Trends

Keeping the foodservice equipment marketplace up to date with the latest menu and concept trends.

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The Sweet Spot in an In-Between Niche

Fast-casual restaurants have always been defined by what they’re not — not fast food, not full service. Now, they’re redefining themselves to meet new consumer needs.

Fast-casual eateries have been a foodservice success story for a couple of decades now, but times are changing. Inflation-battered consumers are more price-sensitive. The dining experience is evolving with the integration of technologies such as ordering kiosks and tablets and a corresponding drop in staff-customer interaction. Consumers are assessing the value equation in new ways.

Yet the fast-casual space continues to hit the sweet spot with diners. 

Huy Do, research and insights manager at the food and beverage industry tracking firm Datassential, predicts this sector will have the highest growth among all restaurant segments in 2025, following a successful 2024. In fact, Datassential sees fast-casual concepts accelerating their growth rate — from a projected 1.3% real growth (after taking inflation into account) in 2024 to 1.6% in 2025 and 2.0% in 2026. There are a number of factors responsible, Do says, including a unique value proposition as well as fast casuals’ ability to capitalize on digital technology to drive loyalty. 

Foodservice research and consulting firm Technomic is “very bullish” on continued growth of the fast-casual sector, too, says David Henkes, senior principal at the firm. “Fast casuals offer upscale decor, a better diner experience and ambience, better food and more upscale ingredients than fast-food restaurants, and they don’t tend to get involved in discounting wars as much,” Henkes notes. “Their price points remain higher, and in general we find that consumers are still willing to pay.”

While the overall fast-casual sector continues to grow, the results continue to vary considerably by concept. “Consumers know where they’re getting a great experience and great food for the price and have been pulling back where they don’t find value,” Henkes says.

Some major chains that offer strong operational systems, purchasing clout and economies of scale have been growing fast in terms of both sales and unit expansion, Henkes points out. Examples include Chipotle Mexican Grill, Panda Express, Raising Cane’s, Jersey Mike’s, Shake Shack and Sweetgreen. Some smaller fast-casual chains have lagged behind; some have experienced bankruptcies in 2024, including BurgerFi, Tijuana Flats and Rubio’s Coastal Grill.

Dave’s Hot Chicken credits strong social media as a key part of the chain’s success story.Dave’s Hot Chicken credits strong social media as a key part of the chain’s success story.

Changing Priorities

With takeout and delivery representing a larger proportion of fast-casual sales than in prior years — consumers only eat 36% of fast-casual meals in restaurants, per Technomic statistics — the focus of operations has moved largely outside the dining area. Some examples of this, per Henkes, include Portillo’s, which is zeroing in on increasing the speed of its drive-thru lanes; and Wingstop, which has grown aggressively as an almost exclusively takeout concept.

“Initially, unit ambience was a nice advantage of fast casuals,” says Bob Goldin, co-founder and partner at foodservice consulting firm Pentallect. “Traditional QSR franchises looked tired. Then Panera Bread came around with Wi-Fi service and fireplaces, and Chipotle with its contemporary look. The decor did attract people. But it’s not the selling point it once was. Traffic has moved off-premises across the whole segment.” 

Some fast casuals are adding drive-thrus to most or all new units, Goldin says. That changes unit economics, since many fast-casual concepts originally built small, inline locations. Now, the de-emphasis on dine-in means that both dining rooms and kitchens of new units are shrinking. 

Some fast-casual chains find an important new revenue source in large-order catering, according to Goldin, particularly for workday gatherings and meetings: “Fast casuals were really hurt by the COVID pandemic in the center cities, but now employees are returning. Large orders for off-premises consumption, like big $300 sandwich plates, can really help unit economics.”

Dave’s Hot Chicken utilizes existing restaurant footprints where possible as a way to keep upfront costs lower for franchisees.Dave’s Hot Chicken utilizes existing restaurant footprints where possible as a way to keep upfront costs lower for franchisees.

