News

2 studies yield 2016 and 2017 chain winners and losers

December 13, 2016

As the year that was 2016 heads into the history books, year-end awards and year-beginning trend predictions have begun in earnest. For instance, Technomic has published the winners in its Consumer Brand Metrics study, which polled consumers on 142 leading chain restaurants in the U.S.  

Meanwhile, Fitch is making  predictions about restaurant chain winners and  losers in the year ahead in its 2017 Outlook, which strongly suggests that the ultra-competitive restaurant segment will continue to play a rough-and-tumble game in a world of rapidly changing and ever-more-important diner demands and preferences. 

Technomic 100,000-consumer visits study and poll 
The research and analysis company pored over data from more than 100,000 restaurant visits to determine its annual Chain Restaurant Consumers' Choice Awards, which will  be formally presented in early January at a conference in Newport Beach, California. This year's winners in quick-service and fast casual sectors are listed below.

Best of QSR 
•    Great taste: In-N-Out Burger
•    Best at bringing them back: Papa Murphy's
•    Experience-enhancing technology: Papa John's
•    Top takeout: Hungry Howie's 

Best of Fast Casual: 
•    Great taste: Schlotzky's
•    Best at bringing them back: Raising Cane's Chicken
•    Experience-enhancing technology: Pollo Campero
•    Top takeout: Jimmy John's Gourmet Sandwiches

The 142 chains studied this year include Technomic's Top 100 U.S. Restaurants, as well as leaders in other categories and chains that have grown significantly this year. Winners are chosen based on analysis of key attributes in the time period from fourth quarter 2015 through third quarter 2016. 

Each chain may win only one award annually. If a chain ranks first in more than one category, Technomic typically awards the honor in the category with the widest scoring spread between the winning chain and the second-place competitor.

Fitch looks forward to 2017 
Fitch Ratings and 2017 restaurant outlook report indicates that restaurant companies will see some notable market share shifts in 2017, with home food sales growing an estimated 4 percent — slightly below the 5 percent increase predicted for 2016, according to a news release. 

The company said that breakfast, overall restaurant value and convenience will be primary draws for the sector through the next year.

"Even as the job market improves, consumers are looking for relatively low price points and the convenience to order online when they eat away from home," said Fitch U.S. Corporates Director Carla Norfleet Taylor. "With persistent food price deflation, deal promotions will likely be a tactic restaurants use to get people in the door."

Fitch predicts that Starbucks and Darden Restaurants will profit from these trends, Starbuck's already holds a strong position in the coffee business and Olive Garden has made changes that have increased its popularity and value perception, even as the overall casual dining sector continues to lose share.

As far as anticipated losers in the coming year, Fitch believes that uber-brand McDonald's will continue to lose market share in a competitive restaurant landscape filled with specialty burger competitors and breakfast providers. Fitch also said that Brinker International brand Chili's Grill & Bar will continue to grapple with high exposure to the challenged economies in oil-producing states.