Can't Touch This

Fast casual concepts lead the industry despite fierce competition. Here’s the secret to their success

In the quest to be the Next Big Thing, wannabe restaurateurs describe the ideal concept as, “You know, like Chipotle.”

Burritos aside, what they’re really envisioning is a fast casual concept with a simple menu and fresh, high-quality food at a low price that can be stamped out on every street corner in America.

They have good reason for wanting to be in the league of Chipotle Mexican Grill, the most successful fast casual concept in the country.

“There will certainly be some trading (of sales) in some of these concepts and, as a result, sales volumes will decline. But overall, fast casual is still outpacing the rest of the industry.”

— Technomic’s Darren Tristano

Though no longer killing it like it did in the past decade, fast casual remains the industry’s best performing and most influential segment. It’s grown by 11 percent over the past five years, compared with a 1.4 percent increase for traditional fast-feeders and a 0.5 percent decrease for full-service restaurants, according to Technomic, which tracks restaurant sales and unit growth. Today, roughly 14,000 fast-casual outposts dot the U.S. landscape, says foodservice research firm, The NPD Group.

“A big reason for this is that the fast casual is smaller and gaining popularity and stealing share,” says Technomic’s Darren Tristano, who estimates sales for all fast casual restaurants reached $28 billion in 2012, still only a small portion of the $205 billion racked up by limited service restaurants for the same year.

Yet rapid growth—much of it from copycats—is becoming difficult to maintain, notably in the $3 billion “better burger” category dominated by 1,100-unit Five Guys Burgers and Fries and 200-unit Smashburger. These chains and their smaller rivals—Mooyah Burgers, Fries and Shakes, The Habit Burger Grill and Umami Burger—are already beginning to steal share from one another.

“There will certainly be some trading [of sales] in some of these concepts and, as a result, sales volumes will decline,” Tristano adds. “But overall, fast casual is still outpacing the rest of the industry.”

David Farkas is a Cleveland-based freelance writer who has been on the chain gang for more than 15 years.


There’s No Waffling… 

When it comes to these sandwiches

Necessity is the mother of wacky inventions, like Bruxie Gourmet Waffle Sandwiches, a four-unit concept that’s generating more than $8 million a year. But bringing the typically sweet breakfast treat into the sandwich sphere wasn’t an easy sell. Owner Dean Simon wanted a return on the money he had poured into a waffle-mix company. Trouble was, nearly every chain operator he approached saw waffles as a breakfast item—and passed.

Undeterred, Simon tapped family, friends and business partner Chef Kelly Mullarney to help raise $400,000 to launch the first Bruxie in a 420-square-foot former burger-and-ice-cream stand in Old Towne Orange, Calif. His rationale: Americans want an unconventional sandwich, even if they don’t know it yet.

When Bruxie opened in the fall of 2010, the fast casual concept generated enormous publicity for its fresh take on the standard sandwich. Unorthodox ingredients found a home next to standard, and diners could try anything from short ribs and prosciutto to smoked salmon and buttermilk fried chicken folded into freshly made Belgian-style waffles.

“Ambassadors” are stationed near order windows to explain the unique sandwiches to long lines of customers shelling out about $10 for a sandwich and proprietary soft drink (made with cane sugar).

A year later, Bruxie scored on Yelp as the second-highest rated restaurant in the country. It also rang up more than $2 million in annual sales.

“The first location exceeded all expectations,” says Simon, who expects to bring the number of locations to at least six in southern California this year.


Fast Takes 

CantTouchThis1

Four Points for Carving Out a Concept 

What does it take to pull off a successful fast casual concept?

1. A platform with a grounded flavor profile and consistent execution.

2. Proper equipment. “Select equipment that emphasizes flavor,” advises Consulting Chef Andrew Hunter, former vice president of culinary development for Wolfgang Puck Worldwide.

A rotisserie, for example, to caramelize meats and vegetables. “The thing I like about it is that chicken or salmon can be the canvas on which you might use a smoky barbecue sauce for a Southern take, tandoori spices for Indian or rosemary and garlic for a California-style dish,” he says.

3. A defined cuisine. The bandwidth of flavor profiles is narrowing, according to Technomic’s Darren Tristano. “A lot more regional Asian—Indian, Thai and Korean—will emerge,” he predicts, citing Bibigo, a Korean fast casual in Los Angeles.  

4. Know your audience. Baby boomers accounted for 23 percent of visits to fast casual restaurants between 2007 and 2012, says the NPD Group. On the flip side, millennials made up just 9 percent.