Operations

Fast casual industry growing strong

Provided by Technavio

May 15, 2023

The fast casual restaurant market witll grow from $186.27 billion from 2021 to 2026 at a CAGR of 12.41%, according to a report from Technavio's, which revealed that North America will account for 44% of that growth and will be faster than in South America and MEA.

Major drivers
Demand for innovation and customization in food menus is driving the market as customers want a combination of food infused with new and bold flavors. The main growing importance of diet is increasing the demand for customized food menus as well, so several market players are offering innovative and customizable food menus to attract customers, according to the release.

The rise in popularity of chef-driven fast casual restaurant franchises is also driving market growth as celebrity chefs have created their own brands, including The Chickery and Fransmart, Slapfish, Bobby Burger Palace and Carla Hall Southern Kitchen.

Competition
Intense competition from quick-service restaurants is challenging market growth, however, as their average meal prices are comparatively lower than those served at fast casuals. QSRs are also focused on lowering order time and payment durations. Due to the rise in consumer purchasing power, people often prefer on-the-go food owing to the hectic lifestyle and the growing preference for convenience. Hence, the rising inclination of consumers toward quick-service restaurants may limit the market growth during the forecast period.

Vendor landscape
The fast casual market is fragmented; the vendors are competing with competitors and are trying to get a greater market share. The market is growing, and the chances of new entrants cannot be overlooked, according to the report. The major vendors have well-established economies of scale and market presence and generally rely on positioning, technological advances and the price of the products.