Record Crowd at This Year's Kickoff Event!
Thank you to everyone who attended
DMA's 3rd Annual Party at the Post Office!
What a great way to kick off this year's National Restaurant Show week! Thanks to the more than 100 operator brands (including our new friends from the healthcare and C&U segments) represented at the event...and, of course, DMA's Member distributors who support those Superior Operator Partners every day. If you'd like to see the photo gallery from the party, please follow DMA on LinkedIn for more details. We hope to see you on the rooftop next year!


Restaurant Chains Dominate Top 10 Fastest-Growing Retail Brands

Yelp has released its first-ever list of the 50 fastest growing retail brands in the U.S. The review site compiled its report by using a blended metric that includes net new openings, searches on its platform from 2022 to 2023, and consumer interest.

Of the 50 fastest-growing chains, 35 were restaurant brands. Furthermore, chains owned by publicly traded restaurant companies account for half of the top ten.

Notably, the data demonstrates momentum for "challenger" food, restaurant, and retail brands that are quickly becoming the next class of household favorites.

Challenger brands—defined as businesses that are not market leaders but aim to compete by disrupting their industry—make up over 70% of the brands on the list.

Here are Yelp's top ten fastest-growing retail brands, with additional reporting by CNBC:

10. Jersey Mikes

Jersey Mike's is the second-largest U.S. sandwich chain after Subway. Its current footprint hovers around 2,700 restaurants, but the chain is growing rapidly. Despite its name and origin, most of its restaurants are now in California, Texas, and Florida.

9. Olive Garden

The gem of Darden Restaurants' portfolio, Olive Garden accounts for nearly half of the company's overall revenue. The Italian-inspired chain casual-dining chain also opened new locations recently, adding about 20 new restaurants in its fiscal 2023.

8. Rally House

The sole apparel retailer to land a place in Yelp's top 10, Rally House sells team gear and sports apparel for professional and college teams. The company has been setting its own record for new openings. In August, it opened seven locations in a single weekend.

7. Freddy's Frozen Custard & Steakburgers

This Midwestern fast-casual chain sells comfort food that reflects the nostalgic warmth and familiarity of the region's cuisine. Last year, Freddy's opened 62 new locations, setting a new development record for the chain and surpassing 500 locations overall.

6. Popeyes Louisiana Kitchen

In 2023, Popeyes surpassed KFC as the second-most popular chicken chain in the U.S. by sales, trailing only Chick-fil-A.

As the "Chicken wars" top contender, Popeyes led a pack of comfort food spots touting fried chicken with a nationwide consumer interest increase of 34%. The chain was also the third fastest-growing brand in the Northeast, where it saw a 52% bump in consumer interest.

5. Wawa

Known for its made-to-order cheesesteaks and hoagies, Wawa has been expanding outside its Philadelphia stronghold into new markets down the Atlantic seaboard. The convenience store and gas station chain has also been opening drive-thru locations, encroaching further on restaurants' territory.

4. The Habit Burger Grill

When Yum Brands bought The Habit Burger Grill in 2020, its footprint was less than 280 restaurants. At the end of 2023, the chain had 378 locations on the East and West coasts.

3. LongHorn Steakhouse

Since the pandemic began, sales at the casual-dining chain LongHorn Steakhouse have consistently outperformed the restaurant industry's average, fueled in part by the strong growth of its takeout business.

2. Scooter's Coffee

Founded in in Nebraska 1998, Scooter's Coffee has only recently begun aggressively expanding through franchised locations. The Midwestern coffee chain's standard, drive-thru-only location is only 664 square feet, making it quick to build and cheap to operate.

Scooter's net new locations jumped 53% from 2022 to 2023, giving it the largest percentage growth of any restaurant brand on Yelp's list.


As a Yelp Challenger Brand, CAVA saw a 54% increase in consumer interest nationwide from 2023 compared to 2022, not to mention claiming the fastest growing brand spot in California, Colorado, Pennsylvania, Georgia, and Alabama.

