Food Industry

ANALYSIS OF FAST FOOD INDUSTRY

Siddharth J. Muthukali

NYU Polytechnic School of Engineering

MG9703: Project in Strategy and Innovation

INTRODUCTION

The lure of fast food is more prominent now than it was ever before, especially in the United States. Quick service restaurants or fast food restaurants as they are more commonly known as, have the highest market share in terms of types of restaurants visited. Fast food restaurants were started to give fast service to customers at affordable prices. The principle of the industry has remained the same over the past decades but the magnitude of the service provided has increased immensely. These days, fast food joints are not opening in single store but creating a retail chain, which is then turned into a brand. The fast food sector is now the fastest growing in the restaurants industry. This paper is going to look at how the fast food industry has applied various strategies and innovations and how certain recommendations will help them improve their sales and remain competitive in this industry.

INDUSTRY ANALYSIS

McDonald’s has always dominated the U.S. Fast Food industry. It has the highest brand value as well as market share in the fast food sector. As all industries, the fast food industry was also affected by the recession in 2009 and hence lost quite a bit of their market share. But unlike the other industries, it bounced back immediately and regained the lost market share, as seen in the figure below.

Fig 1 – Market Share of Fast Food Chains between 2005-2010

The top five fast food restaurant chains in the U.S. –

1) McDonald’s

2) Starbucks

3) Subway

4) KFC

5) Pizza Hut

These 5 fast food chains are top in terms of their brand value. They are not only top in terms of brand value but also in terms of the sales. This can be seen in the graph shown below.

Fig 2 – Brand Value of Top 10 Fast Food Brands in the US in 2014 (Statista)

These 5 fast food chains are not only top in the...