In case you haven’t noticed, several major fast-food restaurant chains have undergone, or are undergoing, fancy transformations in the design of their retail environments- inside and out. McDonald’s, KFC, Wendy’s Arby’s, Chick-fil-A and others, are hardly recognizable these days. And, that’s a good thing.
Cheap, fast-food is no longer the lure that it once was. Today’s consumers not only want healthier, fresher food options, but they want an elevated dining experience - or, at least the impression of one. Fast-food restaurants, technically called Quick-Service Restaurants or QSRs, are meeting these demands to remain competitive with the rapidly growing fast-casual concept (think Chipotle and Panera). QSRs are refreshing, remodeling, or rebuilding their stores to incorporate a more upscale, sleek, modern dining experience that includes comfortable seating, flat-screen TVs and even fireplaces.
Blurred lines between fast-food and fast-casual
According to Technomic consulting firm, “the fast food evolution is a result of the shift in market share between limited-service and full-service segments over the last decade.” Limited-service restaurants (LSRs), which include QSR and fast-casual concepts, now control 53% of the market. In order to compete, quick-serves must upscale their menus and the store environment to win share over the fast-casual restaurants.
“The key to limited-service restaurant growth is differentiation,” Consumers are looking for fresh, better-quality ingredients, a contemporary décor and ambiance, and interactive service formats to offer something unique and enhance the customer experience”, according to Technomic. No wonder the lines are blurring between the two segments.
Retailers that are driving the evolution
Throughout the industry, store remodeling is the goal, simply because it costs less than building new. Typically, the bulk of the remodeling expense falls on the franchise owners. The costs can be several hundred thousand dollars. According to Bloomberg, the average McDonald’s remodel is about $600,000. Is it worth it? Wendy’s, who began rolling out their new store designs in 2013, says their sales at company-operated, remodeled or new-style restaurants "have increased on average of more than 25%." Other brands have indicated between 15% and 30% increases.
WENDY'S continues to roll out its "Image Activation" remodeling plan across North America. Their successful redesign initiative focuses on improving the customer experience and giving the exterior a more contemporary look. The interiors feature multiple seating options, lounge chairs surrounding a fireplace, flat-screen TVs and of course, WiFi.
ARBY'S restaurant remodeling program kicked off in 2014, which was their 50th Anniversary, with a goal to open 60 new restaurant locations and complete over 160 remodels in 2015. The remodeled restaurants have already shown sales increases of nearly 20%, according to their COO, George Condos. The new design, which is named "Inspire", supports their brand positioning campaign called "deli-inspired deliciousness."
CHICK-FIL-A began their renovations in 2010 with the thought behind their new design being: “The tastes and expectations of fast-food customers continue to evolve, but one thing never really changes—they want food they feel good about, served by people who care, and they want it fast,” says Dwain Cox, director of innovation and design in a Design:Retail article focused on this trend. The store pictured here is in Pasadena, California, where the retailer incorporated local touches in the design to meet the needs of the community.
McDONALD'S set out in 2013 with a goal to remodel 1,600 locations and have continued non-stop since. The new interiors are bright and contemporary, and feature multiple seating styles. The color scheme consists of blues, greens and yellows at some locations. Changes to improve customer service were also made to the ordering and pick up area and the drive-thru areas.
Peter Rivera-Pierola, manager of strategic concepts for U.S. restaurant design, said that McDonald’s is constantly striving to modernize its retail environments and implement innovations that exceed customer expectations. “A great example is the ‘Create Your Taste’ custom burger and kiosk ordering experience that we’re testing in select restaurants in the United States... and other markets,” he stated.
KFC is among one of the more recent restaurants to undergo a modern make-over. They have implemented a “multi-year revitalization strategy to refresh 70% of the brand’s 4,500 retail stores by the end of 2017,” according to a recent article in QSR Magazine. The prototype store design, launched in 2014, has seen sales increase by 3%, indicating that the new design is gaining traction.
KFC’s new interior has features designed to create an environment where guests will want to relax and spend some time. Pictured here is the family-style seating area called the ‘Colonel’s table’. On trend with many of the other QSRs, a photo wall showcases the history of the brand and the Colonel’s legacy.
The new QSR design trends cater to the higher expectations of today’s consumer: quality product, value, innovation and an elevated dining experience. Even if the food isn’t really all that much different, the perception of the brand experience is important. Nobody wants to dine in a dingy old restaurant that gives off the impression of serving sub-par food. Not when there are too many other “fancy fast food” choices.
Other Related Resources You May be Interested In:
- KDM BLOG: New Trends in Fast Casual Retail Environments
- VIDEO TESTIMONIAL: View growing fast-casual retailer, Tom+Chee testimonial regarding KDM's execution of their retail environments
KDM POP Solutions Group’s dedicated retail solutions division, KDM Retail, works with retailers to create compelling retail environments that address your consumer. In tune with the latest in retail design trends, we provide creative design services, store planning, decor, custom store fixtures, merchandising displays, signage and graphics. Whether you need a new store environment, a remodel or refresh, KDM Retail can manage and execute your entire project. To learn more, CONTACT US today.