Familiar pain points demand fresh focus.
Multi-unit chain restaurants continue to adapt to volatile market conditions and consumer preferences. We took part in this year’s IFMA Chain Operators EXchange (COEX) and captured a firsthand look into what foodservice operators are prioritizing for the year ahead. Here are the key points every food manufacturer should know, including new studies from Datassential, Kinetic 12, and Technomic as well as telltale individual accounts from the nation’s top chains.
While the pain points aren’t entirely new, there’s a fresh urgency to solving them.
1. Driving and maintaining traffic and loyalty.
Restaurant chains are competing with more than just each other as consumers are turning to alternative food-away-from-home options. Potential diners can find fully prepared fare and meal kits everywhere they turn, from the local grocery and c-stores to new micro markets and mail-order services.
Emerging chain operators look to more consistent menu execution as the #1 priority in improving traffic.
To that end, many chains continue to streamline operations by simplifying menus and reducing SKUs – cutting products that only work for a single menu item.
Supplier opportunity:
- Prioritize products that offer multiple applications and use-cases for your operators.
- Demonstrate value beyond a single menu application or risk being cut.
2. Increasing profitability.
Rising food prices and labor costs are still the most pressing challenges for operators by far.
72% of operators are looking for cost-saving solutions from suppliers (including labor savings).
There’s an increased focus on cost management and efficiency overall as inflation in the food-away-from-home segment is tracking around 5.1% YoY compared to 3.1% for general inflation. Providing a winning consumer experience while maintaining adequate margin continues to be a balancing act for chain operators. Pennies can make the difference.
Supplier opportunity:
- Innovate products that offer labor saving solutions in the back of house.
- Come with application concepts that deliver value to the consumer beyond price.
3. Expanding limited time offers.
Since 2020, LTO introductions among top chains are up 52.7% while core menu introductions have decreased .9%.
Operators are using LTOs strategically to offer a differentiated experience and attract new guests – introducing new items at a better margin to help offset the need to increase base menu rates.
The strategy is proving effective – in fact, 71% of Gen-Z consumers will return to a restaurant if there’s an LTO.
Supplier opportunity:
- Partner with operator customers to create unique, trend-forward, and easily executable menu items that help drive incremental traffic.
- Demo how your product can extend to multiple base menu items for added stickiness.
While these are the most common pain points across the industry, every chain has its unique challenges.
Ultimately, consumers choose to dine out because the food is seen as more craveable and more enjoyable than what they can make at home.
Start by understanding your customer’s customer and craft your go-to market strategy from there.
