Chain Restaurants Continue to Stumble over Change Why

Foodservice Solutions®, Grocerant Guru® Steven Johnson stated “The restaurant industry is not an industry known for trying to be first as in fastest to market with an ideation, food or technology advance. In the United States the larger the chain in almost all cases the more slowly they are to adopt something than a smaller chain or independent restaurants will.  Chain restaurants goal is simple feed one meal at a time in the restaurant while protecting and edifying the brand.”

Thus, the line between restaurants and food retailers is growing ever thinner. The fight for America’s food dollars continues to intensify as consumers find fresh prepared Ready-2-Eat food options at a wide and growing array of outlets across almost every retail channel including the ilk of convenience stores, chain drug stores, restaurants, grocery stores, club stores, vending and even more non-food retailers like dollar stores. 

Food manufacturers, retailers, and restaurants worry about choice overload, consumers have embraced their new choices and show no signs of returning to the old ways. This fight is taking place in what is called the grocerant niche. In short there is an intense battle for an increase in Share of Stomach according to Johnson.

Battle for Share of Stomach

Historically chain restaurant leaders have denied the credibility of start-up competitors as non-relevant. The pizza sector is a great example; evolving from family dinning independents to national chain of “Red Roof” Italian, then to delivery only outlets and now take-N-bake is garnering market share in the pizza sector. Today, furniture store IKEA has a $2 Billion US dollar grocerant niche Ready-2-Eat and Heat-N-Eat business that is driving growth of the legacy furniture retailer.

At the intersection of the consumer, fresh prepared food and technology we fine that consumer eating behavior is evolving and is now beyond the control of traditional food marketers. Millennials & Gen Z consumers are driving change in eating habits and demand more ‘clean food’ according to Johnson.

Evolving culture and lifestyle, demographics along with the new uncertain economy are all putting pressure on the American food consumer: Demands of work, economic shrinkage, demands of raising a family, commuting, social interaction, kid’s after-school activities, all contribute to a food marketplace where convenience vies with price over legacy brands.

Recent advances in food packaging and new points of non-traditional food distribution have empowered consumer choice, and Americans are embracing these choices even as legacy marketers cringe. Who’s after restaurant food dollars simply put everyone.

Why should you care if Walgreens is selling fresh prepared Ready-2-Eat and Made-2-Order sandwiches? Why should you care if Whole Foods, Trader Joe’s, Safeway and Wegmans are selling Ready-2-Eat and or Heat-N-Eat fresh pizza?  Why should you care if Coinstar is selling Seattle Best Coffee at 1,000 locations for $1.00?

The retail food world is evolving at an increasing pace filled with innovation in food, portion size, points of distribution, and quality fresh prepared meal solutions.      The price, value, service equilibrium is resetting in retail foodservice.   In order to edify the brand and reinforce consumer relevance restaurateurs leverage Foodservice Solutions® 5P’s of food marketing: Product, Packaging, Placement, Portability and Price.

Many legacy food retailers continue to practice brand protectionism, stifle the brand while diminishing consumer relevance.  The consumer is dynamic not static.  Brands must be dynamic, evolving with the consumer.  Four years of watching other retail sectors thrive should be long enough. Success in the restaurant world is no longer simply about what happens within your 4 walls. 

Steven Johnson is the Grocerant Guru at Tacoma, WA based Foodservice Solutions®, with extensive experience as a multi-unit restaurant operator, Food Brand Strategic Advisor, brand / product positioning expert and at public speaking. Facebook.com/Steven Johnson, Linkedin.com/in/grocerant ortwitter.com/grocerant Steve@FoodserviceSolutions.us