restaurant chains

Prominent restaurant chains withstanding pandemic

The 50 largest restaurant chains were able to withstand the pandemic far better than smaller chains or independents, according to Technomic’s 2021 Chain Restaurant Report.

Sales at the 500 largest restaurant chains in the U.S. declined more than eight per cent last year, according to the report. Chain restaurants closed fewer locations than expected and gained ground in a restaurant industry that has, generally speaking, been devastated by the effects of the pandemic.

The 50 largest chains were, naturally, more likely to generate growth thanks to the pre-existing proliferation of drive-thrus, online operations, and delivery options. These have all accelerated as key trends across the industry during the pandemic, thus exposing the advantage offered by already having those systems in place.

Unsurprisingly, then, chain restaurants performed far better than independents last year.

The 500 largest chains generated US$304 billion in sales. That was down US$27 billion from the year before, but shouldn’t mask the fact that “market share for the industry’s largest chains expanded significantly,” according to Kevin Schimpf, senior research manager at Technomic.

The biggest chains clearly outperformed everyone else: the median sales change for the 10 largest chains rose 0.1 per cent last year in comparison to a 0.8 per cent decline for the 50 largest chains. For the other 450 chains listed, the median sales change was a devastating decline of 19.4 per cent, more accurately reflecting the industry rate of change.

Much of the largest restaurant chains’ resilience, suggests Technomic, can be put down to takeout. Thirty-seven of the 500 largest chains are either fast-food or fast-casual restaurants, and 12 of the 50 largest chains operate either chicken or pizza-focused restaurants, which generally fared comparatively well.

Technomic ranks restaurants based on system sales, counting all of the sales generated by restaurants whether they are company-run or franchisee-owned.

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