Spicy, bold flavors with an international influence are popping up on menus in all segments. Street food ala food trucks are the rage across the country. And the millennials that drive those trends are always open to trying something new.
It's the perfect storm for a new quick-service brand to emerge from the underutilized ethnic category, foodservice consultants say.
"We've believed for years that there is going to be an emergence" of concepts from the secondary ethnic/Asian category in the United States, said Darren Tristano, executive vice president with foodservice industry consultants Technomic Inc.
According to Technomic's 2009 Top 500 Chain Restaurant Report, the "All Other" segment, in which Other Ethnic is lumped, grew 1.9 percent in 2008 compared to 2007, with sales of $8.2 billion.
He points to Americans' — particularly young adults' — penchant for bold, spicy, and even international flavors as one piece of supporting evidence for a possible emergence. Those flavors have become mainstream, with QSR chains from Taco Bell to Wendy's ramping up their flavor profiles.
The key is developing a concept that delivers the flavor experience in a way that appeals to the younger consumer, he said. Kogi Korean BBQ-To-Go food truck in Los Angeles, for example, suddenly made Korean-barbeque fusion popular by tweeting their next location. The two-hour-long waits have become part of the experience because the fans know they're going to walk away with quality food.
Baby Boomers and Generation X are likely to be more cautious about embracing an ethnic QSR menu, but that shouldn't preclude developers, Tristano said. After all, sushi, a food once considered exotic, is now the focus of several quick-serve chains — and on grocery store shelves.
"If sushi — raw fish — could go mainstream, probably anything could," he said. "So it's good evidence that Americans are looking for (ethnic foods)."
Here is a look at some possibilities in ethnic concepts:
Dean Small, managing partner with Synergy Restaurant Consultants, says he sees Indian-menu concepts having the biggest opportunity in QSR. His company has had a number of inquiries recently from people of Indian descent expressing interest in developing a regional or national chain around Indian fast food.
To work in QSR, the food should be portable, inexpensive and fast, he said. Many Indian concepts, such as San Francisco's Tikka Masala, require sit down meals because they must be eaten with a fork. Masala Bowl, another West Coast concept, offers not only tandoori chicken meals but wraps as well.
New York's The Kati Roll Co., a two-unit concept that specializes in an Indian flatbread known as roti filled with different meats and vegetables, could well be a model for others, Small said. Customers line up out the door for the inexpensive, fast menu offerings.
Small warned that developers will have to address taming the overwhelming smell of curry prominent at many Indian restaurants because the odor is sometimes a turnoff to Americans.
Tristano said another challenge for Indian QSRs to overcome is the preponderance of family-owned, sit-down restaurants with carryout. As with the Chinese restaurant category, these independents take a lot of market share.
Greek and Mediterranean menu concepts are already growing in the fast casual segment, and QSRs could deliver on the price point, Tristano said. The segment offers a variety of focal points, from pita to gyros to falafel — or a combination of those three and more.
Several fast casual concepts focus mainly on pitas, such as Pita Pit and Mr. Pita Sandwiches. Pitas fit into the sandwich category and can be prepared quickly, and they offer lots of topping options.
"Pita is portable, and that's a huge advantage," Tristano said. "People are looking for portable, the convenience factor."
Gyros could do well in QSR because they are portable, but there doesn't seem to be a lot of mainstream acceptance for them, Tristano said. Gyros are popular in Chicago, but they're hard to find in many markets.
Small said developers may have difficulty fitting a gyro menu focus to QSR. Such a concept would likely be limited to high foot traffic areas like food courts. More importantly, the complexity of food preparation will keep the price point up, especially for quality menu offerings.
"You have to be able to put enough value on the plate for the consumer to want to step up and say I'm willing to try an ethnic experience for $5, but are you (giving them) enough value," he said.
International QSR companies have already seen Americans' openness to ethnic menus and have brought chains successful in other countries to the States, brands like Jollibee from the Philippines and Pollo Campero from Guatemala. These chains have been embraced by emigrants from their homeland as well as Americans looking for something new. For example, Pollo Campero openings draw long lines of native Guatemalans and others eager for the spicy grilled or fried chicken.
Jollibee has more than 650 units in the Philippines and is targeting the U.S. West Coast for expansion. The company announced in May it planned seven new units this year, including some on the East Coast. The chain offers burgers with unique spices. According to Technomic's research, the chain had 23 U.S. stores in 2008, bringing in an estimated $18 million in sales.
Tapas, or small plates, are popular in casual dining and could translate to QSR. As mini wraps, they offer a variety of filling and flavor options. Two successful casual-dining chains are Atlanta-based Sugo Restaurant & Tapas, with three units and $14 million in annual sales in 2008, and Chicago's Emilio's Tapas, three units with $10.5 million, according to Technomic estimates.