How Restaurants Can Survive the Economic Downturn

From QSR Magazine- by Jessie Szalay

The restaurant downtrend will likely continue through this year, but brands can take steps to safeguard their growth.

It’s a new year, but many restaurants are looking to the future with apprehension, not enthusiasm.

The slumping sales trend of 2016 is expected to continue into at least the first quarter of 2017. In November, MarketWatch predicted that a recession in the restaurant industry was coming, citing a forecast from Moody’s Investors Service that slashed profit-growth expectations from 5–6 percent in the next 12–18 months to 2–4 percent.

But industry experts, as well as brands that have continued to grow despite the downturn, say operators can take steps to ride out these conditions.

“I know a lot of people in the restaurant industry are down, but this was one of our best years,” says Doug Koegeboehn, chief marketing officer at Wienerschnitzel, of 2016. Last year marked the brand’s fifth consecutive year of improving sales, and Koegeboehn expects the growth to continue.

Tennessee-based Captain D’s has had similar success, reporting its 20th consecutive quarter of strong same-store sales growth in 2016’s Q4.

Both Captain D’s and Wienerschnitzel attribute their success to differentiation of product, brand, and experience. For Captain D’s, items like $4.99 meal deals with whole-muscle proteins, two sides, and hush puppies help the brand stand out.

Continue Reading at QSR Magazine

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