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2010’s Twenty Largest Fast-Casual Franchises

CHICAGO – The year 2009 was tough for a number of big fast-casual franchise chains. 

The following list of the 20 largest fast-casual franchise chains by network sales volume, researched by Technomic, Inc. and sorted by franchise chains by Blue MauMau, helps buyers understand what are the largest, most established chains.

Why is that important? Think stability. The largest fast-casual franchise networks,  which are considered more "upscale" fast food restaurants than quick service restaurants such as McDonald's, Burger King or Quiznos, are less likely to disappear as a brand tomorrow. That's comforting when one considers that small new franchisors fail at an even higher rate than independent businesses.

A word of caution: Being a franchise unit in the biggest system by sales does not necessarily mean that its franchise owners have strong profits.







Rank

Chain Name

2009 US Sales ($000)

% Change

2009 U.S. Units

% Change

1

Panera Bread

$ 2,796,500

7%

1,304

4%

2

Zaxby's

$ 718,250

8%

492

7%

3

El Pollo Loco

$ 582,000

-7%

415

1%

4

Boston Market

$ 545,000

-8%

520

-6%

5

Jason's Deli

$ 475,870

2%

214

10%

6

Five Guys Burgers and Fries

$ 453,500

50%

547

52%

7

Qdoba Mexican Grill

$ 436,500

7%

510

12%

8

Einstein Bros. Bagels

$ 378,444

3%

532

7%

9

Moe's Southwest Grill

$ 358,000

2%

406

3%

10

McAlister's Deli

$ 351,960

3%

290

4%

11

Fuddruckers

$ 320,500

1%

228

4%

12

Wingstop

$ 306,606

20%

433

9%

13

Baja Fresh Mexican Grill

$ 300,000

-6%

270

-5%

14

Schlotzky's

$ 248,000

-2%

345

-1%

15

Corner Bakery Café

$ 235,029

1%

115

2%

16

Fazoli's

$ 235,000

-11%

243

-12%

17

Noodles & Company

$ 230,000

15%

229

13%

18

Bruegger's Bagel Bakery

$ 196,000

-2%

295

3%

19

Donatos Pizza

$ 185,000

5%

180

2%

20

Cosi

$ 168,500

-4%

146

-3%

Source: Prepared from Technomic's 2010 Top 100 Fast-Casual Chain Restaurant Report

First, the good news. With 2009 sales of nearly $2.8 billion, Panera Bread, which in Saint Louis is known as the Saint Louis Bread Company, is the goliath of the fast-casual segment in terms of total sales. Bar none. All other fast-casual chains dwarf in comparison with Panera in terms of sales and units. The chain saw a 7.1 percent increase in sales over 2008. During tough times, U.S. units increased by 4.3 percent to 1,304 stores.

Virginia-based Five Guys Burgers and Fries saw a visit from President Obama and Vice President Biden broadcast on many major television stations last year, which ignited even more interest in franchise units. Total network sales grew by 50 percent as its number of stores grew by about the same amount, 52 percent. Having sold franchises since 2002, the chain became the sixth-largest fast-casual dining chain in the nation at the close of 2009.

Noodles & Company grew the second fastest in units at 13 percent.

Last year saw some losers too. With a shrinking number of restaurant units, Fazoli and Boston Market were the two hardest hit brands among the top twenty. These chains contracted in restaurants by -11 percent and -8 percent.

But it was not a bad year for the sector as a whole. Fast-casual restaurant chains benefited from consumers trading down from full-service restaurants to lower-priced eateries. Sales in 2009 for the top 100 fast-casual chains reached $17.5 billion, a 4.5 percent increase over 2008, and units grew by 4.3 percent to 14,777 locations, according to Technomic. Bakery and bagel cafés were the most prevalent type of fast-casual chain, jumping from 17 percent to 21 percent of a list of 100 largest in 2009. Mexican and Asian were the second and third most common menu categories.

"Growth within the fast-casual segment reveals positive consumer preferences for the service format, concept and menu positioning, and price points." says Darren Tristano, EVP at Technomic. "But competition is still fierce and dining-out dollars are still minimal. Fast-casual operators will have to continue being creative with value-oriented menu offerings, uniqueness in terms of flavor, preparation and quality, and new ways to bolster the bottom line."

Most aggregate sales growth for brands on Technomic's full list of 100 fast-casual firms was a result of unit expansion throughout the year.

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