Restaurant Chains Serving More Lower-Calorie Choices Do Better Financially
Chains see improved sales, traffic and total servings when they serve more lower-calorie items
WASHINGTON, Feb. 7, 2013 /PRNewswire-USNewswire/ -- Restaurant chains that serve more lower-calorie foods and beverages have better business performance, according to a study released today by Hudson Institute. Over five years, chains that increased the amount of lower-calorie options they served had better sales growth, larger increases in customer traffic, and stronger gains in total food and beverage servings than chains whose servings of lower-calorie options declined. The authors of the report believe it is the first to determine the financial impact of lower-calorie foods and beverages on the U.S. restaurant industry.
The report, Lower-Calorie Foods: It's Just Good Business, analyzed 21 of the nation's largest restaurant chains, including quick-service chains such as McDonald's, Wendy's, Burger King, and Taco Bell, and sit-down chains such as Applebee's, Olive Garden, Chili's, and Outback Steakhouse. Together these 21 chains have $102 billion in annual U.S. sales and 49 percent of the revenue of the top 100 restaurant chains.
"Consumers are hungry for restaurant meals that won't expand their waist lines, and the chains that recognize this are doing better than those that don't," said Hank Cardello, lead author of the report, Senior Fellow at Hudson Institute, and Director of the Institute's Obesity Solutions Initiative. Cardello is a former executive with Coca-Cola, General Mills, Anheuser-Busch, and Cadbury-Schweppes.The report found that, between 2006 and 2011, lower-calorie foods and beverages were the growth engine for the restaurants studied. In 17 of the 21 restaurant chains evaluated, lower-calorie foods and beverages outperformed those that were not lower-calorie. In addition, chains that increased their servings of lower-calorie items saw positive returns as a result. These chains generated:
- a 5.5 percent increase in same-store sales, compared with a 5.5 percent decline among chains selling fewer lower-calorie servings;
- a 10.9 percent growth in customer traffic, compared with a 14.7 percent decline; and
- an 8.9 percent increase in total food and beverage servings, compared with a 16.3 percent decrease.
Select the service that is right for you!COMPARE ALL SERVICES
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
- Real Money + Doug Kass + 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV