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Casual-Dining Trend Means Challenges and Opportunities for Restaurant Owners

March 5th, 2013 ::

By Karen Axelton

For America’s restaurant owners, the casual dining segment has been a hot market for the past several years, helping restaurants get over the difficulties posed by the economic downturn. But what does the future hold for casual dining? Technomic’s Future of Casual Dining Report points out there are both challenges and opportunities in this niche. Here’s a closer look.

Challenges to casual dining are primarily related to the continued economic downturn:

  • Customers are still watching their pennies. If your restaurant falls on the upscale end of the casual dining spectrum, this could hurt you; just 27 percent of consumers say they are visiting these restaurants more often than they did a year ago. In addition, fewer than half (41 percent) of consumers say that upscale casual restaurants are worth the expense because of the ambience.
  • Consumers are still eating out, but most often at the lower end of the price range. Over four out of five casual-dining consumers say they visit fast-casual (85 percent) and traditional casual-dining restaurants (82 percent) at least monthly. Some 40 percent of casual-dining consumers visit upscale casual-dining restaurants once a month.
  • Eateries at both the low end and high end of the price range are being cannibalized as consumers move to the middle. Consumers are more likely to visit fast-casual or traditional casual dining restaurants than they are either fast-food or upscale casual restaurants. The report describes this as “trading up and trading down.”

Those are the challenges; now, what about the opportunity?

  • Compared to two years ago, casual dining eateries have more opportunities to capture business during different dayparts. Consumers in the survey showed more willingness to visit casual dining establishments for all types of occasions, including routine lunches, everyday occasions and meals with co-workers, but also family events and special occasions.
  • Breakfast is another area where consumers are showing great interest in casual dining. Fast-food restaurants have led the way in adding breakfast to their offerings, and now fast-casual restaurants are doing the same—they’ve expanded their breakfast menus by 31 percent since 2011. However, Technomic notes there is still plenty of opportunity in this arena, since more than two-thirds of fast-casual eateries still don’t offer a breakfast menu.

Image by Flickr user israelavila (Creative Commons)

The views expressed here are the author's alone and not those of Network Solutions or its partners.

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