What is in this article?:
- Sizing up restaurant market-share competition in 2014
- Casual dining: Supply outweighs demand
- Limited service: Opportunity beyond McDonald's
- Snack and specialty: Brewing the best opportunities
Securities analyst Andy Barish of Jefferies Equity Research predicts which chains might gain and lose share this year.
Securities analyst Andy Barish of Jefferies Equity Research predicted an oversupply of restaurant locations continuing in 2014, but he also noted that there would be ample opportunities for innovative brands to take market share in the new year.
While Barish noted that the fast-casual segment will continue to be the disruptive force it has been for years to both quick service and casual dining, he identified an opening to steal market share for brands across all three segments.
Conditions are favorable for opportunistic brands in categories awash with independent concepts, such as pizza, coffee and tea, doughnuts, and bakery sandwiches, Barish wrote in one of several research notes published in mid-December.
“In these fragmented categories, we think some of the larger chains can leverage their scale, technology investments and brand awareness to take share from smaller mom-and-pops,” he wrote, indicating Dunkin’ Donuts, Starbucks and Papa John’s. “At the same time, we see opportunities for smaller, more dynamic and nimble chains in mature categories to take share from the dominant leading chains that have let operations slip, underinvested or failed to innovate and evolve the menu.”
He noted that Popeyes Louisana Kitchen parent AFC Enterprises could continue to take share in the chicken category this way, as could Jack in the Box and Sonic in the hamburger category.
Barish also offered the following insights on several restaurant categories. His comments were limited to the restaurant companies in Jefferies’ coverage territory, which did not include some large players such as Brinker International, Burger King, Domino’s Pizza or Wendy’s.