Calgary Herald

Bigger bite of market for fast-food eateries

McDonald’s, Tim Hortons encourage patrons to eat in by offering comfort

- HOLLIE SHAW

TORONTO The full-service restaurant business is stagnant in Canada while sales in the quick-serve sector keep growing, according to new data — even among the crowd who like to sit down and have a meal.

Annual sales at full-serve restaurant­s remained flat at $22 billion to the end of May, market research firm NPD Group Canada reports, while sales at quick-service restaurant­s rose 4.2 per cent to $24.2 billion. The remainder of Canada’s $49.2-billion restaurant business goes to the so-called home meal replacemen­t category.

When you look inside the restaurant­s, the consumer shift looks even more dramatic: Quick-service establishm­ents (QSRs) such as Tim Hortons and McDonald’s had their dine-in visits rise six per cent during the year, NPD reports, while onpremise dining at full-serve casual dining eateries fell six per cent.

“Generally, consumers are going out to restaurant­s less often,” said Robert Carter, executive director of food service at NPD.

People are making the shift from full-service into QSRs, or the subset of so-called ‘fast-casual’ restaurant­s exemplifie­d by chains such as Chipotle or Mucho Burrito.

“That lends itself more to sitting down and eating inside the location. Even if people are not going to a full-service restaurant, they still want to have the experience of going out and sitting in a restaurant.”

A liquor licence may also be helping revenue and traffic in the fastcasual segment, Carter added. At licensed fast-casual restaurant chains such as Mr. Greek, patrons typically dine inside, a practice that drives up the average dining cheque.

“You treat it almost like a fullservic­e restaurant, but there is no table service,” he said.

Seven years ago, sales at quickservi­ce outlets represente­d less than half of Canada’s $49.2-billion restaurant business and sales at full-service restaurant­s accounted for 50.2 per cent of the market.

But the format has been struggling to recover since the recession.

In the meantime, classic fast-food chains such as McDonald’s have encouraged more patrons to dine in by significan­tly renovating their restaurant­s with comfort in mind.

“They have added cafes, fireplaces and TVs,” Carter said. “Tim Hortons is doing the same thing and they are seeing gains in that on-premise dining.

“The benefit to them overall is that the average eater cheque when (consumers dine) on premise is considerab­ly higher than when they go to the drive through or take out.”

 ?? MICHELLE SIU/ FOR NATIONAL POST ?? According to recent data, annual sales at full-serve restaurant­s remained flat at $22 billion to the end of May while sales at quick-service restaurant­s rose 4.2 per cent to $24.2 billion.
MICHELLE SIU/ FOR NATIONAL POST According to recent data, annual sales at full-serve restaurant­s remained flat at $22 billion to the end of May while sales at quick-service restaurant­s rose 4.2 per cent to $24.2 billion.

Newspapers in English

Newspapers from Canada