Operations

Report: Fast casual sector still outpacing overall restaurant growth

Although the overall news was positive, the segment faces a delicate balancing act as operators navigate rising overhead. Food costs remain the top operational challenge, cited by 85% of operators, while median item prices have climbed 5% over the past 12 months to $9.99.

Kelly Dykhuizen, VP of Customer Experience at Datassential, breaks down findings from the Fast Casual State of the Industry report Oct. 5, 2026, during the Fast Casual Executive Summit. Photo: Connect Media

October 21, 2026 by Cherryh Cansler — Publisher, FastCasual.com

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Fast casual continues to outshine the broader restaurant industry, projected to lead real sector growth in 2027 at 1.4% compared to 0.9% for the overall industry. Operator sentiment remains strong as well, with 76% expecting higher foot traffic in the coming month — the highest optimism of any restaurant segment — according to the 2026 Fast Casual State of the Industry Report. FastCasual had the honor of partnering with Datassential on the report to provide a look at operator challenges, menu trends, unit expansion and shifting consumer demographics

Although the overall news was positive, the segment faces a delicate balancing act as operators navigate rising overhead. Food costs remain the top operational challenge, cited by 85% of operators, while median item prices have climbed 5% over the past 12 months to $9.99.

Key insights

Coffee and Bakery Lead Expansion: Nearly half of the fast casual chains leading YTD unit growth fall into the coffee and bakery categories. Brands like Starbucks, CAVA, and Shake Shack continue steady expansion, while rising concepts such as Better Buzz and Foxtail Coffee Co. post strong double-digit growth.

Kelly Dykhuizen, VP of Customer Experience at Datassential, presented this slide during the Fast Casual Executive Summit, where she broke down the report's findings.

Non-alcoholic drink LTOs surge: Non-alcoholic beverages dominated menu innovation in the first half of the year, with top chains introducing over 150 new, returning or limited-time drinks, driven largely by iced coffee, refreshers, and fruit-forward flavor profiles.

Appetite for innovation: More than 60% of fast casual diners report being willing to pay a premium or select items featuring unique and innovative menu options, with high-protein builds and global flavors commanding strong consumer interest.

Off-premise dominance: Off-premise dining continues to represent a core revenue stream, generating 58% of total segment revenue over the past year.

The full report includes detailed brand performance rankings, Net Promoter Scores and category-level pricing breakdowns across the fast casual landscape. Download it free.

About Cherryh Cansler

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Cherryh Cansler is Publisher of FastCasual.com and Vice President of Connect Food. She has been covering the restaurant industry since 2012. Her byline has appeared in Forbes, The Kansas City Star and American Fitness magazine, among many others.

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