You can learn a lot about an industry from its trade journals. I particularly enjoy reading QSR, dedicated to the "quick serve" restaurant industry, also known as the fast-food business. QSR alerts me to new eatery chains and new trends among existing chains, and offers data on how various chains are doing -- including some recent and surprising statistics on the importance of drive-through windows.
According to QSR surveys:
- 48% of consumers base their decision on where to eat at least partly on the availability of a drive-through option.
- 39% of consumers use a drive-through at least once a week. (A spokesperson at Dairy Queen said that 70% of its customers use the drive-through to some degree.)
- While half of respondents prefer to eat in the restaurants, another half say they rarely go into a restaurant to order food to take out.
What do consumers want when they use a drive-through? Good food, of course, but beyond that, they seek order accuracy (86%), easy-to-read menu boards (79%), good customer service (77%), fast service (74%), and a short line (71%), among other things. (What was low on the list? Credit/debit card acceptance (28%), for one thing.)
Quick-serve restaurants have heard consumers' cries, and more than 80% of them have initiatives under way to improve their customers' drive-through experience. With any luck, if you're a drive-through enthusiast, you'll encounter fewer muffled sound systems at drive-throughs in the years ahead. Some two-thirds of companies have recently redesigned drive-through menu boards, and 26% have changed food or drink packaging to make it better for drive-through customers. At 7-Eleven, the chain has started putting wraps in cups.
One company that apparently needs to work on its drive-throughs is McDonald's
Did you know?
The surveys reveal other interesting facts about drive-throughs:
- When people buy food at a drive-through, 34% of them ultimately eat the food at home, while nearly half (47%) eat it in their car. This has implications for other businesses, including the auto industry. Scoff if you want at the prominence of cupholders in cars, but they are important. Consumers want them wide enough and deep enough to hold a variety of cans and cups. They need places to keep other food offerings, as well, besides their laps. An Autobytel survey showed that one-fifth of consumers would pay an extra $80 for a perfect cupholder in their car. Some 64% of drivers in 2004 reported using their cupholders every day, up from just 46% in 2002. In demonstrating the growing primacy of cupholders, QSR reported that "the Honda
(NYSE:HMC)Odyssey minivan seats seven, but has 17 cupholders."
- Lunch is by far the main drive-through time, comprising 58% of the most frequently ordered meals, followed by dinner at 27%, and breakfast at 9%. To boost their breakfast traffic, McDonald's and Burger King
(NYSE:BKC)have been beefing up their morning offerings with new coffees, as they compete with coffee specialists such as Dunkin' Donuts. There seems to be ample room for improvement in luring more customers to the drive-through for breakfast; perhaps restaurants need to focus on easily portable, commuter-friendly food, like breakfast burritos, instead of fork-and-knife fare like pancakes.
- Along similar lines, burgers (41%) are the food item most often purchased at drive-through windows, followed by chicken (19%) and sandwiches (14%). Pizza (3%) and seafood (2%) were relative rarities. If a restaurant chain offered lobster-on-a-stick or pizza wraps, it might do well.
- The five most accurate chains don't include big names such as McDonald's or Burger King. Instead, they're Chick-fil-A, Whataburger, Jack in the Box
(NYSE:JBX), Carl's Jr., and Taco John's. The big names appear instead on the list of the fastest. Here are the top five: Checkers, Wendy's (NYSE:WEN), Yum! Brands (NYSE:YUM)division Taco Bell, McDonald's, and Burger King.
Please pull up to the next window .
The trade journals of your favorite industries can provide plenty of Foolish food for thought for interested investors.
If you'd rather tap the expertise and investing opinions of people who read trade journals for you, take a free trial of one or more of our investing newsletters. Our Motley Fool Hidden Gems newsletter, for example, has recommended one food chain several times, and that stock has advanced some 13%, 37%,and 55%, respectively, since each recommendation. We've also recommended a company that sells commercial ovens to food chains and restaurants. With a free trial, our full archives will give you in-depth information on each recommendation. Overall, Hidden Gems picks have more than doubled the S&P 500's returns since inception, at 31% to 17%.
Longtime Fool contributor Selena Maranjian 's favorite discussion boards include Book Club, Eclectic Library, Television Banter, and Card & Board Games. She owns shares of Yum! Brands and McDonald's. For more about Selena, view her bio and her profile. You might also be interested in these books she has written or co-written: The Motley Fool Money Guide and The Motley Fool Investment Guide for Teens . The Motley Fool is Fools writing for Fools.