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National Restaurant Association - NRA's first fast casual conference draws more than 100

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NRA's first fast casual conference draws more than 100

The fast casual industry is expected to outpace other restaurant industry segments as the sector grows and evolves. By 2016, fast casual sales are expected to represent 40 percent of limited-service-restaurant dollar growth, according to Technomic research released at a new National Restaurant Association conference.

Technomic president Ron Paul discussed the state of the fast casual industry Oct. 3 at the National Restaurant Association's Fast Casual Trends and Directions conference. The conference, which explored hot concepts, menu and culinary trends, consumer perspectives and social media influence, drew more than 100 fast casual restaurant executives.

“Fast casual is the bright spot in the industry,” Paul said, noting that seven of the 10 fastest-growing chains are fast casual operations. The top three are Five Guys Burgers & Fries, Jimmy John’s and Chipotle.

Big growth
The fast casual segment grew 14.4 percent between 2001 and 2011, compared with 3.5 percent of all restaurants and bars. “This justifies that high-level interest in the segment,” Paul said.

Although fast casual represents a relatively small part of the restaurant industry, it has captured an increasing share of limited-service business, Paul pointed out. In 2001, fast casual was a $7 billion a year segment, representing 5 percent of LSR. Last year, it was a $27 billion segment, representing 14 percent of LSR. However, quickservice operations are trying to regain some of that business, Paul said.

“The rest of the universe is not going to sit there and do nothing,” he said.

Competition reacts
Traditional quickservice operations are beginning to react with better burgers and sandwiches, Paul noted. Examples include artisan pizzas, such as Domino’s spinach and feta; natural-cut French fries at Wendy’s and beer and wine service at White Castle.

Some QSRs also have opened fast casual versions of their brands, Paul said. They include Captain D’s, which overhauled its menu and décor, and Burger King's BK Whopper Bar, which offers gourmet sandwiches, premium toppings and beer. Furthermore, fullservice restaurants, such as Uno Chicago Grill and Pizza Inn, have launched fast casual spinoffs: Uno Due Go and Pie Five.

Within the fast casual segment, Paul said he expected burger and specialty concepts to be high-growth areas. Bakery/café concepts represent the greatest portion of the fast casual segment (24 percent), followed by Mexican/Southwestern (22 percent), specialty (20 percent) sandwich (13 percent), chicken (11 percent) and burger (10 percent).

“None of these subsegments is fully penetrated,” he said.

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