Best known for its Mediterranean-inspired bowls, fast-casual restaurant's drinks are now rising in popularity. Yelp's review insights revealed that CAVA's beverages, including pineapple apple mint and blueberry lavender, are what keep customers coming back. Yelp users continually praise these drinks for their taste, quality, and customization options. Food Institute Focus

AWSM Sauce is the world's first sustainability focused sauce and condiment brand - we are really excited about partnering with DMA member organizations to help deliver value and drive sustainability across platforms. AWSM Sauce starts as a powder - add water and mix to get all of the sauce that you know and love - with staples like Ketchup, BBQ, Hot Sauce, Mayo, Japanese-style BBQ and more in development (Ranch, Wing, etc.).

Insights tell us that "76% of CONSUMERS expect Foodservice operators to embrace sustainability and they want to know about it. Also, those insights indicate that 70% of OPERATORS are prioritizing sustainability." BOTH are looking to us to help them make tangible improvements forward. AWSM Sauce is here to help! Let's discuss how we can bring some AWSM improvements and decrease space, weight and waste. Email Mark Hayes today.

Opinion: Automation Serving up Invaluable Efficiency for Restaurants

I can't say I envisioned this back when I started in franchise development years ago, but we have invested in restaurant robotic and automation concepts. It might sound wild initially, but you have to look at it from a labor perspective.

Automation often makes sense from a financial lens. Chipotle has invested in Hyphen robotics that will reduce service times, increase consistency and eliminate labor from the restaurants and make customers' bowl items. When you visit a Chipotle, most of their locations have two lines, like most QSRs – one for their dine-in customers and one for the drive-thru. But Chipotle now is using robotic lines that actually make bowls for the online orders.

That's Chipotle's way of getting 100% consistency and knocking out a bunch of labor costs, because menu items like bowls can be automated.

In recent years, a restaurant chain in Boston called Spyce Kitchen had a robot make Asian bowls, with a tumbler that tumbled ingredients into a bowl before it was automatically cleaned. That's the definition of efficiency.

Spyce was eventually purchased by Sweetgreen in 2021, expressly for its automation and robotics.

My company is a partner with the Rise Biscuits & Chicken chain. Historically, Rise had six employees every shift – a cashier, the people making food, and an expo person delivering to customers. Rise eventually got rid of the cashier for kiosks and an app. Rise also uses a heated locker. So, just by automating those two things, Rise got rid of 33% of its labor.

The ironic thing is Rise gets voted as having some of the quickest – and best – service, with locations that garner plenty of 4-star yelp ratings or better. And it's actually less service from humans. But if you're not going to be able to staff up with cashiers that can do suggestive selling the way that an app can ... well, then you have to ask yourself if that's worth the labor cost.

You hear stories about people who order at a kiosk or on an app and it results in 17% higher sales. In that situation, the restaurant has gotten more sales even despite eliminating a position. Rise's sales rose 20% when they began using kiosks. If you think about it, most cashiers aren't great a suggestive selling, aren't incentivized to grow the check average, and just want to get on to the next customer. Kiosks always ask if customers want more – and, if you ask, you typically get. Kiosks are a no-brainer to drive sales.

And, instead of having a worker who's basically dead weight when there's no orders, with a locker setup restaurants have an employee making the food and simply sticking it in the locker while the customer gets a notification on their phone.

When considering investing in automation, you just want to make sure that you're not spending $10 to make $1.

You want to spend $1 and make $10. And that's the trick with any technology; you need to make sure, before you invest in it, that it creates efficiencies and legitimately saves you money.

But, when you do the math these days as a restaurant operator, there are certainly scenarios where turning to automation makes the most sense. Food Institute Focus

The Future of Food Delivery: Are Uber, DoorDash, and Instacart Destined to Win the Delivery War?

Has the third-party delivery business – led by DoorDash and Uber – been a success? There are several ways to answer that question – each of which provides relatively different results.

The most obvious answer is: of course. At the moment, Uber has a market cap just shy of $150 billion. DoorDash is worth $47 billion, and Instacart is just shy of $10 billion. That's a combined total over $200 billion – even if a big chunk of that comes from Uber's rideshare business – and there's likely a bit more value in GrubHub, Germany's Delivery Hero, and the few remaining startups in the space.

But there are also perspectives which highlight the disappointment of the group. Uber went public at a price of $45 per share. Friday's close of $69.23 suggests annualized returns of just 9% per year from that price. That's worse than the Standard & Poor's 500, and far worse than the NASDAQ 100, which contains the world's biggest tech stocks.

