QSR Magazine - The QSR 50 - August 2002 - 16

AMERICA’S HOTTEST CHAINS | QUICK CASUAL quick-casual chain Fazoli’s to develop twenty-plus units and owns quirky/hip Next-Mex chain Chipotle, while Wendy’s owns Texasbased bakery-café chain Café Express and super-hot performer Baja Fresh Mexican Grill, a concept that analysts believe has potential to be a billion-plus dollar performer with Wendy’s backing. Other chains are responding by repositioning themselves. Arby’s, for instance, took a step toward fast-casual when it launched its Market Fresh line of sandwiches. Meanwhile, Dairy Queen, in a move that has some franchisee leaders upset, is currently testing a new DQ Grill and Chill concept that also leans toward quick-casual. compete with quick-casual fare. Burger King is noteworthy in its absence from the quickcasual acquisition game, choosing instead to Burger King is noteworthy in its absence from the quickcasual acquisition game, choosing instead to focus on the Whopper brand and a slew of new products. The message is that quick-casual further blurs the line between what is “fast food” and what isn’t. Further blurring the line is the fact that some traditional quick-service chains have introduced products that are intended to focus on the Whopper brand and a slew of new products, but one of those new product lines, the Back Porch Grillers, is a clear upgrade in burger quality that at least nods to quick-casual. Likewise, Hardee’s introduced its high-quality Six Dollar Burger that, interestingly enough, is intended to compete directly with burgers offered at casual-dining establishments. And yet neither chain could be considered quick-casual. LA MAD’S WALLACE DOOLIN SUGGESTS THAT THE FUTURE scenario in quick-casual is likely to be a few major national players and a host of smaller regional chains. Currently the only true candidate for major national player in quick-casual is Panera Bread/St. Louis Bread Co., which makes its third appearance in The QSR 50 this year with sales of almost $530 million. That’s a huge 51 percent increase over 2000—but is the bakerycafé chain’s lowest annual growth figure in several years. In fact, Panera has increased its systemwide sales by more than 4.5 times since 1998, when it clocked in at $114.2 million in sales. Panera’s closest competitor is Fazoli’s, which is about $125 million behind in systemwide sales, and from there the sales numbers go down markedly. In other words, Panera looks to be the top quick-casual chain for some time to come. Who might catch Panera and where quick-casual in general will end up isn’t yet clear, but there are lessons from the microbrew industry. Analysts have said for several years that the microbrew “trend” is dead, but that’s wrong. It doesn’t possess the buzz it once did, but microbrews haven’t disappeared—they’re still produced by independent regional breweries, smaller breweries owned by mega-breweries, and the mega-brewers themselves. Sound familiar? Microbrews simply aren’t a trend anymore. They’re an accepted part of the beer industry. In time, that will be quick-casual’s place in the restaurant industry. q 56 AUGUST 2002 QSR | www.qsrmagazine.com

QSR Magazine - The QSR 50 - August 2002

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