| Baked
not fried - bakery fast food shows strongest growth in US
fast food
5
Jan 2006
The
bakery products sector is the clear winner of the US fast
food market, according to a new report from Euromonitor International
– “Consumer Foodservice in the USA”.
The
bakery products fast food sector is home to a number of chains,
including Subway, Krispy Kreme, Panera Bread Co and Quizno's,
all of which realised exceptionally strong growth in 2004.
These chains experienced gains in units, transactions and
value sales that topped all other fast food chains. According
to Euromonitor International's research, bakery products fast
food witnessed value growth of nearly 5% between 2003-2004,
whereas the burger and chicken fast food sectors showed only
1.6% and 2.8% value growth, respectively. The high growth
achieved by bakery fast food is even more remarkable considering
that it is the second largest fast food sector, following
only burger restaurants.
Health
consciousness and outlet expansion drive growth
Euromonitor International's research shows that a number of
factors are responsible for driving growth in the bakery fast
food sector. Firstly, the entire fast food industry, including
the bakery sector, has benefited from the increasingly fast-paced
nature of US consumer lifestyles. Thanks to their “on-the-go”
lifestyle, Americans are increasingly choosing fast food because
they have less and less time to cook.
Secondly,
the bakery sector witnessed growth due to the growing health
consciousness of US consumers. This has seen consumers choosing
healthier options, such as fresh sandwiches, soups and salads,
instead of the traditional option of burgers and fries.
But
perhaps the most compelling reason for the success of bakery
fast food is their ability to easily open new outlets. Restaurants
such as Subway, for example, often require little or no cooking
apparatus, which means they can open a restaurant in smaller
locations that are not necessarily suitable for a large burger
restaurant. Euromonitor International's research shows, for
example, that the number of outlets in the bakery fast food
sector grew by 4% between 2003-2004, compared to only 0.7%
for burger chains.
Success
stories
Subway is the main success story of the bakery fast food industry.
The chain achieved a milestone in 2001 by surpassing the number
of McDonald's units in the US. Growth of the chain has been
strong ever since, largely on the back of its healthy reputation
and offering of fresh food. Recently, however, the chain has
achieved success by adding more upscale products to its menu,
such as “artisanal” breads, that are more commonly
found in fast-casual restaurants.
Outlook
While Subway takes the high road with regards to health, another
bakery fast food chain is realising excellent results with
one of the more fattening foods – the doughnut. Krispy
Kreme trades primarily on the popularity of its raised, glazed
doughnuts, which are served freshly made and hot. Due to its
fanatical following, Krispy Kreme is now the third-largest
chain the sector, growing sales by 12% in 2004 and building
on the 24% increase of the previous year. Krispy Kreme is
also notable for its focus on multiple-portion sales, with
the company choosing less-convenient locations in the hope
that, once there, consumers will take a dozen or two doughnuts
for consumption later. |
