Saturday, September 14, 2024

What Do Chili's, Panera Bread, McDonald's, and Wawa All Have in Common?

 


The grocerant niche continues to drive the evolving landscape of foodservice, the once-clear lines between grocery stores, convenience stores, and restaurants have blurred. The new battleground for the age-old question, "What's for dinner?" is no longer confined to the grocery aisle but has expanded to the drive-thru lanes and delivery apps. Leading the charge are brands like Chili's, Panera Bread, McDonald's, and Wawa, which are collectively reshaping consumer behavior and posing an increasing threat to the foundation of the legacy grocery business.

The Rise of Convenience-Driven Dining

The modern consumer's lifestyle is defined by speed, convenience, and the desire for minimal cleanup after meals according to Steven Johnson grocerant guru® at Tacoma, WA based Foodservice Solutions®. The fast-paced nature of today’s world leaves little time for meal planning, grocery shopping, and home cooking. Enter Chili's, Panera Bread, McDonald's, and Wawa—brands that have become the go-to solutions for dinner. These companies have capitalized on the growing demand for ready-to-eat meals that can be picked up or delivered with minimal effort.

·         Chili's has leveraged its "Chili's To Go" platform, enabling customers to order online and pick up their meals without ever leaving their cars. Their streamlined curbside pickup service has become a key component of their business model, contributing to an 18% increase in off-premise sales in 2023.


·         Panera Bread has embraced delivery and rapid pickup options, appealing to health-conscious diners with their diverse menu of fresh salads, soups, and sandwiches. With over 50% of their sales now coming from off-premise channels, Panera is no longer just a café but a serious contender in the dinner market.

·         McDonald's has perfected the art of the drive-thru, with innovations like digital menu boards and app-based ordering that have slashed service times. Their drive-thru sales account for nearly 70% of their total revenue, making them a dominant force in the quick-service industry.

·         Wawa, traditionally known as a convenience store, has transformed into a foodservice powerhouse with its made-to-order hoagies, freshly brewed coffee, and warm meals. Wawa’s ability to deliver customized, fresh food quickly has made it a favorite among consumers looking for a fast and satisfying dinner solution.



The Shift Away from Legacy Grocery Stores

What do all these brands have in common? They offer consumers an alternative to the traditional grocery shopping and cooking experience. The convenience of ready-to-eat meals, combined with the ease of delivery and drive-thru options, has made them a preferred choice for time-starved families and individuals.

According to the Food Marketing Institute (FMI), the share of food dollars spent on restaurants has increased from 46.1% in 2010 to 54.4% in 2022. This shift reflects a broader trend of consumers opting for meal solutions that require less time, effort, and cleanup. Legacy grocery stores, once the dominant player in the dinner market, are now facing stiff competition from these fast-casual and quick-service brands.

Delivery: The Game-Changer

The explosion of third-party delivery services like DoorDash, Uber Eats, and Grubhub has further accelerated this trend. Consumers can now have a hot meal from their favorite restaurant delivered to their door in under 30 minutes—often faster than it takes to drive to the grocery store, shop for ingredients, and cook at home.

Chili's, Panera Bread, McDonald's, and Wawa have all invested heavily in delivery infrastructure. For instance, Chili's partnership with DoorDash has allowed them to expand their reach beyond their physical locations, contributing to a 20% increase in delivery sales in 2023. Panera Bread’s loyalty program, integrated with their app-based delivery service, has grown to over 50 million members, driving repeat business and customer retention.


No Cleanup Required

One of the most compelling advantages these brands offer over grocery stores is the promise of no cleanup. After a long day, the last thing most consumers want to do is cook a meal from scratch and clean up the kitchen afterward. With the convenience of picking up a meal from McDonald's or having Panera delivered, consumers can enjoy a delicious dinner without dirtying a single dish. This no-fuss approach is particularly appealing to younger consumers, including Millennials and Gen Z, who prioritize experiences and convenience over traditional cooking.

The Threat to Legacy Grocers

The impact of these trends on legacy grocery stores cannot be overstated. As more consumers turn to restaurant-prepared meals for dinner, grocery stores are losing their grip on the evening meal occasion. While some grocery chains have tried to adapt by offering more prepared foods and meal kits, they struggle to compete with the convenience and speed offered by drive-thru and delivery options.

In 2023, grocery store sales growth slowed to just 1.2%, while sales in the foodservice sector grew by 7.6%, according to the U.S. Census Bureau. This divergence underscores the growing threat that brands like Chili's, Panera Bread, McDonald's, and Wawa pose to the traditional grocery business.


Think About This: The Future of Dinner

The future of dinner is increasingly being shaped by the convenience and speed offered by restaurants with robust drive-thru and delivery options. As Chili's, Panera Bread, McDonald's, and Wawa continue to expand their off-premise capabilities, legacy grocery stores must innovate or risk becoming obsolete in the dinner market.

Consumers have spoken, and their preference is clear: they want meals that are fast, convenient, and require no cleanup. The question for the grocery industry is whether it can evolve quickly enough to meet this demand, or if it will continue to cede ground to the likes of Chili's, Panera Bread, McDonald's, and Wawa.

The dinner table is set, and the competition is fierce. Will legacy grocers find a way to reclaim their place, or is this the new normal where fast food and quick-service restaurants reign supreme? Only time will tell, but one thing is certain: the battle for "What's for dinner?" is just beginning.

Invite Foodservice Solutions® to complete a Grocerant ScoreCard, or for daypart and product positioning growth assistance, or call our Grocerant Guru®.  Since 1991 Foodservice Solutions® of Tacoma, WA has been the global leader in the Grocerant niche. Contact: Steve@FoodserviceSolutions.us or 253-759-7869

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