Throughout the QSR space, breakfast has been a staple product for early sales. Some companies’ breakfast menus have a completely different set of ingredients than their lunch and dinner offerings. However, many have begun to push their breakfast offerings later and later into the day – with some serving them from opening to close. This trend has been coming for years, but the push has been really strong in 2015.
Research has told companies that millennials – one of the largest target consumer groups for fast food and other QSR establishments – are more interested in breakfast than any other type of food. This is a huge shift from previous generations, who viewed breakfast as nothing more than a necessity. This trend is making huge changes within the industry. It has a direct impact on sales, staffing, food cost and many more factors that affect the bottom line.
A lot of franchises traditionally started their business hours around 10am. While this is still within the breakfast window, it is not enough to be considered a whole daypart. With breakfast becoming more popular, the influx of customer traffic has required many franchises to open for business even earlier. This, of course, bumps up the labor numbers greatly. A full breakfast shift, while not being the largest daypart, is still required. This can be both positive and negative, depending on the strength of the breakfast offerings and the ability of the management team to drive early morning sales.
Some breakfast offerings require different equipment than the more traditional lunch affair. While previously, a restaurant could get away with a few fryers and a flat grill, some of the breakfast items might require more specialized equipment, which can become a problem from a logistical standpoint, especially if the franchise chooses to serve breakfast all day. QSR giant McDonald’s has recently begun to feel this pressure – with some franchisees investing as much as $5,000 for new equipment to support the demand for both fries and hash browns throughout the day.
It is not all negative, though. Breakfast offerings are usually a bit cheaper than the rest of the menu, which makes it a lower food cost item. By transitioning to all-day breakfast, a restaurant franchise can save a lot on food costs if they can make their breakfast offerings a focal point. As stated previously, millennials love breakfast. As long as the franchisee offers a menu that is both low-cost and unique, he or she can see a significant return on investment.
I believe the all-day breakfast trend will continue to grow for the foreseeable future. Millennials are quickly replacing baby boomers as the largest demographic and are steadily reshaping the business landscape. And while the breakfast switch seems to be filled with labor intensive, logistical issues, the companies that elect to follow this trend should see good results in their bottom lines. Planting the seeds of future revenue growth starts now while the trend is developing.