thing today the say way, with the same mind set, same brand values as you did 25 years ago is a recipe for market share capitulation, customer migration, and franchise discontent. 

Convenience Stores and Grocery Retailers have evolved, garnered new customers with grocerant niche Ready-2-Eat and Heat-N-Eat fresh prepared food.  Leveraging Mix and Match meal component bundling C-store and Grocery Delis continue to drive top line growth and bottom line profits.  What’s more they are growing year over year customer counts.  Does you restaurant have the grocerant niche focus?  Do you understand the role of product, price, and freshness in the consumer mind-set today? 

Restaurant brand protectionism has hurt the entire restaurant sector according to BlackBoxIntelligence. Seven years is not a fad, it is a trend.  Don’t get trapped thinking that the ‘good old-days’ are coming back anytime soon.  There is a reason customers migrate.  Are you looking a customer ahead?  

Success does leave clues for grocerant niche clues it time to consider Foodservice Solutions® grocerant niche industry leaders since 1991. Contact: Steve@FoodserviceSolutions.us   Invite Foodservice Solutions® to complete a Grocerant Scorecard or a Grocerant Program Assessment.  

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