The fast casual segment remains the top performer in the restaurant sector, and will continue to lead activity and change. The segment, typified by the likes of Chipotle, Noodles & Company and Zoe’s Kitchen, is providing offerings that are consistent with a number of important consumer trends. Despite charging higher prices than many quick serve restaurants, fast casual chains receive high marks from customers from a value point of view, said Bob Bielinski, managing director of the Restaurant Industry Practice for CIT Corporate Finance at CIT Group.
“Fast casual chains are changing the landscape of the restaurant sector through customization and better food quality, and by creating more comfortable environments,” said Bielinski. “These chains are seeing growth because they are rewriting the rules of the business and are adept at meeting consumer needs, while continuing to add units and grow sales.”
Many quick serve chains and casual dining restaurants are reacting by remodeling restaurants, improving the quality of their food and utilizing new technology. As a result, these companies will likely seek financing to invest in their restaurants and improve their overall value proposition.
Bielinski offers other insights and takeaways on the U.S. restaurant sector, including:
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