Fast Casual Restaurant Market Expected to Reach $337.8 Billion by 2032—Allied Market Research

According to a new report published by Allied Market Research, titled, “Fast Casual Restaurant Market," The fast casual restaurant market was valued at $124.50 billion in 2022, and is estimated to reach $337.8 billion by 2032, growing at a CAGR of 10.4% from 2023 to 2032.

The global fast casual restaurant market was valued at $124.5 billion in 2022, and is projected to reach $337.8 billion by 2032, registering a CAGR of 10.4% from 2023 to 2032.

Fast casual restaurant offer a self-service model, often with limited table service, and place a strong emphasis on in-house dining ambiance, which features upscale decor based on various themes. Quality is a key focus, with customers expecting higher-grade ingredients at a price point between fast food and full-service dining. Customization is central to the fast-casual experience, which allow customers to customize their meals from a range of different ingredients. Some fast casual restaurants such as Chipotle and Shake Shack even include alcoholic beverage offerings. 

In addition, there are numerous fast casual restaurant chains which include Panera Bread, Sweetgreen, MOD Pizza, and Chopt Creative Salad Company. These establishments cater to a range of customer who seek the combination of convenience, quality, and customization offered by fast casual dining, making it a prominent and rapidly growing segment of the restaurant market.

The advent of cloud kitchens has brought a rapid shift in the restaurant industry by significantly reducing capital expenditure requirements, which has thereby facilitated the establishment of fast casual restaurant market growth with greater ease. This lower financial burden, coupled with the prospect of higher profit margins, has fueled significant investments in the fast-casual restaurant segment. Fast-casual restaurants typically demand lower initial capital in the beginning that effectively lowers the financial barrier to entry for entrepreneurs and investors who seeks to enter the market. Fast-casual chains are characterized by their strategic adoption of technology, which supports the businesses to streamline operations, enhance customer convenience, enable online ordering, delivery services, and engage with various customers through data-driven decision-making. This tech-driven approach contributes to increased operational efficiency and helps to provide improved overall business performance. Thus, there is a steady growth in fast casual restaurant market size in recent years, along with increased fast casual restaurant market share in different regions. 

Moreover, the increase in automation within fast-casual kitchen operations and the rise of food delivery companies that specializes in door-to-door service create plenty of opportunities for further growth and expansion of these kitchen concepts on a global scale. Furthermore, many fast-casual chains offer franchise opportunities that facilitates the replication of successful business models in diverse locations all around the world. This franchising approach accelerates the proliferation of fast-casual chains, which thus contributes to rapid expansion of fast casual restaurant market. Thus, the combination of low entry barriers, the potential for robust profits, technological advancements, automation, and franchising opportunities is poised to drive the swift growth of the market during the fast casual restaurant market forecast..

Fast casual restaurants face challenges during the fast casual restaurant market analysis owing to economic uncertainties, which includes the possibility of rising unemployment and inflationary pressures globally. Fast casual restaurants, known for their fresh and health-conscious menus, come with premium prices that exclude budget-conscious consumers from the target market. The differences in prices, in comparison to more budget-friendly quick-service restaurants such as Subway or McDonald's, curtail their customer base, which thus limit their ability to serve a broader audience in the global market.

The fast casual restaurant industry recognizes the imperative role of technology in operational optimization. Integration of scheduling software, digital inventory tracking, automated procurement, and digital reservation systems offers substantial enhancements in revenue generation, inventory control, and customer satisfaction. This trend presents lucrative opportunities for fast casual restaurant stakeholders to streamline critical processes and improve efficiency. Moreover, the adoption of robot-assisted cooking technology in prominent chains such as Chipotle, White Castle, and Wing Zone presents huge market growth owing to increased convenience, reduction in labor costs, and faster food preparation, which ultimately leads to quicker customer service. Thus, fast casual restaurant market opportunities are growing owing to the advancement, which has led to fast casual restaurant market trends to flourish in recent times.

The rapid spread of coronavirus has disrupted the smooth functioning of fast casual restaurant industry, owing to which the companies faced a downfall in the initial phase of the COVID-19 pandemic, but soon they managed to maintain their revenues after the restrictions were lifted and everything was back to normal in different regions. The outbreak started in China resulting in lockdown and ceasing of dine-in activities across the country. Moreover, recent developments in resurgence of second wave of COVID-19 in China was one of the major challenges the country faced owing to complete shutdown of all activities. Other countries in Asia were also facing the same predicament. Stringent rules across the Indian subcontinent disrupted the supply chain and interrupt the production activities. The duration of the virus outbreak remained a key factor in assessing the overall impact of the pandemic, however, lack of workers and disruption in supply chain were the major challenges for the engaged stakeholders all around the world.

The fast casual market is segmented into food type, mode of operation, nature, and region. On the basis of food type, the market is segregated into burger/sandwich, pizza/pasta, Asian/Latin American food, chicken, and others. As per mode of operation, it is divided into dine-in and takeaway. By nature, the market is bifurcated into franchised and standalone. Region wise, it is analyzed across North America (U.S., Canada, and Mexico), Europe (UK, Germany, France, Italy, Spain, and rest of Europe), Asia-Pacific (China, India, Japan, Asean, and rest of Asia-Pacific), and LAMEA (Latin America, Middle East, and Africa).

Key findings of the study 

• By food type, the burger/sandwich segment led in terms of the market share in 2022. Moreover, the pizza/pasta segment is anticipated to be the fastest-growing segment during the forecast period. 
• By mode of operation, the dine-in segment accounted for more than three-fifths of the market share in 2022. However, the takeaway segment is expected to gain traction during the forecast period.  
• By nature, the franchised segment accounted for more than four-fifths of the market share in 2022. However, the standalone segment is expected to be the fastest growing segment during the forecast period.
• By region, the North America region dominated the global market in terms of the market share in 2022.  However, the Asia-Pacific region is expected to be the fastest growing segment during the forecast period.

The key players in the global fast casual restaurant market have implemented a range of strategic initiatives, which includes geographical expansion, product launch, innovation, and acquisitions. These key developments have significantly increased the market share, driven profitability, and strengthened their competitive position within the market. The key players operating in the fast casual restaurant market include Chipotle Mexican Grill, Wingstop Restaurants, Inc., EXKI SA, Panda Restaurant group, Inc., Five Guys Enterprises, LLC., Famous Brands Limited, Restaurant Brands International Inc., Zaxby’s Franchising LLC., Erbert & Gerbert’s Sandwich Shop, and Tortilla Mexican Grill PLC.