Consumer tastes change, but you already knew that. That’s the nature of the food industry. Food has evolved from being just about taste to its effect on your body and now to its impact on the environment. The change is driven by a consumer that is becoming more aware of their power. They have a choice, and they will exercise their right to choose who they patronize.
The restaurant industry is no stranger to change. Smart owners and managers know that they need to stay true to their core values but always look to the future. Right now, the future is digital.
What is a Quick Service Restaurant?
What does QSR mean? QSR is an industry term for a quick-service restaurant, and most people just call them a fast food restaurant. The more recognizable brands in the industry are those like McDonald’s, Burger King, and In-and-Out Burger. There are smaller regional and even single location QSRs too within the market.
What a QSR does is in its name; it serves food quickly. The type of food served can be anything, but it has to be quick and easy to prepare. The menu options in QSRs are limited in nature and rarely change. The design of QSRs is focused on being functional, so they are usually furnished with plastic seating and tabletops along with fluorescent lighting. Most QSRs do not provide table service.
A Growing QSR Market
According to Statista, the American QSR Market generated $273 billion in 2019. In 1970, the industry was only worth $6 billion. It is estimated to have grown 3.8 percent annually between 2015–2020. The Global market is expected to generate $570 billion. The total number of QSRs operating in the US is just over 200,000, with California holding the largest amount of 30,0000 plus in 2018, and Wyoming at the lowest with 354 units. The QSR segment accounts for more than half of total restaurant sales, serving over 50 million Americans daily.
Part of fast food’s disadvantage has been the limited menu. In fact, most fast foods sell the same products. Fast-casual restaurants, on the other hand, offer affordable meals with more diversity. The prominent brands in the fast-casual restaurant space are Chipotle Mexican Grill, Shake Shack, and Panera Bread.
Changing Consumer Demands
Consumers no longer accept being told what to eat and when to eat it. These changes in consumer habits have led fast-food restaurants to make significant changes to their operations. Here are some consumers demands that fast-food restaurants have been forced to take note of:
- Consumers have become more health-conscious. They count calories and only want to eat diet-specific meal plans. Restaurants have adapted by displaying nutritional facts and serving vegan meals or meatless burgers at the least.
- Environmentally conscious consumers are demanding to know where their food comes from, and need to be assured that the food was farmed responsibly. Large fast-food chains have actively educated consumers on their food sourcing methods as part of their marketing strategy. Smaller chains have shifted their supply chains to source only from local farms.
- There has been a rise in demand for delivery service. Consumers want to have meals at their own time and location. This has resulted in the growth of third-party delivery services like Grubhub and Uber Eats.
- In order to anticipate demand and operate efficiently, fast food restaurants have had to make strides in digital advancements. This includes apps for online and mobile ordering, loyalty programs linked to digital user accounts, digital ordering kiosks, free Wi-Fi, etc.
- The core fast-food meals were meant for eating later on the day; for breakfast, the menus had limited to offer, if anything. Realizing that this was potentially a new revenue source, fast-food chains have been expanding their coffee and breakfast menus.
Considerations for Smaller Chains and Local Businesses
Considering the big names in the industry, you may find it hard to compete with their legacy and financial power. Nonetheless, there is a way that a small chain or a single restaurant can survive in this market. Some of the points above can give you an insight into how they operate and what you can do to be just as good.
Even under the shadow of the giants, you can carve yourself a niche in the market. Focus on the things that will make you stand out. This could be high-quality service, location, localized menu options, personality, or even the ability to adapt quickly.
Food for Thought
QSRs should continue to dominate the restaurant market. Consumers will always have a need for affordable, quick meals. What you need to focus on is becoming efficient in it, and most importantly, standing out from the competition.