The Current State of QSR with 7 Restaurant Leaders

Over the last few months, we’ve seen quick service restaurant and fast casual dining brands continue to grow rapidly across the franchise marketplace. Several of the most established names in the space have been jockeying for position at the top of the market, while many exciting new brands are also scaling to meet the needs of a consumer base that’s increasingly looking for personalization and a smooth experience.

“We just went through the most challenging time the restaurant industry’s ever seen coming out of the pandemic — from supply chain challenges to rising costs. As I look forward, I see us moving into what could be the absolute best period that I’ve spent in the restaurant business. We’re very optimistic and excited about that.” – Bob Andersen, President, The Great Greek Mediterranean Grill

“ We’re beginning to see a really big shift in the restaurant space. The middle section of restaurants, meaning the mom-and-pop restaurants, are getting eaten alive. You have to go either high-end or QSR and scale to make it in the U.

S. because of the regulations, the costs of products, the rising oil prices. So, it’s really eating away at a lot of margins in the middle.

QSR is having a moment because we’re able to scale and get better prices and better products for the buying power that we have and then provide the customer with a better experience in terms of quality and value.”

“When I started my career, there wasn’t a lot of choices in QSR or casual dining. I mean, you look at every market now, and it’s beset with competitive intrusions – so many new concepts coming in. It’s a very exciting time from that standpoint because now you have to think about differentiation and standing out amongst the crowd. At the same time, there are also macroeconomic challenges: inflation, gas prices, and so on. From a franchisee perspective, the lending environment has gotten a little tougher.” – Jorge Salvat, CEO, Another Broken Egg Café

“I just think franchising is the future. The way I look at it, the franchise model reduces the uncertainty of launching a restaurant concept because they’ve already established their brand, built operating standards, and created resources for training, marketing, and attracting customers. In return, I own local execution, company culture, and customer relationships. There’s a balance between independence and support there.” – Mohammed Azam, Franchisee, Charleys Cheesesteaks

“Our mission is QQC: quality, quantity, and customer service. Obviously the quality of the food is key. Quantity means we want to control the supply chain so we could get the best prices for our customers, meaning both the franchisees and their customer base.

Getting great value from the money the customer is spending is huge nowadays because everything’s getting more expensive. When a private equity company buys out a QSR brand, the first thing they do is they lower the volume and make the product smaller and smaller, and then you have an exodus of your loyal customer base. Quantity is important.

We want the customer to feel full every time. And finally, it’s the customer service. And, with QSR it’s a little bit less important compared to sit-down restaurants, but it is still extremely important.”

“We want to serve a better-for-you product that’s made in our restaurants, fresh, flavorful and customized to your tastes. We want people who are committed to that. If someone’s not committed to that in our business, then whatever other experience or qualifications they have don’t seem to matter.” – Bob Andersen, President, The Great Greek Mediterranean Grill

“We’re currently rolling out a new unified guest experience management system, a GEM. It’s going to consolidate customer reviews, feedback, surveys into one platform for monitoring guest sentiment. Previously, we’ve had to scrape our feedback and customers’ comments from a variety of sources.

It really took time and energy to fully understand how a team was doing and how we could focus our coaching to improve operations. This is going to streamline that whole process and give us the opportunity to react immediately to a customer concern.”

“Charleys focus on food was really important to me. I just love their emphasis on food and product quality. Their menu offers familiar food with broad customer appeal, and everything is prepared fresh in a way where the customers can see their meal being made in front of them. I’m a big fan of small towns. A lot of people don’t recognize the potential these small towns have. You have a very loyal customer base. Everything that you do is highly appreciated by them.” – Mohammed Azam, Franchisee, Charleys Cheesesteaks

“The category is still in its infancy stage. The consumer is continuously looking for convenience, personalization, and customized food, and they want healthy, better-for-you options that are really flavorful.” – Bob Andersen, President, The Great Greek Mediterranean Grill

“QSR is doing well compared to other kinds of restaurants. I think we’re in a good space leaning into product quality and health as more people try to be healthier and more fit.” – James Deng, Founder, Poké House

“Now there’s a place where, even if you don’t have a lot of franchise experience and you don’t have a huge amount of capital, you can start building, not only a great business, but also a very impactful business that brings healthy food into the communities that you want to operate in.  One of the things that I love about my career is I found a business where I could drive a lot of wealth if we’re hugely successful – the American dream of entrepreneurship – and it has this deeper sort of purpose and impact. And I think the really exciting thing for franchisees is that they can do that too.

It’s a really fulfilling and financially rewarding situation.”

“In terms of our growth, we’re going to be at somewhere between 25 and 30 restaurant openings per year the next few years. That’s where we’re targeting. We’re not looking at bringing in a ton of franchisees. We’re looking at bringing in the right franchisees, probably somewhere around 10 to 13. I think it’s really critical for us to make sure that we’re bringing in the right partners — and, by the way, we want to make sure that we’re the right partners for them as well.” – Jorge Salvat, CEO, Another Broken Egg Café

“Our goal for corporate growth would be to continue on a five-store-a-year pace. We don’t want to overdo it and try to do 15 at one time or so, because then we won’t be able to focus on the franchise side. So, I think comfortably we can add five stores a year on the corporate side in Texas.

And then on the franchise side, the goal for this year was to sell five franchises. Hopefully we can meet the right people. I think 5 this year, then 10, then 15 is realistic and doable.

We don’t want to do it too fast either. We don’t want to sell too many and, and we want to do it right. We want to grow.

We’re not really interested in growing. We’re more interested in growing right than we are interested in growing fast.”

“We’re focused on sustained growth because, growth is great, but we don’t want to grow into areas where it’s not sustainable. For example, we got offered a Times Square location in New York City, and the mathematics just didn’t make sense from a development standpoint. It would’ve been our only unit in New York, and then we don’t have supply chain support of that area.

So, we’d need to grow regionally first to really make that work. The ability to support the locations and franchisees, that’s really our guiding light. We want to grow into a great restaurant chain, and a great restaurant chain doesn’t necessarily need extremely high growth.

In-N-Out was only in California for many years, and they’re doing amazing. If we grow into a great brand, the number of units and development opportunities is going to come later. Number one is focusing on the brand.”

“We’re not desperate to sell franchises. We’re not in a hurry. When it comes to working with franchisees, we want to make sure we’re the right fit.

That’s so critical for us. The franchisees need to have the same mindset that we do to protect the brand and culture. We’re creating an environment where people are happy and providing exceptional food and world-class service.

It’s a family. We need to be able to have a good relationship and get along and hold the same values. And then, when you protect the brand, I’m going to protect you.

We don’t want to sell a franchise to someone who isn’t going to be a good fit because we plan on being around for a long time – that’s the foremost thing for us.”