Restaurants Industry Overview

  • SIC Code5812
  • NAICS Code722511

Industry Excerpt

Companies in this industry operate restaurants and other eating places, including full-service restaurants (FSRs), quick-service restaurants (QSRs), cafeterias and buffets, and snack bars. Major companies include Bloomin' Brands, Darden Restaurants, McDonald’s, Starbucks, and YUM! Brands (all based in the US), as well as Greggs (the UK), Jollibee Foods (the Philippines), Skylark (Japan), and Restaurant Brands International (Canada).

Competitive Landscape

Demographics, consumer tastes, and personal income drive demand. The profitability of individual companies can vary: while QSRs rely on efficient operations and high volume sales, FSRs rely on high-margin items and effective marketing. Large companies have advantages in purchasing, finance, and marketing. Small companies can compete by offering superior food or service. The US industry is highly fragmented: the 50 largest companies account for about 15% of revenue.

Products, Ops & Technology

Products include appetizers, entrées/main dishes, desserts, and beverages. Companies may specialize in certain types of cuisines, entrées, or specialty food items. Among full-service restaurants, most establishments focus on ethnic cuisines, led by Asian food (20%), American food (10%), and European food (10%), according to Mazzone & Associates. Hamburger restaurants account for more than one-third of sales among US limited-service establishments, while pizza parlors account for about 15% and sandwich shops make up about 10%, according to Technomic. Bakery-cafés and Mexican food are the largest categories in the fast-casual segment. Industry revenue is roughly split equally between FSRs and limited service.
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