In and Out

Class: Understanding Customers and Market through Research Assign1: Secondary Research Project: In and Out Burger Prepared by: Hyekyung, Yeo (Kay) Objective To find out the direction In and Out burger should be taking to have more market shares in the future Fast Food Industry Fast food restaurants represent one of the largest segments of the food industry with over 200,000 restaurants and $120B in sales in the U.S. alone[1]). Fast food restaurants, also known as quick service restaurants (QSRs), are noted for their short food preparation time. Some of the largest players in this category include international giants like McDonald's) and Yum! Brands), national chains such as Wendy's) and Burger King) and regional players like Jack In The Box), In and Out and Sonic). Since late 2006, the fast food industry's growth has been slowed by soaring food and energy prices. The high prices of commodities, combined with the housing slump and a weakening job market are taking a toll on restaurant spending in the U.S. (the world's largest fast food market, by far). The same food and energy inflation that is corroding consumer spending is also taking a bite out of company margins. Fast food restaurants have navigated this difficult landscape with varying levels of success. International players such as McDonald's (MCD)) and Yum! Brands (YUM)) have had the most success as explosive growth in emerging markets has offset rising costs and a U.S. slowdown. Other companies like Sonic) and Domino's) have turned to new marketing campaigns and product innovation to boost growth and profitability. Rising Food Prices Pressure Fast Food Margins Several factors have contributed to a dramatic rise in food prices in recent years, including higher oil and energy prices; the growing global demand from rapidly developing economies such as China and India; a weak U.S. dollar; and a larger share of the grain market being diverted to ethanol production. These trends have led to the rapidly...