Technomic’s Top 500 Rankings Shows How Bad 2020 Has Been For Casual Dining

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The nation’s largest casual restaurant chains could at least hang on to one encouraging fact as they trudge through 2020: Pandemics tend to only happen once a century.

While major fast food brands saw only a 1.9% drop in revenue last year, the occasional Technomic Top 500 ranking operations winced due to slowing proportions. biblical. Sector sales fell 26.6% and closures pushed the market down 5.1%, more than double the 2% attrition for all Top 500 chains.

“The performance gap between limited service and full service was huge,” says Kevin Schimpf, senior director of industrial research for Technomic. “The strong performance of the big drive-thru and delivery giants really made up for the poor performance of full-service chains. “

The occasional chains were the notable culprits. For the first time in recent memory, not a single laid-back brand finished in the Top 20 of Technomic’s system-wide sales rankings. The top performer was Olive Garden at number 21, a pole that the Darden Restaurants brand landed despite a 20.5% drop in sales.

Even without the commitment most casual chains made to delivery (Olive Garden has maintained its policy of dropping orders under $ 75), the Italian brand has retained enough business to claim the long-standing title of ‘Applebee as the country’s biggest volume casual chain. Its system-wide sales totaled $ 3.41 billion, compared to Applebee’s $ 3.10 billion.

Applebee’s, a holding company of Dine Brands Global, actually fell two spots among casual chains due to a 24.1% drop in sales. Buffalo Wild Wings slipped to second place, with $ 3.11 billion in contributions, keeping its 2020 sales decline to 15.1%.

Chili’s, Applebee’s big rival, was fourth among casual chains and 25th overall on the Top 500 list with a 13.5% drop in system-wide sales to $ 3.08 billion . Texas Roadhouse was fifth with $ 2.69 billion in system-wide sales, down 13.4% from 2019.

The drop was the smallest for any casual chain in the Top 100. The biggest drop was Ruby Tuesday’s 51.5% drop, a drop that pushed the venerable brand into bankruptcy protection of chapter 11.

Even the national giants who led casual dining were easily overtaken in sales by multi-regional chains such as Panda Express and Jack in the Box.

Schimpf quotes quite a long list ”of the reasons for the large divergence in sales between the casual restaurant and the limited-service sector in 2020. First on its recap: the advantage that fast food restaurants had in embracing off-establishment activities when theaters dining rooms were closed. This head start featured full service concepts “that were catching up to try and recoup some of their sales volumes through deliveries and deliveries,” he says.

A breakdown of some casual dining data by quarter shows that operational adjustment is in action. In the first three months of 2020, sales of major public casual dining brands fell 7%, reflecting the onset of the pandemic, according to Technomic. Sales bottomed out in the following quarter, the first full quarter of the crisis, dropping 47%.

As casual chains found their way off-site, sales for the July-September period rebounded to less than 23% of the previous year’s level. Once the issues were resolved, the big brands continued to rebuild their sales in the last three months of the year, falling below 21% of the level recorded in 2019.

Many parts of the country have relaxed restrictions on indoor dining, a trend that greatly benefits occasional operators. But Schimpf still sees a bumpy road ahead of him. “Even in markets with more relaxed rules on indoor dining,” he says, “customer traffic remains significantly reduced as many customers are still reluctant to resume their pre-pandemic dining behaviors.”

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