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Wednesday, 23 October 2013

Industry: Fast Food Restaurants

The quick service restaurant industry has a significant value in the American economy. In both 2002 and 2007, the U.S. Census Bureau (2007) reported that quick service restaurants accounted for about 35% of all restaurant sales in the United States.


The picture above presents that on the fast food market in United State operate lot of companies and the competition is very high. Restaurants have to strive to encourage customers to choose them and not the others.

In general people love fast food because of the taste and reasonable prices. However, by such factors as rising food costs, economic recession and changing perceptions about health the fast food market is facing a lot of challenges. What is more, demand is driven by demographics, consumer tastes and personal income. In the United Stated where the fast food industry is highly competitive and mainly dominated by large companies the challenges are bigger. The profitability of individual companies depends on efficient operations and high volume sales. Large companies have advantages in purchasing, finance, and marketing. Smaller companies can compete effectively by offering superior food or service.

Negative publicity vs profits

Popular books such as Fast Food Nation and documentaries like Super Size Me have increased public awareness of the negative health consequences of fast food. Over the last decade there has been increased focus on the quality of food served. However, even after such publications the fast food market is doing well. Over the forecast period, fast food in the US is predicted to rise by a 3% to achieve US$237.1 billion in sales in 2017. With a 5% increase in total value sales in 2012, the largest growth rate since 2007, fast food experienced a good year.

In or out?

As as we showed Subway and Burger King are in the ranking of the biggest players in the U.S. But, the latest research shows that the most loved American fast food chain in the past 12 months was Subway and the most hated was a Burger King.


This fact confirms that the market is flexible, changeable and companies must do their best to keep loyal customers.

N.B

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