Hottest Menu Formats

Not every menu category in fast casual has a lot of room for growth, Goldin says. The sandwich sector, for instance, has become commodified: “All segments overexpand when they get hot. A Panera sandwich was great 15 years ago, but now other guys, like Jersey Mike’s and Potbelly, have upped their game, so it’s not so exceptional.” And some fast-casual sandwich chains have failed to stay competitive; both Corner Bakery and Quiznos have gone through bankruptcies, Goldin points out.

Yet some seemingly mature formats remain strong, at least for standout chains like Chipotle (burritos), Shake Shack (burgers) and Sweetgreen (salads). “Conventional wisdom about trends is based on the success stories,” he says. “I don’t see any big menu trends. There are variations on burgers and pizza. There’s growth in Korean and Indian concepts, but from a very small base.”

According to Do of Datassential, “the fast-casual chains that have experienced notable growth in physical presence or sales are those most able to tap into consumers’ rising demand for accessible global flavors as well as their dual interest in both healthful dining and indulgence.” 

One under-the-radar format Do points to as a success: beverage- and dessert-focused fast casuals like Feng Cha, Ding Tea, Cinnaholic and Tous les Jours, which are “benefiting from the emergence of ‘little treat’ culture.”

Mediterranean concepts are another success story, says Do. He mentions CAVA, which “taps into healthful ingredients and trending Mediterranean flavors to achieve double-digit growth figures for both units and sales.”

And here’s one theme everyone agrees on: Chicken is flying high. 

Do singles out bb.q Chicken USA, which has translated global Korean flavors into a scalable business model, and Dave’s Hot Chicken, which has done the same with all-American Nashville hot chicken. Henkes names sector winners include Raising Cane’s, with sales up 27% and unit count up 12% last year, and Wingstop, with sales up more than 20%, per Technomic figures. He also highlights a couple of smaller players: Chicken Guy! and Waldo’s Chicken and Beer. In fact, he says, “Most fast-growing companies have some type of chicken concept.” 

Chicken is cheaper than beef, and also more versatile. “It’s easy to create craveable items using sauces,” Henkes says. “And chicken is also versatile in terms of formats—nuggets, wings, tenders, sandwiches.” 

Italian beef fast-casual chain Buona has expansion plans in place to take the chain from 26 stores to more than 50 in the next several years.Italian beef fast-casual chain Buona has expansion plans in place to take the chain from 26 stores to more than 50 in the next several years.

Tech to Stay on Top

Today’s technology-mediated ordering and dining experience “changes the relationship between the restaurant staff and consumers,” says Henkes. “It takes some of the hospitality aspect out of it.”

That’s why QSRs and fast-casual restaurants are approaching tech in different ways.

“In QSRs, technology is a differentiator, helping chains get people in and out more quickly with hassle-free ordering and pickup,” he explains. “These restaurants might be shifting to exclusively tech-moderated ordering. In fast-casual restaurants, all these things are used, but not to replace human staff — there’s still a cashier or someone at the counter. Technology in fast casuals is used to make human staff more productive.”

Before implementing any form of technology, operators must first identify what consumer need it serves, Henkes says. Today’s key tech challenge for fast-casual operators, he says, is “how to make off-premises orders more quickly and efficiently without ruining the in-store customer experience.”

Point-of-sale systems have been the most intense focus of the tech transformation. “Integration of the POS with what’s going on back of house lets restaurants do more with less,” Henkes says. “A lot of chains are doing ad hoc integration, and it’s hard to retrofit old locations.”

Fast casuals that once might have devoted resources to menu innovation “are now focusing more on the customer experience,” says Goldin: “Are the servers polite? Do I have to wait 20 minutes for my food? Is my order accurate?” 

Goldin points to three technologies that improve diners’ experiences in fast casuals: better online ordering capabilities, AI-enabled voice recognition ordering in the unit and in the drive-thru, and data mining of customer loyalty programs. “Next-generation mining of loyalty information has become almost table stakes in fast casuals, with Panera and Starbucks among the leaders,” Goldin says. “It’s no longer about giving 10% off after you’ve ordered 10 times; now it’s about customized orders.”

