Chapter 7
Restaurants
Introduction to Hospitality, Fourth Edition
John Walker
©2006 Pearson Education, Inc.
Pearson Prentice Hall
Upper Saddle River, NJ 07458
Reading and Studying This Chapter,
You Should Be Know About:
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Restaurants
Classifications:
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Independent
Chain
Franchises
Fine Dining
Casual Dining
Quick Service/Fast Food
Trends
Restaurants
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Vital part of everyday life.
Society spends about 50% of our
food dollar away from home.
The word restaurant comes from
the French word meaning
“restore.”
Monsieur Boulanger set up what
many consider the first European
restaurant of modern times in
1765.
Multi-billion dollar business
employing 12.5 million people.
More About Restaurants
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50% of the food dollar
is spent away from
home
Multi-billion dollar
business
Employs 11.7 million
people
Restaurants
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The most popular meal
eaten away from home is
lunch, which brings in about
50% of fast-food restaurant
sales.
Two main categories:
independent and chain
restaurants.
Culinary Greats
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Auguste Escoffier
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Julia Child
Emeril “BAM” Lagasse
Bobby Flay
Charlie Trotter
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Patron Saint of Cooking
Considered America’s
finest
Alice Waters
Paul Prudhomme
Independent Restaurants
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Typically owned by one or
more owners, who are
usually involved in the daily
operation of the business.
Not affiliated with any
national brand or name.
They offer the owner
independence, creativity, and
flexibility, but are
accompanied by the risk of
failing.
Chain Restaurants
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Groups of restaurants,
each identical in market,
concept, design, service,
food, and name.
The same menu, food
quality, level of service,
and atmosphere can be
found in any one of the
restaurants, regardless of
location.
Approximate Market Share of Restaurant
Segments
Full-Service Luxury Restaurants
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National Restaurant Association
Good selection of menu items made on premises
Haute cuisine
Fine Dining Hall of Fame
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Le Bec Fin
Spago
There are few national chains
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Morton’s
Ruth Chris’s
Roy Flemings
Reasons for the Small Number
of Luxury Restaurants
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Labor intensive and require a
higher level of skilled labor
Small percentage can afford
high prices
Overhead costs may not be
reasonable
Economies of scale are not as
easily reaped
Consistency and quality are not
easy to maintain
Limited market appeal
Other Restaurant Classifications
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Theme restaurants
Celebrity-owned
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Owned by celebrities such as
Michael Jordan, Dan Marino,
Steven Segal, Gloria Estefan,
Junior Seau, Denzel
Washington
Seau’s San Diego
All Star Café
House of Blues
Michael Jordan’s
Casual Dining and Dinner
House Restaurants
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Mid-scale casual
restaurants
Family restaurants
Ethnic restaurants
Specialty restaurants
Specialty Restaurants
Quick Service
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Theme related
$111 billion annual sales
Better known as fast food
Limited menus
Guest helps defray labor costs
Quick Service
Hamburger
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McDonald’s and Ray Kroc
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Added breakfast
Expanding overseas
Co-develop sites with gasoline companies
$33 billion worldwide sales
Drive thru
Quick Service
Pizza
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Local and regional chains all with
delivery service
$20 billion market
Four major chains
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Pizza Hut
Domino’s
Papa Johns
Little Caesars
Quick Service
Chicken
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KFC is market
leader
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Home delivery
“3 in 1”
restaurants
Other chains
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Church’s Chicken
Popeye’s
Other Types of
Restaurants
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Steakhouses
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New growth area
Outback Steakhouse
Seafood restaurants
Pancake restaurants
Sandwich restaurants
Family restaurants
Ethnic Restaurants
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Independently owned and
operated
Mexican restaurants are
largest growth segment
Different types are
developing
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Thai
Indian
Trends
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Demographics
Branding
Alternative outlets
Globalization
Continued diversification
More twin and multiple
locations
More points of service
More hyper-theme
restaurants
Chains vs. Independents
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