Typically, Technomic’s ConcepTrac newsletter highlights four concepts featuring a shared characteristic—such as a similar service format or cuisine. The August issue however focuses on a similarity that exists outside restaurant walls. All four of Technomic’s featured concepts—Chicken Salad Chick, Honeygrow, MAKE OUT and Naf Naf Grill—are recent recipients of investments from private equity firms. It’s no coincidence that these brands are in the fast-casual sector, which continues to remain the industry’s top-growing segment and center of innovation. While Technomic’s featured concepts are all categorized under different cuisines, they do share the following characteristics that have made them attractive to investors:
- Distinctive Menu—as the fast-casual industry gets more crowded, investors are looking to brands with unique specialties such as Chicken Salad Chick’s menu of chicken salads; Honeygrow’s healthy stir-fries and snacks; MAKE OUT’s vegan takeaway fare; and Naf Naf’s Middle Eastern offerings
- Freshness—all four of these featured brands emphasize freshness with features such as open kitchens, made-to-order meals and local ingredients
- Efficiency—from iPad ordering kiosks to packaged grab-and-go items, these concepts know efficiency is key to increasing sales and drawing in more customers
From my perspective, as the fast-casual industry continues to grow, fast-casual eateries will remain a focus for private equity firms and other investors. Brands looking to partner with an investor should exercise caution in making sure to choose a partner that aligns with their values, and not a firm that just wants to capitalize on the lucrative fast-casual segment.
Note: This content originally appeared in the August 2015 issue of Technomic’s ConcepTrac newsletter.