Chain Restaurant
menu prices continue to rise up 3.8% in April on a year-to-date basis, all the
while wholesale food prices were up 3.9% year to date, according to the Bureau of Labor Statistics.
It’s looks as if restaurants are doing only slightly better than
wholesale food prices. That is a good
start as all restaurants continue to accrue transitory cost. Those transitory cost will continue to go up
and down for at least the next 36 months. So, who is after restaurant customers? Companies that have positioned themselves by
evolving business models better than most legacy chain restaurants according to
Steven Johnson, Grocerant Guru® at Tacoma, WA based Foodservice Solutions®?
It’s time that chain restaurants should care?
Why, simply put they are losing customer
relevance with customers and according to Johnson, in fact same-store traffic was down by 9.4%
during March on a two-year comparison basis.
That’s not good.
While food consumers are a highly
fragmented group there are universal commonalities creating channel
disruptions. Consumers want, what they want, when they want it! Increasingly
they want Grocerant niche Ready-2-Eat and Heat-N-Eat fresh food meals and meal
components.
Waiting for the ‘old days’ to come back
is not a strategy that will work. Today, it is all about the consumer buying
what the type of food they want, where they buy it ,and how they buy it is in
flux. You can buy food from large format food retailers the ilk of Safeway
Lifestyle stores, Kroger, Walmart, Ikea, or Smaller Format retailers like
Trader Joe, McDonald’s, Burger King, Dollar Stores, Walgreens, and even fast
casual restaurants.
Regular readers of this blog know that
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 channel: convenience stores, chain drug stores, restaurants,
grocery stores, club stores, vending and even more non-food retailers like
dollar stores and most cost less per meal than at most chain restaurants. That
helps drive relevance.
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 restaurant’s goal is simple feed one meal at a time in
the restaurant while protecting and edifying the brand.
Historically chain restaurant leaders
have denied the credibility of start-up competitors as non-relevant. The simple
fact is convenience stores, grocery stores service deli’s, and dollar stores
are not start-ups? They are not raising prices on fresh prepared food they are
introducing more new meal component options with full flavor and at very
competitive price points. Business
models evolve. Is your brand edifying
your menu, footprint, and messaging with today’s relevance?
Foodservice Solutions® specializes in
outsourced business development. We can help you identify, quantify and qualify
additional food retail segment opportunities or a new menu product segment and
brand and menu integration strategy. Foodservice Solutions® of Tacoma WA is the global leader in the Grocerant niche
visit Facebook.com/Steven Johnson, Linkedin.com/in/grocerant/ or twitter.com/grocerant
