Restaurant Development & Design

WINTER 2014

restaurant development + design is a user-driven resource for restaurant professionals charged with building new locations and remodeling existing units.

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4 • R E S T A U R A N T D E V E L O P M E N T + D E S I G N • W I N T E R 2 0 1 4 Editor's Letter Assessing a Moderate Growth Environment T he restaurant industry appears poised to enjoy its ffth consec- utive year of growth, according to the National Restaurant As- sociation's 2014 Restaurant Industry Forecast. According to NRA projec- tions, restaurant industry sales will top $683 billion in 2014, an increase at an adjusted rate of 3.6 percent from the $659.3 billion in sales for 2013. In real terms, the industry will grow 1.7 percent. The NRA projects sales for res- taurants that provide table service will increase 2.6 percent to $212 billion. In real terms, this represents a 0.2 per- cent increase. Sales at limited service restaurants will increase 4.4 percent on an adjusted basis to $195 billion, ac- cording to the NRA. This translates into a real growth rate of 2 percent. And the NRA projects the number of restaurants will grow to 990,000 in 2014, an increase of 1 percent. That's the good news. The bad news is the fact that industry growth rates remain muted compared to historic levels or even the years leading up to the recession. For example, the restaurant industry's compound ag- gregate growth (CAG) rate for the past 3 years is 3.8 percent, according to the National Restaurant Association. The industry's CAG was 4.2 percent for the past 10 years and it swells to 6.5 percent for the past 44 years, according to the NRA. So what does this mean for the restaurant development community? For starters, it means that restaurant con- cepts will need to continue to develop new prototypes and refne existing ones to make sure their layouts provide the best possible experiences for custom- ers and employees alike, as consultant Juan Martinez points out on page 22. Operators will also need to make sure their concepts remain relevant to today's consumer and appealing across a variety of price points. Take, for example, Del Frisco's Restaurant Group. While best known for its high-end steak concepts, the multi-concept operator sees its new Del Frisco's Grille, a more casual restaurant chain, as a key growth vehicle, as Bill Martens, the company's vice president, development and con- struction, discusses on page 18. In contrast, mature concepts like Bonanza and Ponderosa (page 48) are undergoing a refresh to make sure they remain relevant in the eyes of Millenni- als and members of Generation X, who don't have a connection to the Western- oriented television show that inspired these casual dining concepts. Prototype units for both concepts are in the midst of a refresh that leverages signage to better showcase its depth and breadth of menu and new imagery that reinforc- es the notion of using fresh ingredients in meal prep. It also means it's time for the restaurant development community to come together to share best practices, seek solutions to challenges and more. That's exactly what will happen March 16-19 during RestaurantPoint, one of the development community's key gath- ering places. I hope to see you there. JOSEPH M. CARBONARA, Editor-in-Chief

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