Economic Trends of the Restaurant Industry

967 Words Jan 12th, 2018 4 Pages
What firms have exited the industry? What firms have entered or increased investment in the industry? ( 250 words)

The restaurant industry is expected to grow a little over three percent from fiscal year 2011 to 2012 and reach a record high of total volume of over six hundred thirty two billion (National Restaurant Association, 2012). The largest market segment is growing steadily and consists of tableservice sales. Quickservice establishments have also fueled industry growth and a host of narrow niches have also posted record growth such as the hospital foodservice niche and the military foodservice niche. The growth rate of the industry in general makes the industry attractive in regards to future development. However, there are many external factors that are also putting pressure on the industry. The biggest threat to the industry is higher food costs. Wholesale food costs are experiencing roughly an eight percent inflation rate which is the highest in about thirty years. Therefore despite the industry growth, inflation will continue put pressure on industry margins. Some national chains have continued their growth spurts through this period, such as McDonald's and Starbucks, however there are many who were not as fortunate such as Sbarro and Marie Callender's (Bite Club, 2011). There are also many new trends that are working…
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