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Restaurant Decision Making Process - US - October 2018

"Restaurant industry sales are expected to grow in coming years as positive economic conditions spur increased consumer spending on AFH (away from home) dining. However, with consumers having more choices of where to dine, restaurants must emphasize convenience to capture dining dollars. In addition, operators must offer more than quality food, including an enticing dining experience and ambience to encourage on-premise dining."

– Hannah Spencer, Foodservice Analyst

This report examines the following issues:

  • Competition for prepared meals is high
  • FSRs experience slowed growth

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Table of contents

  1. Overview

    • What you need to know
      • Definition
      • Executive Summary

        • Overview
          • The issues
            • Competition for prepared meals is high
              • Figure 1: Restaurant competitor utilization, July 2018
            • FSRs experience slowed growth
              • Figure 2: Total US revenues and fan chart forecast of full-service restaurants, at current prices, 2013-23
            • The opportunities
              • Restaurant revenues expected to grow
                • Figure 3: Total US sales and fan chart forecast of restaurants and eating places*, at current prices, 2013-2023
              • Consumers view takeout positively
                • Figure 4: Correspondence Analysis– On-premise vs at-home associations, July 2018
              • What it means
              • The Market – What You Need to Know

                • Consumer spending is up
                  • Operators must combat increasing costs and competition
                    • Interest in LSRs continues to grow, while casual dining chains struggle
                    • Market Size and Forecast

                      • Restaurant sales continue to climb upward
                        • Figure 5: Total US revenues and fan chart forecast of restaurants and eating places*, at current prices, 2013-2023
                        • Figure 6: Total US revenues and forecast of restaurants and eating places*, at current prices, 2013-23
                    • Market Breakdown

                      • LSR growth is outperforming FSRs
                        • Figure 7: Total US revenues and fan chart forecast of full-service restaurants, at current prices, 2013-23
                        • Figure 8: Total US revenues and forecast of full-service restaurants, at current prices, 2013-23
                        • Figure 9: Total US revenues and fan chart forecast of limited-service eating places*, at current prices, 2013-23
                        • Figure 10: Total US revenues and forecast of limited-service eating places*, at current prices, 2013-23
                        • Figure 11: Total US revenues and forecast of restaurants and eating places*, by segment, at current prices, 2016 and 2018
                    • Market Perspective

                      • Consumers have more choice than ever
                        • Consumer interest in convenience stores continues
                          • Figure 12: Total US sales and fan chart of c-store foodservice sales, at current prices, 2012-2022
                          • Figure 13: C-store foodservice attitudes, January 2018
                          • Figure 14: C-stores versus QSRs, January 2018
                        • Retailers invest in supermarket foodservice
                          • Figure 15: retail and foodservice associations, August 2017
                        • Workplace provided lunches could hurt local restaurants
                        • Market Factors

                          • Positive economic conditions ahead
                            • Figure 16: Consumer sentiment index, January 2007- August 2018
                          • Consumers have more discretionary funds
                            • Figure 17: Disposable Personal Income change from previous period, January 2007-July 2018
                          • Generational shares are shifting
                            • Figure 18: Population by generation, 2013-23
                          • Malls must adapt or be pushed out
                          • Key Players – What You Need to Know

                            • Restaurants deliver on convenience
                              • Restaurant founders’ woes hurt chain restaurant sales
                                • Chick-fil-A markets Mealtime Kits
                                • What’s Working?

                                  • Delivering convenience directly to customer’s homes
                                  • What’s Struggling?

                                    • Reputations of restaurant founders
                                    • What’s Next?

                                      • Chick-fil-A testing Mealtime Kits
                                      • The Consumer – What You Need to Know

                                        • At-home dining is restaurants’ biggest competition
                                          • Younger and older generations view dining out differently
                                            • Consumers seek recommendations from friends and family
                                              • Restaurant-goers are interested in more takeout options
                                              • Restaurant Visitation

                                                • QSR visitation remains high
                                                  • Figure 19: Restaurant visitation by restaurant type, July 2018
                                                • Nearly all young women have visited a fast food restaurant
                                                  • Figure 20: Restaurant visitation by restaurant type, age & gender, July 2018
                                                • Younger generations desire more casual dining 
                                                  • Figure 21: Restaurant visitation by restaurant type, by generation, July 2018
                                                • Parents are top restaurant-goers
                                                  • Figure 22: Restaurant visitation by restaurant type, by parental status and gender, July 2018
                                                • Multicultural customers remain important opportunity
                                                  • Figure 23: Restaurant visitation by restaurant type, by race and Hispanic origin, July 2018
                                                  • Figure 24: Adventurous eater segmentation by race, July 2018
                                              • Restaurant Motivators