DoorDash stock is up just 11% from its IPO in December 2020 – and down 40% from where it closed on its first day of trading. Grubhub owner Just Eat Takeaway has been trying to sell the business almost since the day it was acquired for $7.3 billion in 2021 and has seen essentially zero interest. Instacart is the one (and surprising) exception: the company went public in September, and shares are +22% from their IPO price. But its valuation is also well below the $17.7 billion figure at which it reportedly raised capital in 2020.

Operating results too are in the eye of the beholder. In 2023, DoorDash posted an operating loss of $579 million. Instacart was in the red by more than $2 billion, though the issuance of stock awards related to the IPO accounts for that loss. Uber's Delivery segment posted a profit on an Adjusted EBITDA basis, but including proportionate corporate overhead that business still appears to be running at modestly negative profit.

On the whole, third-party delivery has been a success – but with the caveat that earnings, and investor returns, haven't been what optimists projected.

Looking forward, perspectives seem similarly split: valuations for Uber and DoorDash remain among the highest in the market, and so years of consistent, impressive growth remains priced in.

The good news on that front is that the losses these businesses have run so far have basically cleared the field in the future. Particularly in the U.S., competition is minimal. And so Uber and DoorDash in particular should be able to grow along with the market – which still seems to be performing well. In 2023, DoorDash increased its Gross Order Value (the total dollar value of orders placed across all categories) by 25%. Uber's delivery bookings (essentially the same figure) rose 14%, and Instacart grew 5%.

One clear strategy for maintaining those growth rates is to expand the range of products that can be delivered. The long-term future for the industry, in the most optimistic scenario, is a fleet of autonomous vehicles delivering not just food from restaurants, but essentially every consumer product available locally.

DoorDash has been particularly aggressive on this front, targeting what it calls "new verticals" including grocery, alcohol, retail, and convenience store products. It's having some success: its grocery business is growing more than 100% year-over-year, per last week's first quarter earnings call.

The other important revenue stream is advertising. Instacart generated $871 million in advertising and other revenue in 2023. Its Adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) was $641 million. Uber CEO Dara Khosrowshahi has said that the profitability of his company's grocery business will depend on ad dollars.

All told, with the dynamics of the market mostly set – though Instacart's market share remains at risk – the effort now is to build the market. Delivery companies want more dollars from restaurants, more dollars from CPG players in grocery, and, of course, more dollars from the end consumer.

And the reason why investors are willing to pay such huge valuations for these mostly unprofitable companies is that more revenue dollars mean sharply higher earnings. The added cost of advertising revenue is close to zero; the incremental expense of an additional order (beyond driver costs) is relatively small as well. And so, a business that is running breakeven at $30 billion in bookings can generate hundreds of millions of dollars in profit at $40 billion in bookings. A DoorDash that truly covers the entire local retail landscape can be worth multiples of its current $48 billion market capitalization.

The irony, however, is that all of these strategies, and all of these numbers, essentially boil down to a simple question: how much are consumers willing to pay for convenience? DoorDash and Uber can expand into new markets and create new ad revenue streams, but the long-term case requires steady growth within each of those categories. And it's possible that at some point, the base of consumers willing to pay fees and tips that often exceed $20 for a single order is completely captured.

For now, however, both the companies and their investors believe that point is a long way off. For the delivery industry, it remains full speed ahead. Food Institute Focus

Store News:

Red Lobster has filed for bankruptcy. The largest seafood restaurant chain in the U.S. will sell its entire business to an entity formed and controlled by its existing term lenders, and the chain said it has been working with vendors to ensure normal operations. Red Lobster received a commitment of $100 million in debtor-in-possession financing from existing lenders, reported The Wall Street Journal (May 20). Full Story

Starbucks' new cold cups will use far less plastic. Most of its sales now derive from cold coffee, and its new sustainable cups cut plastic use by up to 20%. The cups will debut in the U.S. and Canada soon and keep more than 13.5 million pounds of plastic out of landfills each year, reported Restaurant Business (April 18). Full Story

