Thursday, July 25, 2013

Quick Service Restaurants Face Food Fight

Only Wall Street financial analysts could spin a prolonged daunting food sales market share fight as good news.  However this week when Wendy’s struggling to maintain year over year same store gains system wide presented a plan to sell units as a way to generate profits Wall Street financial analysts praised company leadership.  All the while Wendy’s franchisees continue too capitulate market share to other QSR’s, C-stores, and new non-traditional fresh food retailers. How does selling stores boost profits at your restaurant? Restaurant industry big data points to “big disrupters” on the way for QSR’s.

McDonalds on the other hand put a different spin on things.  Leveraging Big Data and positive same store sales CEO Don Thompson noted that they are “gaining market share even as sales shrink” and that is winning.   I have to agree.  The industry undercurrents of change first identified by Foodservice Solutions® and mirrored in the Big Data findings of McDonalds are all grocerant niche related.

Including in the findings Thompson called “the informal eating out market” we called it the non-traditional ready-2-eat and heat-N-eat fresh prepared food aka grocerant niche.  Thompson pointed to casual dinning restaurants. We point to companies the ilk of Panera Bread once seating only are now adding drive-thru's, lowering price points and bundling meal options ala QSR’s and the grocerant niche.

QSR’s are increasing trapped by self-imposed legacy brand protectionism practices and footprint malaise. All of which is a contributing to store level cost pressure that new non-traditional competitors simply are not burdened with. The current price value service equilibrium for many legacy QSR’s and legacy food retailers is simply unsustainable at the store level.

McDonald’s big data drew focus on “heightened competitive activity” and “non-traditional competitors” specifically and for the first time “ready-to-eat supermarket meals”, and convenience stores.  Regular readers of this blog know Foodservice Solutions® was first leveraging big data to identify, quantify, and qualify these new competitive undercurrents of the evolving fast fresh food world.

While many legacy restaurant chains continue to mention, blame or justify sales growth on continued “economic uncertainty”.  The ready-2-eat and heat-N-eat fresh prepared food niche continues to garner momentum, solid top line sales YOY growth, customers, bottom line profits, and new unit growth. Legacy QSR’s are facing a fight for share of stomach with new well- funded non-traditional competitors.  Is your brand waiting to see what happens or are you edifying your brand and footprint with consumer contemporized relevance?

Outside eyes can deliver top line sales and bottom line profits.  Invite Foodservice Solutions® to provide brand and product positioning assistance or a grocerant program assessment. Since 1991 Foodservice Solutions® of Tacoma, WA has been the global leader in the Grocerant niche for more on Steven Johnson and Foodservice Solutions® visit or 

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