Operations

Fast casuals rebounding fastest in Atlanta, Birmingham, Dallas, Salt Lake City, Orlando

istock

June 10, 2021

Geography matters when it comes to pandemic recovery for U.S. restaurant chains, especially in the fast casual industry.

Restaurant chain customer transaction declines in the Dallas-Fort Worth area, for example, improved from double-digit declines last year to -4% in May 2021 compared to May 2019, a pre-pandemic basis of comparison, according to The NPD Group. DFW ranks in the top 10 markets to recover from the steep customer transaction declines caused by the pandemic last year.

In addition to Texas lifting COVID restaurant restrictions in March, the market's May customer transactions reflected restaurants opening and a 10% increase in fast casual chain transactions compared to a year ago, according to NPD's CREST Performance Alerts, which provides a weekly view of chain-specific transactions and share trends for 75 quick-service, fast casual, midscale and casual dining chains.

In addition to the DFW market, other top market areas showing improvements in restaurant chain customer transaction declines in May are Atlanta, Birmingham, Salt Lake City and Orlando. All these markets are in areas where restaurant restrictions had been eased or lifted as of May, and fast casual chain customer transactions grew.

Fast casuals faring well
The recent increases in fast casual chain restaurant transactions were an improvement from the beginning of the pandemic when they didn't do as well as traditional quick-service restaurants, which were well-equipped before the pandemic to handle off-premises operations. Fast casual chains quickly pivoted to focus on off-premises operations, however, and as restrictions were eased, their situation improved. In May 2021, total U.S. fast casual chain customer transactions increased by 2% compared to May 2019, and customer transactions grew over the May 2019 levels in 30 of the top 50 markets. Total U.S. restaurant chain customer transactions across all segments declined by 9% in May 2021 compared to May 2019.

"I often get the question, 'When will the U.S. restaurant industry improve,' and part of the answer is one market at a time," David Portalatin, NPD food industry adviser and author of Eating Patterns in America, said in the release. "My advice to restaurant operators, foodservice distributors and manufacturers is to have a national view but act locally."