Bojangles has plans to open 30 locations in Southern California by early 2025. The company announced last year that it planned to open 20 more stores in the Las Vegas area, reported Eater (April 16). Full Story

Pizza Hut has invested in sustainably sourced cheese with the Dairy Farmers of America. The chain restaurant indicated positive results from a sustainable cheese project in the U.S. and has launched multiple pilot programs in global markets that include the U.K. Full Story

Chipotle Mexican Grill has ended Farmesa, its virtual brand experiment and restaurant. Little over one year after announcing Farmesa, Chipotle called it quits and sold the concept through United Kitchen's Santa Monica location. Chipotle executives told CNBC that the company won't be opening a brick-and-mortar version but hopes the brand will live on through the innovation lab, reported QSR Magazine (April 26). Full Story

Meanwhile, in California, Chipotle raised menu prices by up to 7%. The new minimum-wage law pushed the chain's wages up 20% and menu price hikes will cover the cost. Chipotle had robust first-quarter traffic up more than 5%, and executives say they aren't worried about the cost of doing business in the Golden State, reported Restaurant Business (April 24). Full Story

Shake Shack partnered with Avocados from Mexico to bring avocado experts into select locations on April 25 and 26. Restaurants in New York, California, Pennsylvania, Texas, and Florida hosted visiting avocado sommeliers to help guests pick from a selection of avocados, choose their preferred fruit, and see it sliced in front of them before being added to a sandwich. Full Story

Cava will soon bring its bowls to the Midwest as the Mediterranean fast casual will debut Friday in Chicago with plans to open more restaurants soon, reported Restaurant Business (April 25). Full Story

Domino's will pay customers to tip their delivery drivers. If customers tip $3 or more, they'll earn a $3 discount for their next delivery order, reported Restaurant Business (April 25). Full Story

Burger King will invest another $300 million to remodel its restaurants. Overall, the company will spend over $2.2 billion to revive its fast-food businesses and expects 85% - 90% of its roughly 7,000 restaurants to have the same modern design by 2028, reported CNBC (April 30). Full Story

TGI Fridays Inc. has paid back about half of its existing asset-backed bonds after selling a licensing business to Kraft Heinz. The companies struck a deal earlier this week, which allowed Kraft Heinz to continue selling TGI Fridays food products and control the license, reported Bloomberg (May 3). Full Story

Panera Bread plans to phase out its "Charged Sips" line of caffeinated drinks. The beverage line has faced several lawsuits by people claiming the drinks caused health problems, reported Reuters (April 7). Full Story

McDonald's will offer a $5 value meal next month to counter slowing sales and customers' frustration with high food prices. The deal will feature a four-piece McNugget, small fries, a small drink, and either a McDouble burger or a McChicken sandwich; the deal is scheduled to debut June 25 in most markets, reported ABC News (May 16). Full Story

Meanwhile, McDonald's is phasing out free drink refills in what may be a sign of a broader fast-food trend. TikTok-famous ex-McDonald's corporate chef Mike Haracz also recently addressed the controversy, saying that drink theft was likely part of the brand's rationale, reported New York Post (April 15). Full Story

Popeyes has unveiled its new Golden BBQ Chicken Sandwich, the latest innovation in its famous chicken sandwich lineup. The brand has also partnered with New Orleans hip-hop duo SaxKixAve, who has released the "Bring Back Lunch" anthem on TikTok to promote the brand's new sandwich deal. Full Story


Beef. It's Still What's for Dinner

Prices, environmental concerns, and healthier eating advice be damned: 70% of consumers still want their beef. That's the latest from Technomic's 2024 Center of the Plate: Beef and Pork Consumer Trend Report.

The report found the demand for protein has driven an increase in beef purchases at food service locations since 2022, with restaurants being a significant driver.

The consumer love affair with beef continues despite the latest Bureau of Labor Statistics figures that reveal beef prices are up as much as $2 per pound compared to last year; recent environmental reports estimate the beef industry contributes 14.5% of global greenhouse gas emissions, mainly in the form of methane; and advice from healthier eating advocates urges Americans to consume a more plant-based diet.

Registered dietitian Catherin Rall told The Food Institute much of the attraction of beef is cultural.

"A lot of people see beef as a premium meat and associate it with things like prosperity and masculinity. 

