Blurring the Lines Between Traditional Foodservice Dayparts
By Dwayne Reno
Blurring the lines between the traditional foodservice dayparts continues to grow in popularity among foodservice operators. The need to diversify has foodservice operators looking at the traditional dayparts with renewed focus and interest. Fixed costs such as rent has operators looking for creative ways to increase foot traffic and profits. This month I would like to take a look at the different dayparts and how foodservice operators are expanding into additional dayparts to grow traffic.
What are Traditional Dayparts?
The term traditional daypart covers the three main meals of the day, which are breakfast, lunch and dinner. For example a breakfast only restaurant will be busiest during the breakfast daypart while other operators will see traffic during the lunch and dinner dayparts. However, many operators have started to diversify their menu offerings in hopes of attracting different pools of customers throughout the day.
Breakfast the Most Important Daypart of the Day
The breakfast daypart represents 21 per cent of foodservice visits and is the main reason behind the current food wars. Earlier this year McDonald’s, and A&W, started offering all day breakfast to the delight of fast food lovers in Canada. However, McDonald’s started offering all day breakfast back on Oct 6, 2015, in the U.S. With sales in a bit of a downward slope the fast food giant saw this as a way to boost sales now that competitors such as Taco Bell, Subway and Dunkin Donuts all serve breakfast.
The push into the breakfast daypart by the fast food higher-ups comes as no surprise. Recently the NPD Group stated that the breakfast daypart has been the fastest growing daypart since 2012. The report also stated that breakfast sandwiches were the second fastest growing menu items, behind coffee.
Lunch Holding Firm
Lunch represents 27 per cent of daypart visits, however over the years there has seen a significant drop in visits during the lunch daypart. This is very important to note since the lunch daypart accounts for a third of all foodservice traffic, according to NPD Group. All foodservice segments are experiencing a decline in lunch visits with the exception of QSR (quick service restaurants). The QSRs have been very deal savvy during the resent lunch visit declines with dollar menus and combo deals to prevent even steeper declines.
Also, it would seem that the main reason for the decline in lunch daypart visits has to do with how much consumers are will to pay for their lunch. NPD foodservice market research shows that if you would remove the deal traffic QSRs are getting, customers would pay an average of $8.00 for lunch, much higher than most want to pay in these highly competitive times. However, the recent decline in lunch daypart visits has been seen by some as an opportunity to innovate and try to find new ways to drive traffic.
Tim Hortons CEO, Daniel Schwartz told analysts “We see lunch as a huge opportunity for us for many, many years,” during a RBI (Restaurant Brands International) quarterly earnings conference call back in 2016.
The popular Canadian coffee and donut shop has since added pulled pork, Greek salad wraps and kettle chips to help drive lunchtime visits. Though both Tims and McDonald’s continue to see solid growth in their ubiquitous breakfast sandwiches, “lunch is the battlefield” in fast food now, said industry expert Robert Carter, executive director of food service at market research firm NPD Group.
Do You Have Time for Dinner?
The dinner daypart represents 23 per cent of daypart visits and has not fared well since many operators are experiencing slower traffic during this core daypart. However it’s not all bad news during 2016 the dinner daypart only declined by 1 per cent which was an improvement from 3 per cent during the first quarter of 2016. With market leaders like Tim hortons leading the way with focused marketing and menu innovations, this daypart seems to be rallying a comeback, slow in nature, but a comeback non the less.
“The good news in all of this is that consumers made 61.3 billion restaurant visits this past year,” says Bonnie Riggs, NPD Group’s restaurant industry analyst. “They are not giving up dining out at restaurants and other foodservice outlets. It’s true that in this flat market it’s a battle for visit share but there are restaurants that are winning. The winning operators focus on their customers’ needs and deliver on them,” she continued to say.
Until next time your customers want to know why they should spend money at your restaurant, bar or cafe. So give them the goods!
Dwayne Reno CEO & Founder
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