CNBC: Restaurants Change Menus for More Appeal

A number of restaurant chains have changed their menu items amid soaring food costs and consumers grappling with inflation, CNBC reported in a feature piece Friday.

"I think the common thread behind everything right now is that the chains that are winning aren't standing still. They're doing something innovative, whether that's new menu items … maybe that's a marketing innovation … maybe it's just hyper-emphasizing value," head of analytical research for Placer.ai, RJ Hottovy, stated.

According to a review of the restaurant industry by Black Box Intelligence, from January to February, year-over-year sales slumped but picked up in March. During the summer, traffic again began to stagnate but picked up in the winter.

This year, 26 bar and restaurant chains filed for Chapter 11 bankruptcy. The CNBC report outlines that the common denominator among restaurants who've been able to ride the rocky seas of the economy are those who offer "value."

"For the low-income consumer, it's the dollar amount that matters. For everybody else, it's value. Even if you have money, you're noticing things are more expensive, and you're going to be more selective," Moody's Ratings vice president of corporate finance, Michael Zuccaro, said.

While CNBC touted "value" as its word of the year, the publication pointed out that value is more than just offering customers a cheap meal. Fast food chains were this year's "loser" in the restaurant industry, CNBC wrote.

Traffic at fast food restaurants fell nearly 2% this year through October. Notably, fast food makes up roughly two-thirds of the restaurant industry.

"There's a lot more competition with grocery and other food retailers," Hottovy stated. "That's where most of the competition is, particularly for that lower- to middle-income consumer."

Among the restaurant chains that were able to keep a level heading were the brands that tout chicken as their protein of choice. Chick-fil-A, Raising Cane's and Wingstop, performed the best among fast-food chains in 2024. Another notable winner, chicken aside, was Taco Bell.

Yum Brands, which owns the Mexican spinoff, attributed its success to its customer's perception of Taco Bell's bang for the buck.

Another winner this year was "fast casual" chains such as Chipotle and Cava, whose stock skyrocketed 192% this year.

"You spend more money by going out rather than staying in, and fast casual seems to strike the right balance of the value equation," David Portalatin, Circana senior vice president and industry adviser for food and food service, said.