News

Customization leading to fast casual growth, access to capital

September 17, 2013

Customization has been key to the success of fast casual restaurants, according to a report, "2013 Restaurant Sector Update," that found that large and middle market restaurant companies, as well as franchisees of top-tier brands, have ready access to capital.

Bob Bielinski, managing director of CIT Corporate Finance, Retail and Restaurants at CIT Group Inc., a provider of financing and advisory services to small businesses and middle market companies, also said that franchisees of smaller brands are finding it more challenging to secure debt financing. Bielinski's report is the latest in a series of in-depth executive Q&As featured in CIT's Executive Spotlight series.

"The customization trend is linked to the increased popularity of fast casual restaurants," Bielinski said. "From the consumers' point of view, one of the major appeals of fast casual restaurants is the ability to customize. The appeal of designing your own pizza and having it cooked for you in a matter of minutes is very strong."

He also said self-service frozen yogurt shops appeal to consumers' desire for customization.

"It allows do-it-yourself mixing of different yogurt flavors and toppings with complete control over quantity," he said.

The most interesting growth in the restaurant industry will continue to come from fast casual brands, which are taking market share from traditional quick-serve and casual dining restaurants, Bielinski said.

"Fast casual restaurants better meet the way consumers want to approach their dining experience today," he said. "The quality of the food is higher, the dining atmosphere is newer and fresher, and the consumer is in control of the time commitment required for the meal."

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