Beef is also incredibly rich in fat and protein, so our bodies are primed to crave it," Rall said, noting federal subsidies, restaurant menus, and advertising all reinforce beef's place "in our grocery stores and on our table."

That doesn't mean consumers are ignoring price. Online meat purveyors like Omaha Steaks and Meat N' Bone said there's growing interest in buying meat directly from farmers and stocking their freezers.

Omaha Steaks has seen a 52% increase in business since 2019. Nate Rempe, president and CEO, Omaha Steaks, said the industry is expecting a 3% drop in production this year, which likely will have an impact on prices.

"Rising meat prices are often most noticeable at your local grocery store and restaurants which typically have quicker reactions to supply chain price increases they pass on to their customers. Those more dependent on imported meats often see prices rise due to transit, too, versus those of us based in the Heartland," Rempe said.

"Many Americans have adapted by being smarter shoppers and looking beyond prices alone, but value – particularly with meats. The average American family throws out $1,600 of food each year due to spoilage. That's a significant dent in an already increased food bill for most."

Gabriel Llaurado, co-founder chief marketing officer of Meat N' Bone, said consumers also are interested in premium cuts sourced from smaller farms with high-quality programs.

"Yes, folks are still hankering for their steaks despite market pressures at the moment," Llaurado said.

In other words, there's no need to chew the fat with your local butcher about their summer prospects with expensive beef prices – they're probably doing just fine. Food Institute Focus

Work Smarter, Not Harder with Dawn Professional
P&G Professional, in partnership with media personalities and restaurateurs Ashley Iaconetti and Jared Haibon, launched its new reformulation of Dawn Professional Manual Pot and Pan detergent. This detergent, with its two times longer lasting suds compared to Dawn non-concentrated, is specifically designed for commercial use. See Jared's successful test at Audrey's Coffee Shop and Lounge. For more details, visit DMA Delivers


Restaurants Post First Y-o-Y Increase of 2024 in March

Comparable restaurant sales increased 0.6% in March as comparable traffic ticked down 2.2%, according to Black Box Intelligence. Black Box noted the industry was certainly seeing slowed sales growth in 2024, but March represented the first month of year-over-year sales growth. Full Story

Selected Results:

Chipotle Mexican Grill raised its full-year sales forecast after reporting resilient demand despite higher menu prices. The company expects same-store sales growth in the mid-to-high-single digit percentage, reported Reuters (April 25). Full Story

Domino's reported U.S. same-store sales growth of 5.6% in its first quarter, beating estimates of a 4.04% increase. The company has managed to buck a downbeat trend in eating out by leveraging its loyalty program and promotional offers, reported Reuters (April 29). Full Story

McDonald's posted global same-store sales growth of 1.9% in its first quarter, falling short of analyst estimates of 2.35%. The company raised prices by roughly mid- to high-single-digit percentages over the last year in response to rising prices in eggs and other raw materials, reported Reuters (April 30). Full Story

Starbucks reported global same-store sales fell 4% during the second quarter as sales fell 11% in China and 3% in the U.S. The company cut its annual sales forecast following the first fall for same-store sales in nearly three years, reported Reuters (April 30). Full Story

Yum Brands' earnings missed estimates as sales at Pizza Hut and KFC disappointed amid an inflation-riddled economy. Both chains reported same-store sales declines while Taco Bell's same-store sales rose just 1%. Yum said its digital sales accounted for more than 50% of sales for the first time, reported CNBC (May 1). Full Story

Texas Roadhouse continues to thrive as the chain reported another quarter of solid sales and traffic growth. The chain said same-store sales increased 8.4% year over year at its company-owned restaurants with 4.3% traffic growth, reported Restaurant Business (May 3). Full Story

Applebee's endured a 4.6% year-over-year sales decline in Q1 2024. Inclement weather and a slowdown in consumer spending accounted for the losses, though President Tony Moralejo is confident the chain can hit its same-store sales targets for the year by enticing consumers with $1 margaritas and other deals the chain has historically been known for. Full Story

For regional chains looking to grow quickly and selectively across the US, DMA Offers the one national network that can be customized specifically to your needs to serve your long term expansion plans.

DMA Delivers

Newsletter Email Sign-Up