                                                • Consumers dine out to socialize
                                                  • Figure 25: Restaurant motivators, July 2018
                                                • Parents look to dining out to save time
                                                  • Figure 26: Restaurant motivators, saving time, by gender and parental status, July 2018
                                                • Healthy meal options motivate young men
                                                  • Figure 27: Restaurant motivators, by age and gender, July 2018
                                                • iGens dine out to socialize; Millennials dine out to indulge and relax
                                                  • Figure 28: Restaurant motivators, by generation, July 2018
                                              • Restaurant Information Sources

                                                • Word-of-mouth recommendations are most valuable
                                                  • Figure 29: Information source, July 2018
                                                • Older generations trust recommendations and traditional media
                                                  • Figure 30: Information sources, by generation, July 2018
                                                • Coupons and promotions attract middle income earners
                                                  • Figure 31: Information sources, by household income, July 2018
                                                  • Figure 32: P.F. Chang’s company email, September 9th, 2018, Projected volume: 26.3k
                                                • Parents are more likely to use social media to find restaurants
                                                  • Figure 33: Information sources, by parental status, July 2018
                                              • Traditional Restaurant Competition

                                                • Competition remains high
                                                  • Figure 34: Restaurant competitor utilization, July 2018
                                                • Young men buy meals from many sources
                                                  • Figure 35: Restaurant competitor utilization by age and gender, July 2018
                                                • Parents shop and dine at supermarkets
                                                  • Figure 36: Restaurant competitor utilization by age and gender, July 2018
                                                • Hispanics are top consumers for foodservice retail concepts
                                                  • Figure 37: Restaurant competitor utilization by race and Hispanic origin, July 2018
                                              • Dining Out Associations

                                                • Takeout trumps delivery, but dining out is still king
                                                  • Figure 38: Correspondence Analysis – On-premise vs at-home associations, July 2018
                                                  • Figure 39: On-premise vs at-home associations, July 2018
                                                • Younger consumers more favorable towards delivery
                                                  • Figure 40: On-premise vs at-home associations - delivery, by generation, July 2018
                                                • Lower income households more favorable towards delivery
                                                  • Figure 41: On-premise vs at-home associations -delivery, by household income, July 2018
                                              • On-premise vs At-home Dining Behavior

                                                • More than a third of restaurant-goers are cooking more at home
                                                  • Figure 42: On-premise vs at-home dining behavior, July 2018
                                                • Almost half of young women are cooking more at home than last year
                                                  • Figure 43: On-premise vs at-home dining behavior, by age and gender, July 2018
                                                • Parents are more likely to only dine out for special occasions
                                                  • Figure 44: On-premise vs at-home dining behavior, by parental status, July 2018
                                                • Black consumers, older women interested in calorie counts
                                                  • Figure 45: On-premise vs at-home dining behavior, by age and gender, July 2018
                                                  • Figure 46: On-premise vs at-home dining behavior, by race & Hispanic origin, July 2018
                                                • Middle income earners and parents interested in chains
                                                  • Figure 47: On-premise vs at-home dining behavior, by household income, July 2018
                                                  • Figure 48: On-premise vs at-home dining behavior, by parental status, July 2018
                                                • Parents and younger consumers are ordering more takeout and delivery
                                                  • Figure 49: On-premise vs at-home dining behavior, by parental status, July 2018
                                                  • Figure 50: On-premise vs at-home dining behavior, by age and gender, July 2018
                                              • Dining Out Attitudes

                                                • Consumers dine out to try something new, indulge
                                                  • Figure 51: Dining out attitudes, July 2018
                                                • Younger generations desire both consistency and adventure
                                                  • Figure 52: Dining out attitudes, by generation, July 2018
                                                • Millennials want to indulge when eating out
                                                  • Figure 53: Dining out attitudes, July 2018
                                                • Older women feel it is easier to eat healthier at restaurants
                                                  • Figure 54: Dining out attitudes, July 2018
                                                • Hispanics value ambience
                                                  • Figure 55: Dining out attitudes, ambience, by race & Hispanic origin, July 2018
                                              • Appendix – Data Sources and Abbreviations

                                                • Data sources
                                                  • Sales data
                                                    • Fan chart forecast
                                                      • Consumer survey data
                                                        • Consumer qualitative research
                                                          • Abbreviations and terms
                                                            • Abbreviations
                                                              • Terms
                                                              • Appendix – The Market

                                                                  • Figure 56: Total US revenues and forecast of restaurants and eating places*, at inflation-adjusted prices, 2013-23
                                                                  • Figure 57: Total US retail sales and forecast of full-service restaurants, at inflation-adjusted prices, 2013-23
                                                                  • Figure 58: Total US retail sales and forecast of limited-service eating places*, at inflation-adjusted prices, 2013-23
                                                              • Appendix – The Consumer

                                                                • Correspondence Analysis Methodology

                                                                Restaurant Decision Making Process - US - October 2018

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