Build-Your-Own Built to Lead Fast-Casual Growth

CHICAGO, May 21, 2015 /PRNewswire/ -- The fast-casual segment's blistering pace of sales and unit expansion continued in 2014, with annual sales increasing at more than three times the rate of the total restaurant industry-and even faster for the 150 largest brands contained in Technomic's Top 150 Fast-Casual Chain Restaurant Report.

Within this rapidly growing sector, another subcategory of restaurants is rising far above the competition: build-your-own fast-casual concepts. In 2014, restaurants with a build-your-own format, which moves consumers down the make line and allows them to customize their meals, increased sales twice as fast as made-to-order fast-casual brands. The former reported a collective annual-sales gain of approximately 22 percent, compared with an 11 percent increase for the latter, according to data collected for this year's Top 500 Chain Restaurant Report.

"Consumers certainly like the freshness, food quality and prices at made-to-order fast-casual brands, but there is something about the build-your-own format that they prefer significantly," said Darren Tristano, executive vice president of Technomic. "More customers, especially Millennials, see the personalization and engagement that come in a build-your-own menu offering as the greatest differentiator in dining out. These trends are likely to lead fast casual's growth for years to come."

The fast-casual industry grew its annual sales approximately 13 percent last year to $39 billion, Technomic found. While that is a relatively small share of the total restaurant industry's $466 billion in annual sales in 2014, fast casual's growth rate dwarfed the total industry's annual increase of 3.8 percent. Fast-casual brands also increased their unit count 9 percent in 2014, far faster than the 1.3 percent gain in new locations for the total restaurant industry.

All menu categories in the report showed sales and unit growth, but several clusters showed interesting developments:

• The pizza category, led by fast-growing chains like Blaze Pizza, had the largest annual-sales gain of 22 percent in 2014. Store count growth, which increased 27 percent, is driving much of fast-casual pizza's sales performance, helping those brands steal market share at lunch and dinner. As new players enter the segment, expect several more years of rapid growth for fast-casual pizza.
• The specialty cluster, which comprises categories like salad, Mediterranean and barbecue, posted an approximate 20 percent increase in sales and a 13 percent gain in units.
• Like the bakery-cafe segment, which grew sales 6 percent and locations 5 percent, the Mexican category is one of fast casual's most developed and mature clusters, yet it posted gains of about 18 percent in sales and 6 percent in locations. Chipotle Mexican Grill continued to lead the way with a nearly 28 percent sales increase in 2014. While still expanding and taking market share from quick-service brands, fast-casual Mexican chains and bakery-cafes are likely to grow slower in the coming years than specialty concepts in emerging segments.

The Top 150 Fast-Casual Chain Restaurant Report provides Technomic's exclusive rankings, analysis and profiles of the leading fast-casual chain restaurants, helping readers understand emerging trends and players in one of today's fastest-growing segments.

To purchase or learn more about this and other industry reports from Technomic, please visit Technomic.com or contact one of the individuals listed below.

Contacts:

Press inquiries: Darren Tristano, (312) 506-3850, [email protected]

Purchasing details: Patrick Noone, (312) 506-3852, [email protected]

Data requests: Chris Urban, (312) 506-3929, [email protected]

About Technomic

Only Technomic delivers a 360-degree view of the food industry. We drive growth and profitability for our clients by providing the most reliable, consumer-grounded, channel-relevant data with forward-looking strategic insights. Our services range from major research studies and management consulting solutions to online databases and simple fact-finding assignments. Our clients include food manufacturers and distributors, restaurants and retailers, other foodservice organizations, and various institutions aligned with the food industry.

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SOURCE Technomic Inc.

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