Drive-throughs Drive Up Profits For Fast Casual

Sorry Ronald McDonald, but the drive-through isn't just for feeding Big Mac attacks anymore.

The fast-food drive-through is spilling into the world of designer coffee, convenience stores and fast-casual chains such as Panera Bread.

Thanks, in part, to these new avenues, drive-through sales, which slowed during the recession, are growing. Sales were up 3% in 2011, and up 2% in 2010, after falling 1% in recession-fed 2009, according to a report from researcher NPD Group, to be released Tuesday. Last year, some 12.4 billion consumers visited fast-food drive-throughs, a 2% traffic increase over the prior year, NPD says.

"For the consumer, it's all about time and convenience," says Bonnie Riggs, NPD's restaurant industry analyst. "But for the restaurant, it's also about the bottom line." Which explains why drive-throughs are stretching into new territories:

•Fast-casual. At Panera Bread, one of the nation's most successful fast-casual chains, the drive-through is evolving into a serious moneymaker. Seven years after testing its first drive-through, Panera is now building them into 20% to 30% of its new locations, says founder Ron Shaich. Roughly half of Panera's drive-through sales are incremental, he estimates. For folks with kids in the car, it's not always convenient to walk into a Panera, Shaich says. "Drive-throughs aren't bad. What's bad is doing them poorly in a mechanized way with processed food. I'm all for giving people access to Panera's good food — not limiting it."

By the end of 2012, Panera will have roughly 200 drive-throughs, he says, offering every item on the Panera menu — even paninis. Read More

Posted on May 22, 2012 and filed under Fast Casual.