How Chick-Fil-A is fighting its way back to number one in the fast food market

How Chick-Fil-A is fighting its way back to number one in the fast food market

For nine years in a row, Chick-fil-A took first place as America’s best fast-food restaurant in the USA Today Readers’ Choice Awards, but this year it was knocked off the throne by Mexican-American chain Del Taco.

That’s a remarkable achievement for a chain with fewer than 600 stores in 18 states, concentrated in the Southwest – California has nearly 400 stores – and the South; there is not a single store in the Northeast.

To make matters worse, Kentucky Fried Chicken has also overtaken Chick-fil-A to become the number two fast food restaurant. KFC’s rise is probably not so much due to the Colonel’s secret recipe, but to the fact that the company relies on cheap prices.

Inflation-hit Americans aren’t visiting fast-food restaurants as often as they once did. A LendingTree survey of 2,000 adults found that nearly 80% consider fast food a luxury because of high prices and 62% are indulging in it less often. And Chick-fil-A is named the highest-quality fast-food chain (25%), followed by Starbucks (22%) and Chipotle (21%).

But Chick-fil-A isn’t giving up its top spot without a fight. The company is introducing new retail formats to bring some speed back to the fast-food experience.

And Deadline just announced that Chick-fil-A is launching a family-friendly content streaming service so customers can enjoy the full Chick-fil-A experience at home, even when they’re not snacking on their Chick-fil-A takeout.

New stores offer better food faster

Compared to other fast food restaurants, Chick-fil-A is known for its fresh, high-quality ingredients and exceptional customer service that other fast food restaurants rarely offer.

Despite closing on Sundays, the chain has quite impressive financial numbers, according to the report from QSR, which compiles the private company’s data from its franchise disclosure documents.

Chick-fil-A now has nearly 3,000 locations, making it the third-largest fast-food chain behind McDonalds and Starbucks, with revenue of $21.6 billion in 2023, up from $18.8 billion in 2022.

The 2,000 stand-alone franchise units generate average annual revenue of $9.4 million, up 8% from $8.7 million in 2022. According to equity analyst Mark Kalinowski, a typical Chick-fil-A restaurant generates less than half the revenue of a McDonald’s unit, which averages about $4 million per unit.

After opening nearly 150 new locations last year, Chick-fil-A plans 183 new restaurants this year and is introducing two new digitally-powered retail formats into the mix: a walk-up store with no in-store dining and an expanded drive-thru concept with the kitchen on the second floor. Both new store models are now live.

The walk-in, mobile pickup location opened on New York’s Upper East Side last March. With no seating or self-service vending machines, it’s designed for busy urban areas where time is precious and people eat on the go.

After a customer places an order through the brand’s mobile app, service staff are notified via geofencing when the customer is within range so the order can be timed to coincide with their arrival. An active status board also displays the status of orders.

The new drive-thru location just opened in a suburb of Atlanta. It is a four-lane model with a capacity of 75 cars at a time, solving the constant traffic problem at the usual locations.

Cars drive through the ground floor where waiters hand-deliver food orders; there are no windows to pass orders through. And the food is prepared on the second floor in a kitchen twice the size of an average store. An automated food transport system – a “smart” dumbwaiter – brings the orders to waiters on the ground floor.

Jonathan Reed, the company’s design director, told Nation’s Restaurant News that this store could handle up to three times the sales of a regular Chick-fil-A and that the drive-thru and digital channels account for the majority of Chick-fil-A’s sales.

“In our business, seconds and inches matter,” Reed said. “People’s time is a precious commodity. The fact that they come with their money, give us their time, give us their hard-earned resources, we never want to take that for granted.”

More innovations are planned. QSR reported that the company plans to invest $1 billion in international expansion in Europe and Asia by 2025, with the goal of being present in five international markets by 2030. In addition to the United States, the company currently operates in Canada and Puerto Rico.

Becoming a cultural force

Chick-fil-A is already a cultural icon in some circles, but the company wants to expand its cultural influence even further. Company founder S. Truett Cathy’s decision to close his Georgia restaurant on Sundays was nothing unusual in 1946, but the fact that it remains closed today, 80 years later, really sets the company apart.

Chick-fil-A has always been a purpose-driven company that bucks the secular mainstream. “We seek to glorify God by being faithful stewards of all that is entrusted to us, and we seek to have a positive impact on everyone who comes into contact with Chick-fil-A,” the website states.

To extend that positive impact beyond its stores, Deadline just reported that Chick-fil-A is “aggressively moving into the entertainment space” and developing family-friendly shows and content, starting with an unscripted series.

Brian Gibson, producer of History’s Top Gear and Fox’s The x-factorwith the development of new unscripted content and is reportedly looking to acquire additional content.

Chick-fil-A has already tested the media space in a series of short, animated educational films for children. Stories from Evergreen Hills and started with the Pennycake brand in the area of ​​children’s puzzles and family games. The next project will follow this example.

Demand for healthier, more uplifting and family-friendly content is increasing. “Post-pandemic, the focus is on positive storytelling, which opens up new opportunities in this era of streaming,” wrote Marc Berman, also a senior editor at Forbes.com.

This is an area that another household name, Hallmark Cards, has successfully exploited for three cable networks – Hallmark Channel, Hallmark Mystery and Hallmark Family – as well as a subscription-based video streaming service, Hallmark Movies Now.

Whether Chick-fil-A can do the same, or even aspires to do so, is the question. Chick-fil-A did not respond to a request for comment. However, the company has always served its chicken sandwiches with a side of warmth and neighborly friendliness.

That’s not far from Hallmark turning greeting cards into stories for television. Chick-fil-A clearly sees a growing appetite for family-friendly content that needs to be satisfied.

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