The growth of fast casual restaurants like Chipotle and Five Guys is killing the lower-end full-service dining industry.
Sit-down restaurants like Red Lobster and Olive Garden are among the restaurants at the losing end of the battle for consumers’ palettes.
This telling chart from UBS is evidence of the dramatic shift away from casual dining:
The chart was published in a UBS research report on the U.S. restaurant industry.
“Increasingly, superior ‘food for the money,’ not service, is driving restaurant consumption patterns and [same-store sales] trends,” UBS analysts wrote. “In our view, consumers don’t want to spend more but want a better food value proposition (either quality value or absolute value), and are willing to swap out some level of service to pay for it.”
“The recent shift away from the more service intensive casual dining experience toward fast casual concepts is clear evidence of this, in our opinion,” the analysts added.
UBS also notes in its report that pizza and wing chains have a better outlook in 2014 than steakhouses and Italian restaurants.
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