Restaurants
Industry Profile Report
Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters
Industry Overview Current Conditions, Industry Structure, How Firms Operate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.
Call Preparation Call Prep Questions, Industry Terms, and Weblinks.
Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.
Industry Profile Excerpts
Industry Overview
The 436,000 restaurant companies in the US include full-service restaurants, quick-service restaurants (fast food, snack and non-alcoholic beverage bars), fast-casual restaurants, grills, buffets, and cafeterias. Franchise restaurants are individually owned and operated and benefit from marketing and operational assistance provided by a franchisor.
Competition For The Food Dollar
While the restaurant industry is highly competitive, eating establishments also compete with convenience stores, grocery stores, warehouse clubs, and home cooking.
Emphasizing Health and Sustainability
Increasing consumer concern for health and the environment has led to growing demand for healthier and more sustainable restaurant menu options.
Industry size & Structure
A typical restaurant operates out of a single location, employs about 22 workers, and generates $1-2 million annually.
- The restaurant industry consists of about 436,800 companies which employ 9.7 million workers and generate almost $800 billion annually.
- The industry includes full-service restaurants, quick-service restaurants (fast food, snack and non-alcoholic beverage bars), fast-casual restaurants, grills, buffets, and cafeterias. Food service contractors, bars that serve mainly alcoholic beverages, mobile food services, and caterers are not included.
- Franchise restaurants are individually owned and operated and benefit from a recognizable brand name, corporate marketing, volume purchasing, and operational assistance provided by a franchisor.
- Restaurants may specialize by type of fare (Mexican, Chinese), dish (hamburgers, sushi), item (cookies, ice cream), or meal (breakfast, lunch, dinner).
- Large restaurant companies include McDonald's, Subway, Burger King, Wendy's, Golden Corral, Ruby Tuesday, DineEquity (Applebees) and Starbucks.
Industry Forecast
Restaurants Industry Growth
Recent Developments
Mar 14, 2025 - Prioritizing On-Premise Traffic
- Driving on-premise traffic will be a higher priority for restaurant operators than capturing off-premise visits this year, according to the National Restaurant Association’s State of the Industry Report 2025. During the pandemic and its aftermath, restaurants – by necessity – focused on their take-out and delivery services. Now, according to the report, 81% of consumers say they would eat at full-service restaurants more frequently if they had more money to spend. Across segments, restaurants are prioritizing on-premise service with 60% of quick-service restaurant (QSR) operators saying on-premise visits would be more important in 2025 than off-premise, while 90% of fine dining operators said the same. Major brands – notably Starbucks and Subway – are focusing their efforts on improving the dine-in experience and make their eateries more appealing places to linger. QSR customers identified store cleanliness as one of the most important factors determining their visit, per the NRA survey.
- To combat high turnover among tipped servers, full-service restaurant operators may want to consider adding earned wage access to their menu of employee benefits, new research commissioned by DailyPay and conducted by The Harris Poll shows. High employee turnover is a major industry pain point. Across the restaurant industry, the average employee tenure is just 110 days, a turnover rate of 41% for front-of-house workers. Earned wage access (EWA) allows employees to draw a portion of their earned wages before their scheduled payday. According to the data, nearly two-thirds (63%) of millennial tipped hourly service industry workers say their overall quality of life and mental health would improve if they had access to their hourly pay when they earned it. Access to EWA even outperformed not being taxed on their tips (60%), having flexible work schedules (60%), or interest rates dropping (36%), according to the poll.
- The restaurant industry is expected to reach $1.5 trillion in sales and add more than 200,000 net new jobs in 2025, bringing total restaurant and foodservice employment to 15.9 million by year-end, according to the National Restaurant Association’s 2025 State of the Restaurant Industry Report. While the challenges facing restaurants in 2024 – including rising labor and food costs and the ongoing struggle to recruit and retain employees – remain, more than 8 in 10 operators expect their 2025 sales to be either higher or about the same as 2024, per the report. Consumers told NRA they’d eat out more frequently if they had the money, a sentiment that cuts across all segments: on-premises dining at table-service restaurants (81%) to visiting quick-service restaurants, snack places, delis or coffee shops (76%) to home delivery (82%). Fine and casual dining establishments are focusing on attracting more in-person diners in 2025.
- Rising eggs prices are a challenge for restaurants, especially breakfast-focused formats where eggs are a cornerstone ingredient, Fastcasual.com reports. Bird flu outbreaks have caused the cost of eggs to surge by 30% over the past year. The average cost of a dozen Grade A large eggs was $3.65 in November 2024, up 28 cents from October, according to the Bureau of Labor Statistics. By comparison, in 2023 the cost averaged $2.07 per carton. Rising and volatile egg prices impact everything from food costs to menu pricing strategies for full-service and quick-service restaurants. Strategies for managing volatility and protecting the bottom line include reducing waste and managing costs using inventory management software such as Restaurant365. Other cost-control measures include preventing over-portioning, adjusting menus to include less egg-centric dishes, and negotiating with vendors to reduce other food costs to compensate for higher egg prices, according to Fastcasual.com.
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