Big Restaurant Chains Stall in '08
CHICAGO - Sales growth at America's 500 biggest restaurant chains slowed in 2008 to 3.4 percent, down from 5 percent in 2007. According to Technomic Inc., the 2008 growth was largely driven by quick service restaurants like Subway.
"As the U.S. economy slid into recession last year, restaurant operators faced a host of challenges, including cost pressures followed by declines in consumer dining demand, said Ron Paul, President of Technomic. "Many chains scaled back their U.S. unit expansion efforts, growing units by just 1.8 percent compared with 2.6 percent a year ago."
The Ten Fastest-Growing Franchise Chains with Sales Over $200 Million
Ranked by Percentage Increase in Sales in 2008 vs. 2007
| Rank | Chain | Sales ($millions) | % Sales Change | % Unit Change |
| 1 | Five Guys Burgers and Fries | $302 | 59% | 49% |
| 2 | Jimmy John's Gourmet Sandwich Shop | $497 | 29% | 28% |
| 3 | Noodles & Company | $200 | 25% | 19% |
| 4 | Wingstop | $255 | 24% | 19% |
| 5 | Buffalo Wild Wings | $1,229 | 21% | 14% |
Source: Technomic
Three chains with estimated sales over $2 billion achieved estimated double-digit growth in 2008. They were Subway (17.1 percent), Panera Bread (16.2 percent) and Chick-fil-A (12.2 percent).
Limited service franchisor giants such as Panera Bread and Burger King had estimated sales increases of 16.2 and 6.6 percent respectively. McDonald's, the largest U.S. restaurant chain, grew an estimated 4.4 percent with sales exceeding $30 billion. Subway continued to dominate with 17.1 percent sales growth and total sales of $9.6 billion, considerably better than the collective 9.1 percent growth posted by other sandwich chains in the Technomic Top 500 Chain Restaurant Report. It is now the second-largest restaurant chain in the U.S., followed by Burger King, Starbucks (with some licensed outlets) and Wendy's Old Fashioned Hamburgers.
Full-service chains within the Technomic Top 500 as a whole grew at a rate of 0.9 percent. The real story was in the varied menu category which posted sales growth of only 1.5 percent compared to 5.4 percent sales growth in the prior year. This category was affected by slowing unit expansion, closures, pressures from fast-casual chains at lunchtime and retailers going after dinner business.
Growth continued to be driven by fast-casual chains. One standout was the chicken segment, which included Wingstop and Zaxby's, whose estimated sales growth was 23.6 and 17.9 percent respectively.