Also vital to maintaining the elevated customer experience while boosting speed and efficiency is managing labor. 

“Reducing labor will be necessary, but improving productivity must enhance the customer experience,” Goldin says. “Chipotle does a lot of prep off-premises. Yet seeing staff assemble a bowl, rather than having a machine do it, is really appealing. At Jersey Mike’s, when you see a guy slicing tomatoes, it matters.”

But foodservice workers aren’t going to be slicing tomatoes for the next 10 years, Goldin says. “The ability of fast casuals to deliver truly ‘fresh’ products will be significantly impaired in coming years,” he says.

Processing fresh foods in today’s smaller kitchens will require efficient back-of-the-house design, Goldin says. He sees a place for automation and even robotics, but he’s skeptical about robotic prep systems like the Infinite Kitchen salad assembly at Sweetgreen. “It’s gotten a lot of publicity, but it’s installed in only one place so far,” he says. “It’s not going to have a big payback for a long time.”

Culinary Equipment in Fast-Casual Restaurants

Ms fes2502 marketspotlight graph2Source: Datassential 2023 survey, culinary equipment that fast-casual operators report owning.  Other equipment mentioned: conventional pizza oven, floor mixer (both 33%), conveyor oven (28%), combi oven, cook-and-hold oven, speed oven (all 23%), tilt braiser/griddle, specialty equipment, air fryer (all 15%)

Beverage Equipment in Fast-Casual Restaurants

ms graph1 fes2502 marketspotlight graph1Source: Datassential 2023 survey, beverage equipment that fast-casual operators report owning.  Other equipment mentioned: beverage vending machine (29%), espresso maker (25%), bar gun (15%)

Winning at Fast Casual: Tapping the Power of Social Media

Dave’s Hot Chicken is the kind of rags-to-riches success story people in the restaurant industry love to tell: Three young Armenian Americans with no background in foodservice and a collective $900 to invest, start a pop-up tent restaurant in a Hollywood parking lot. On their third night, a food blogger they’d reached out to — Farley Elliott of Eater LA — stops by, then writes a rave review. Seven months later, the partners open their first brick-and-mortar restaurant. Seven years after that, Dave’s is a 250-unit multi-national franchise.

“Our brand’s ‘secret sauce’ is social media,” says Jim Bitticks, company president and CEO. Dave’s now has a “magical” following on Instagram and TikTok, Bitticks says, engaging with a loyal clientele consisting primarily of 15- to 35-year-old males. 

But cool marketing isn’t enough to be successful, Bitticks stresses: “The food was great from the very beginning.” The menu narrowly focuses on chicken tenders, hand-breaded and spiced in units and then fried, served with a single sauce. Sides are fries, mac & cheese, kale slaw, fruit-based slushers and shakes. 

The minimalist operating philosophy extends to site selection. Dave’s utilizes existing restaurant footprints wherever possible “for franchisees to have a low upfront cost,” Bitticks explains. “We keep whatever is salvageable, the hood and all the equipment and infrastructure we can.”

Kitchens have five fryers and a double-sided high-volume makeline. Kitchen display systems are customizable and are equipped to print out a label for each item on every customer’s tray, helping to minimize order errors.

“We’re looking ahead toward new equipment, new forms of automation, potentially robotics to help make the french fries,” Bitticks says. Ordering kiosks have been installed in some units — a process that sped up in California last year after the minimum wage rose to $20 an hour. 

Fewer than a quarter of locations have drive-thrus, but Dave’s is still focused on enhancing the drive-thru experience. It’s planning a test with DoorDash of their artificial intelligence-based order taking system. “The AI can take the order and enter it into the POS system; the employee just makes the drink and greets the guest,” Bitticks says.

Dave’s Hot Chicken is just one small example of how operators in the fast-casual space are rethinking what their segment offers today: good, fresh food, as close to housemade as possible, with unit labor positioned where it makes the most impact, maintaining the customer’s perception of service and hospitality. 

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