Casual dining chains make a comeback with 2021 sales

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Sales in the casual dining segment were devastated by the COVID-19 pandemic in 2020, but surged in 2021, with most major brands posting double-digit gains in a year that was rocked by virus outbreaks.

While restoring dining room capacity and retaining a significant share of off-premises sales during the pandemic, the casual dining segment has seen some of the most dramatic increases in sales in 2021.

As they battled surges in variants of the COVID-19 virus, businesses also turned to virtual brands to expand their reach and take advantage of excess kitchen capacity, and they continued to operate with menus. simplified to facilitate operations, streamline manager jobs and help retention rates. .

In this year’s Top 500, the top five casual dining players saw their sales increase between 18% and 44%.

Olive Garden, the Orlando, Fla.-based division of Darden Restaurants, increased sales 18% to $4.185 billion.

Ric Cardenas, who took over from Gene Lee as CEO of Darden on May 30, said on an earnings call in December that the brand’s focus on simplicity during the nearly two-year pandemic had helped Olive Garden emerge strongly.

“Our focus on simplifying operations to drive execution remains our top priority, which is why we once again paused any new initiatives during the quarter to eliminate distractions and empower our operators to focus on running big shifts,” Cardenas said. “This pause also ensures they can focus on people and product as we navigate today’s workforce and supply chain challenges.”

Darden also increased by one year, through January 2022, a proposed commitment to raise the minimum hourly wage for restaurant team members to $12, which included income earned from tips.

“This primarily affects entry-level roles such as hosts, busses and dishwashers. And with this change, we expect our restaurant team members to earn, on average, around $20 an hour,” Cardenas said, adding that pay raises are helping retention.

Dallas-based Brinker International’s Chili’s Grill & Bar posted a 22% increase in sales to $3.921 billion for 2021.

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“Brinker’s fourth quarter was a positive end to a successful fiscal year, with Brinker posting one of its most profitable quarters in recent history,” said Wyman Roberts, CEO and President of Brinker, who was replaced this month by former KFC US President Kevin Hochman.

Brinker was a leader in creating virtual brands, It’s Wings and Maggiano’s Italian Classics, to exist as delivery-only vehicles. Roberts also oversaw the expansion of virtual brands into drone delivery and added robot servers to Chili’s units to help staff members.

Meanwhile, Applebee’s Neighborhood Grill & Bar saw sales increase 34.4% to $3.742 billion, from $2.785 billion in 2020.

“This past year has delivered strong growth for our business which can best be defined by our results, Applebee’s record annual sales performance over 2019, a marked improvement in gross margin and the ability to resume the return of capital to shareholders,” said John Peyton, CEO of Glendale, Calif., Dine Brands, in a note ending the year.

Applebee also basked in the pop culture spotlight in 2021 with the song “Fancy Like,” a country hit from musician Walker Hayes.

Buffalo Wild Wings, which is owned by Atlanta-based Inspire Brands, ranks fourth among the top casual dining chains in the NRN’s Top 500. The sports bar concept saw sales increase 17.5% to $3.718 billion. To appeal to offsite customers, the brand launched its Buffalo Wild Wings Go store format in 2021, which features a walk-in counter, digital menu boards, condensed seating and heated take-out lockers for walk-in pickup. contact.

Leading the pack in the top five by percentage increase in sales, Louisville, Kentucky-based Texas Roadhouse saw sales jump 44.4% to $3.415 billion. The Calabasas Hills, Calif.-based Cheesecake Factory also saw sales increase 44% to $2.199 billion.

During the pandemic, Texas Roadhouse had transformed its halls into distribution areas for take-out sales and was looking to convert some restaurants with permanent pick-up areas. In the fourth quarter, Texas Roadhouse continued to see strong take-out sales, averaging 17.1%, or $120,706 per week, in its company-owned units.

“We had a historic year in terms of the number of guests we served and the operating results we generated,” said Jerry Morgan, CEO of Texas Roadhouse. “It’s all down to the hard work and commitment of our operators and their ability to continue to meet our legendary standards during these difficult times.” The company also opened 29 company restaurants during the year.

The off-premises chain produced by the pandemic continued to be a major revenue stream for most casual dining brands in 2021.

Darden’s Cardenas said the technology improvements have also strengthened the offsite product.

“Takeaway sales continued to benefit from the strength of our digital platform,” he said at the end of the year. “This platform not only makes execution easier for our teams, [but] it is more convenient for our customers to visit, order, pay and pick up.

In the second quarter, the last full reporting period for Darden in 2021, off-premises sales accounted for 28% of total Olive Garden sales and 15% of total LongHorn Steakhouse sales.

“Digital transactions accounted for 60% of all offsite sales during this quarter and 11% of total Darden sales,” Cardenas said.

Contact Ron Ruggless at [email protected]

Follow him on Twitter: @RonRuggless

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