A Roundup of Noteworthy Foodservice Findings for the Week of April 19, 2021

Industry Insights A roundup of noteworthy foodservice findings for the week of April 19, 2021 Discover major shifts in the Top 500 chain rankings We are excited to announce that the highly anticipated 2021 Top 500 Chain Restaurant Report has been released!

Location count falls TOP 500 CHAINS: U.S. LOCATION COUNT YEAR-OVER-YEAR CHANGE (%)

by 2% for the Top 500 2.0%

Chains 1.2% 0.8% After years of sustained expansion, the Despite the overall location decline Top 500 largest chain restaurants across the Top 500, several key players experienced a cumulative U.S. location still managed to grow their footprint in 0.3% decline of 2% in 2020, resulting in a net 2020, including top chains like loss of just under 4,500 locations. Chick-fil-A, Domino’s and Jersey Mike’s Subs. The Top 500 chain group ended 2020 with an overall U.S. location count of 225,558, declining from the prior year’s count of 230,051. From a segment perspective, location closures were notably higher among full-service chains, falling by 4.1% as compared to a 1.7% decline for limited -2.0% service. 2016 2017 2018 2019 2020

Sources: Technomic Ignite company data

Mole is quintessential Mexican fare. based cocktail at The Diver in Chicago Used as both a marinade and a sauce to a coffee and Irish whiskey drink at (and the name for a dish), mole typically WoodWind in Chicago. contains fruit, chile pepper, nut and La Llorona Cantina Mexicana in spices. Moles are known for their Philadelphia featured aged mole on complex nature, rich flavor and general chicken wings, one of the more popularity. popular dishes amid the pandemic. At the end of 2020, Technomic And mole vinaigrette is in a Belgian predicted a resurgence of Mexican fare endive and lacinato kale salad at Clarity in new iterations in 2021. We’re already in Vienna, Va., and a tuna poke bowl at seeing this trend with many innovative Foxcroft Wine Co. in Charlotte, N.C. mole variations. Clearly, operators are taking mole and Here are a few examples: repurposing it in other—often non- With dominant notes of chocolate, Mexican—dishes. It will be interesting cinnamon and spices, mole bitters to see how this plays out beyond have popped up in everything from an independent restaurants or with other Old-Fashioned at Better Half Coffee & treasured global ingredients.

Cocktails in Austin, Texas, to a mezcal- Image Source: Shutterstock

Source: Technomic Ignite Menu featuring the Technomic Emerging Eats report

© 2021 Technomic, Inc. 4 IGNITE CONSUMER TOP-TWO BOX RATINGS AGREE/STRONGLY AGREE Consumers 68% 68% 67% 67% 67% 67% 66% Re-evaluate Value 65% 61% 61% 61% 60% 60% 60% 59% 57% A significant evolution of the overall many restaurant operators during the consumer value mindset continued in great recession—consumers are pulling the first quarter of 2021. away from this dollar-driven thinking. 50% 50% 50% The ongoing tracking of consumer Consumers are interested in value, to 49% 49% 49% 48% attitudes and behaviors captured within be sure. However, the value proposition Ignite Consumer includes three core inherent in a wallet-first approach 46% value-based attitudinal statements. The misses the opportunity to maximize percentage of consumers who agreed check size, margins and loyalty with with these statements started to decline premium offerings and more substantial in the second quarter of last year, just bundling options. as the COVID-19 pandemic began Q2 '19 Q3 '19 Q4 '19 Q1 '20 Q2 '20 Q3 '20 Q4 '20 Q1 '21 forcing changes that upended our daily lives. However, rather than focusing on price- I pay close attention to menu prices so I can find the best value for my money based decisions—resulting in a “dollar menu” strategy used extensively by I always compare prices before deciding what to buy

I usually pick restaurants with lower prices Base: 27,300 consumers ages 18+ per period Source: Technomic Ignite consumer data

Pizza is popular—now, in the pandemic Leaders include well-known brands era, perhaps more so than ever. It’s such as Pizza Hut (LSR in some convenient, adaptable to myriad flavors markets, FSR in others and both in and toppings, can be premium or many), Domino’s and Papa John’s. budget, healthy or comforting and, Ranked No. 6 among global pizza importantly, highly suitable for delivery. chains by unit count, South Africa- Among Technomic’s Global 150 based Debonairs Pizza is the top brand ranking of the largest global restaurant not based out of America. The South chains by unit count, 11% are pizza or Africa-based chain is followed by Italian/pizza. That’s a huge chunk Canada’s Pizza Pizza and the U.K.’s relative to other major categories, on PizzaExpress (AKA PizzaMarzano in par with burger (10.5%) and besting many parts of the world). chicken (9.3%) and sandwich (3.3%). Learn much more about the global Not surprisingly, the vast majority (76%) pizza landscape from a post-pandemic of the top pizza chains are limited perspective with Technomic’s new 2021 service, with four full serves on the list Global Pizza Category Report. (all from Europe and North America).

Note: Global rankings by unit count; Image Source: Shutterstock Chains based in the United States must operate in two or more international markets and have a meaningful location footprint outside of the U.S. to be eligible for inclusion Source: Technomic Global Foodservice Navigator Program

COVID-19 PERCENT PERCENT TOP 5 MOST DISRUPTED MARKETS DISRUPTION COVID-19 Disruption Index is Change Versus Previous Week and CHANGE CHANGE BY INDEX POINT CHANGE INDEX powered by Shortest Track, utilizing AI, Month VERSUS VERSUS (VERSUS PREVIOUS WEEK) (MAX: 1.00, HIGH machine learning and disparate sets of Change versus previous week/month LAST WEEK LAST MONTH DISRUPTION) data resources to quantify the potential allows users to see if the market is risks that U.S. businesses face from the becoming more or less disrupted over spread of the COVID-19 virus at the time. Changes that are positive (+) 1 Santa Fe, N.M. 0.739 4.60% 1.96% market level. show a move toward becoming increasingly more impacted by COVID- 2 Albuquerque, N.M. 0.774 4.26% 1.72% The highest index possible is 1.00, 19 (not good). Changes that are which is not good and reflects markets negative (-) show a trend toward being 3 Modesto, Calif. 0.395 6.21% 12.02% that are extremely disrupted. The index less impacted by COVID-19 (good). is updated on a weekly basis. San Jose-Sunnyvale- 4 0.426 5.49% 10.60% Ignite Subscribers: Download full Santa Clara, Calif. The COVID-19 Disruption Risk Index market report shares weekly updates through a 5 Santa Rosa, Calif. 0.432 5.27% 10.23% business lens, rather than a health lens, and incorporates more than 20 different data signals to measure disruption and predict future impact. These signals include infection rates, deaths, state- level restrictions and social distancing requirements, population densities and mobility, group size limitations and lifestyle risk factors contributing to spread. More information is available HERE.

Notes: Data updated April 12, 2021 Source: Shortest Track

Since 1966, we have You can get this Ignite Company Ignite Menu See where restaurant chains Pinpoint the latest menu trends produced in-depth report delivered to are, how many units they have and see what’s on the horizon. research focused on the you bi-weekly! and how well they’re doing. Explore>> Explore>> foodservice industry. Sign up here>> We provide insights into consumer, industry and menu trends in the U.S., Canada and 23 countries around the world.

Our team of experts helps leaders Ignite Consumer Global Foodservice in the industry make complex Get to know your customers’ Navigator business decisions, set strategy customers through 60+ attributes Understand the global industry, and stay ahead of the curve. and visit occasion metrics. from menu trends to consumers, Explore>> in 25 countries. Explore>> Have questions about this report? Reach out to us today.

312-876-0004 [email protected] technomic.com