Quick Casual and Bodacious

Chains that are developing today do it fast and reasonable. An example of a casual chain is Applebee’s with more than three new locations opening each week in the past months and years. Subway on the quick service side opens more than 30 locations each week in the U.S. alone. We have just begun to look at this, but looking at the new counts of developing chains we estimate new openings are 55-65% to be quick service or fast casual, 30-35% casual or family style and 5-10% upscale. The 100 seat family or upscale restaurant is showing signs of a disappearing profile. To develop quickly today we are seeing full service locations that are large and bodacious or small to mid-size with a quick service approach.

New restaurants and their nature in the beginning

Here in the office for the past 10 years or so we've been finding, sorting and qualifying new restaurant locations. Most new openings are not chain restaurants but independents. On the average, we publish more than 750 new restaurant openings per week. More than 80% of what we report on are independent, single unit operators. The remaining 20% are chain operators. So rest assured chains are not taking over the world. Not yet.

How come the chains start with such a bang compared to independents? From our perspective it comes down to a sense of posture and respect. We can often tell in the first phone call if someone will be out of business within a year. We believe it's congruent with what a customer sees and feels as they drive into the parking lot and enters through the front door. Sure, clean restaurants and quality design provide a basis but if the phone is not answered with a pleasant indulgent confidence the rest of the operation can follow suit.

If you've ever called a large chain restaurant and asked for the manager (even if the location is brand new or pre-opening), the host, wait person, cook or other line level employee will ask you to "please hold on" and then go and get the manager without much quizzing. Typically he will pick up the phone and patiently answer your questions. Almost nothing is off limits.

Our view is many new independent operators take a filtering approach towards callers which can sometimes alienate future customers.

Special analysis of succeeding restaurant concept types

In taking a close-up look at the type of restaurants that are emerging over the past months there seems to be a common principle: Allow the customer to order a meal or a significant appetizer for fewer than 10 dollars (excluding beverages and other add-ons). We have found chains with a menu mix that welcomes customers of all shapes and wallet sizes is what’s working now.

It seems that restaurants that can accomodate a table of four and be happy that two folks ordered only an appetizer, one an entree and dessert, and the other only soup are the clear winners in todays environment.

New York Restaurant Show

We just got back in the office today after three days at the NY Restaurant Show at the Javits. It was extraordinarily busy. I believe the expo company did a more than sufficient job of pre-show marketing. There was alot of food offered. So much so, you could not walk through many aisles for hours with comfort if you wanted to do business and not just graze. We noticed a heavy amount of cookies and cakes. Seems coffee type cakes are all the rage right now.

We saw an amazing product out of Japan. It was a cooler. A sort of reach-in refrigerator like you get your soda from in your local convenience store. Anyway, they grabbed a bottle of un-opened coke out of this cooler and then opened it. Then it magically turned the soda to a slushie type of consistency. Some sort of smooth ice chunks. They said it's hugely poplar in Japan. The company is called Magiquoal. I personally shook a bottle of un-opened water and watched as ice magically appear within the bottle. I imagine they could sell well here. Picture an ice infused slushie in the hot summer with no cup and ice needed.

The show also had a night club area in the back corner of the show. Kind of classy and lots of alcohol sampling going on. This show seemed to have more alcohol presence overall than in the past few years. Lots of exotic liquors and Belgium beers.