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Food is being served in more nontraditional outlets

Foodservice providers need to think outside of their brick-and-mortar chain locations.  

McDonald’s is serving up hot and ready-to-eat food at their “ski-thru” location in Sweden. 

Who’s after restaurant food dollars? Simply puteveryone.  Grocery stores are now restaurants, and malls are becoming a food destination.

In today’s market, it is crucial to get ahead and go to where the consumer already is.  

 

As if the restaurant space wasn’t crowded enough, many new and nontraditional dining formats have exploded onto the scene in recent years. Many franchisees have moved to non-traditional venues and are reaping the benefits of these high foot traffic areas. 

Operations are beginning to compete directly for the consumer’s time, money, and appetite, and you’ll find them in the most unsuspecting locations.

Take a look at the top places where consumers are eating and why the foodservice industry needs to pay attention.

Higher Education Institutions

According to Shultz Hartgrove, former vice president of non-traditional licensing for Einstein Noah Restaurant Group, non-traditional restaurants at universities, and other high traffic locations, serve as a great introduction to a brand for busy, on-the-go consumers.

Advantages

  • Potential to a build long-term loyal customer base
  • Flexible and/or extended hours of operation
  • A constant stream of potential customers (students, alumni, professors, sporting events)

Disadvantages

  • Slower months during the summer season
  • Dependent on the semester and holiday schedule
  • Constructing the space could be limited due to size or building restriction

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Hospitals: Speedy Service for a Speedy Recovery

A consumer may not be seeking an extraordinary dining experience in a hospital, which is exactly why they are the perfect location for a non-restaurant restaurant.  It is interesting to point out that operators should not analyze this space using the industry standard RevPASH and RevPAR. etc. Instead, it is wise to look at the number of hospital employees, hospital beds, and outpatients.  

 

QSR and Fast Casual offer convenience and speed of service.  Patrons are able to experience their favorite sandwich or smoothie without needing to drive out of their way.  The benefit of being in a hospital is meeting the customer where they already are.

The New Drive-Thru

Meals are no longer defined by breakfast, lunch, and dinner.  Busy consumers have shifted the way in which the foodservice industry looks at meal times and prime hours.  As summer comes to a close, people are back to work and do not have time to take an hour break for lunch each day.  According to Food Truck Operator, food truck growth is outpacing overall commercial foodservice, such as restaurants, at a growth of 5.4 percent versus 4.3 percent.  The industry is now seeing many restaurants jump on the mobile trend to offer patrons a more casual and fun menu.

Courtesy: Food Truck Operator

Advantages

  • Lower startup cost in comparison to brick-and-mortar locations
  • Caters directly to the consumer to find the target market. If one place doesn't seem to attract enough business…no problem. Shift into drive and find another spot.
  • Marketing hotspot for fun on-the-go branding and also offers geotagging capabilities.
  • “Fast food" without being positioned as the greasy meals most consumers think of .
  • For existing brands: Food trucks offer a way to cross promote. Branded trucks with the company logo help drive traffic to other locations. Use the mobile store to build awareness for the brick and mortar location and visa versa.

Disadvantages

  • Procedures and regulations may be slowing this sector down. However, what area isn't this true with? Even a kid's lemonade stand will get coded these days!
  • Operators are dependent on the vehicle to work properly in order to make sales and travel to destinations.

Grocery Store + Restaurant = GROCERANT!

C-Stores and supermarkets are stealing restaurant food dollars. It is important to note this competitor in the market as they are, for lack of a better term, part of the food chain.  While this is not a specific location to open a legacy brand, it is vital to see the massive impact that these so-called ‘grocerants’ have on the market. 

 

Companies such as Whole Foods have been in the grocerant business for years, offering fresh salads and an array of quick eats.  Other grocery stores are now disguising themselves and providing ready-to-eat and heat-and-eat options such as Trader Joes in the US. 

Grocerants are continuing to blur the lines between supermarket and restaurant.  

Large chains such as T&T Supermarket in Vancouver opened its first seafood bar this August.  Consumers are loving this concept as there has been a 60-minute wait for seating since the supermarket opened!

 

What makes these locations desirable? High visibility and new opportunity. Places such as Airports, Food Courts, Music Festivals, and Universities, are crawling with target consumers.  While every audience and space is a little different, these high foot-traffic areas are prime for a QSR’s expansion.

 

 

It is an exciting time as quick-service eateries explore more sites with captive audiences—zoos, ferry boats, bowling centers, car washes and more.

Leveraging these non-traditional dining options is not a disruption in the foodservice industry, it is the industry.  

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