Quick serve chain Chick-fil-A achieved a coup in 2012 that would have been considered impossible only a few years ago, overtaking KFC as America's biggest chicken restaurant by revenues. It has retained that position and steadily widened its lead, with systemwide sales topping $10bn for the first time in 2018, having risen by more than $1bn a year for the previous five years. As a result it overtook Subway during 2018 as the #3 chain in the US behind McDonald's and Starbucks. All this despite the fact that it has only around half the number of outlets KFC has, a chicken-only menu and that unlike virtually any of its rivals it is closed nationwide on Sundays because of the devout Christian beliefs of its founding family. However, such is its popularity with customers that each outlet grosses more per year than either KFC or any other fast-feeder including McDonald's and Burger King. Average annual sales per store were $4.3m in 2018, around four times KFC, making Chick-Fil-A one of the three most lucrative limited service restaurant chains in the US, and higher even than casual dining giants like Red Lobster or the Outback Steakhouse. It is also the clear leader in terms of customer satisfaction, with an 86% rating on the American Customer Satisfaction Index. No other limited service restaurant achieves even 78%. Founder Truett Cathy opened the first Chick-fil-A in Atlanta, Georgia in 1963, arguably inventing the chicken burger concept, later widely copied by other fast-food chains including McDonald's. There are now 2,370 outlets across the US, including several hundred high-traffic sites located in shopping malls and catering to a family market. All outlets are franchised. The chain is a major sponsor of college football nationally, but especially in its heartland of the South where it has sponsored the Peach Bowl playoff for more than 20 years. The Chick-fil-A brand is partnered by a small chain of Truett's Grill 50s-style diners. The business is still family-owned and run. Corporate revenues were over $3bn in 2018 with net earnings of $435m. At the age of 92, Truett Cathy passed over the role of CEO to his son Dan Cathy in 2013, and passed away the following year. Several other family members work in the company.
Capsule checked 9th May 2019
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Recent stories from Adbrands Weekly Update:
Adbrands Daily Update 9th May 2019: The extraordinary growth of Chick-Fil-A continues. The chain is overtook Subway during 2018 to become the 3rd largest limited service restaurant business in the US behind McDonald's and Starbucks. In 2018, Chick-Fil-A posted its fifth consecutive annual increase of over $1bn in systemwide sales, reaching $10.5bn, according to market watcher NRN. This despite a footprint of just 2,370 stores: around a tenth of Subway's estate and only a little over half main rival KFC.
Adbrands Weekly Update 28th Jul 2016: Fast food chain Chick-Fil-A - now America's top chicken restaurant ahead of KFC - called time on a 22-year relationship with creative agency The Richards Group. Instead it has appointed McCann New York as its new lead agency, with project-based support from start-up boutique Erich & Kallman, run by Steve Erich (ex-CP&B) and Eric Kallman (ex-Goodby Silverstein).
Adbrands Weekly Update 7th April 2016: Restaurant trade bible NRN published its annual Consumer Picks rankings of the top US foodservice chains according to customers. The results are always interesting, proof (as if it were needed) that bigger rarely means better. The winner in the limited service (savoury) category was In-And-Out Burger, narrowly ahead of Chick-Fil-A, while Ben & Jerry's took first place in limited service (sweet), above Haagen-Dazs. But what about the major chains, you ask? Well, out of a total of 112 limited service chains evaluated, McDonald's came in at #110, beating only A&W and Chuck E Cheese's. Burger King and Taco Bell were also in the bottom ten. KFC managed a lowly #89, but came last out of all 11 chicken chains. Top prize in casual dining went to the Cheesecake Factory, although major chains Bonefish Grill, Red Lobster, Romano's, Carrabba's and Olive Garden all put in a respectable showing, taking five consecutive places from #3 to #7. Buffalo Wild Wings was bottom out of 40 chains. Cracker Barrel took top place among family dining restaurants, while Morton's The Steakhouse was the #1 fine dining destination. The rankings were calculated from more than 4,800 consumer questionnaires, which asked customers to rank all chains according to a variety of criteria including service, cleanliness, food quality, atmosphere and value.
Adbrands Weekly Update 23rd Apr 2015: US foodservice trade title NRN published its annual Consumer Picks report, listing the country's most popular restaurant chains according to 44,000 customer surveys. Among the winners were Ruth's Chris Steak House, the #1 overall by votes, as well as in the fine dining category; The Melting Pot, top choice in the casual dining category; and In-N-Out Burger which headed the limited service category. Some of the bigger chains also did well, including Chick-Fil-A, just inside the overall Top 20; and Olive Garden, still among the Top 25. Bloomin Brands' Carrabba's Italian Grill and Bonefish Grill were both among the top 5 in casual dining, and ice cream cafes Bruster's, Ben & Jerry's and Haagen-Dazs rounded out the Top Four in limited service. So what of sector giants like McDonald's, Burger King and KFC? Once again, McDonald's and Burger King languished at the bottom of the table; out of 172 restaurants only Chuck E Cheese got a lower score. Taco Bell, KFC and Dunkin' Donuts were all also outside the Top 100.
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