These 5 restaurants will dominate the rest of the industry

The restaurant industry is getting increasingly competitive.

Consumers are demanding healthier food, and there are number of fast casual restaurants like Chipotle and Panera Bread that are threatening traditional fast food companies and casual dining chains.

To get an indication of which restaurants chains will dominate over the next decade, analysts should look at where teens are spending their money.

Teens spend the biggest chunk of their budgets on eating out, and the restaurants that win their favour are potentially gaining lifelong customers.

Here are the top five restaurants among upper-income teens, according to a recent survey by Piper Jaffray.

1. Starbucks

Starbucks is the perennial favourite among teens, having slowly replaced the mall as their preferred place to meet up and hang out.

The coffee chain has been the No. 1 choice among both upper-income and middle-income teens for each of the last 10 surveys by Piper Jaffray.

The chain’s food sales are exploding, and now it’s adding beer and wine to the menu at dozens of locations across the US, which will likely make it even more appealing to young people. The popular loyalty program and app are also major growth drivers.

2. Chipotle

Teens love Chipotle for its fresh ingredients and no-frills marketing.

The chain continues to invest in its Asian ShopHouse and Pizzeria Locale concepts, and it just hired Starbucks’ chief information officer to improve its mobile app and other technology products.

3. Chick-fil-A

Chick-fil-Chick-fil-A is dominating fast food.

The chain, which is best known for its crispy fried chicken and waffle fries, generates more revenue per restaurant than any other fast food chain in the US, according to QSR magazine.

Chick-fil-A’s average sales per restaurant in 2014 were $US3.1 million, QSR reports. By comparison, fried chicken competitor KFC sold $US960,000 per restaurant.

Despite its relatively small size, Chick-fil-A also ranks highly in terms of its total system-wide sales.

The chain generated nearly $US5.8 billion in revenue in 2014, making it the eighth largest fast food chain in the US, according to QSR.

4. McDonald’s

McDonald’s has been struggling to revive business after seven straight quarters of same-store sales declines.

But if teens’ devotion to the brand is any indication of its future potential, then McDonald’s will be able to pull off a turnaround.

McDonald’s ranks fourth among upper-come upper-come teens and it ranks second among average-income teens, according to Piper Jaffray.

The chain’s low prices are a big draw for cash-strapped young people, who are more likely to be underemployed and working multiple jobs to pay off student-loan debt.

5. Panera Bread

Panera, like Chipotle, is a fast-casual restaurant offering quick, made-to-order meals with fresh ingredients.

The company is also making a lot of changes that are resonating with younger customers, such as installing digital kiosks for ordering, as well as offering in-store pickup.

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