Apr 092003
Authors: Vincent Adams

Susan Vukovich and Nikki Arcieri said they haven’t been to a fast food restaurant in a long time.

Recently, Vukovich, a freshman history major, and Arcieri, a freshman art major, socialized over a burrito from the Chipotle restaurant located across the street from CSU’s campus at 649 S. College Ave.

The pair agreed Chipotle’s food was much better than anything at a typical fast food restaurant.

“The food just tastes better and you get your money’s worth,” Vukovich said.

Arcieri went further, adding Chipotle is “magic in her mouth.”

Vukovich and Arcieri aren’t alone in abandoning fast food for what the food industry is now calling “quick casual” or “fast casual” restaurants.

According to statistics from Chicago-based Technomic, a consultant firm that studies trends for the food industry, the new quick casual restaurant category has been growing 15 percent since 1999, compared to 4 percent for the fast food industry.

Quick casual, which prides itself for having fresh ingredients and quality food at prices similar to an average burger combo meal, accounts for $6 billion, or around 3 percent, of the $263 billion food industry, said Joe Pawlak, principle partner for Technomic.

“They still only have a small share,” he said, “but they are one of the key drivers for the industry.”

Pawlak said quick casual restaurants should continue to grow at 15 percent for the next few years.

He said the fast food industry hasn’t adapted well to consumers’ needs, and that might explain why fast food’s growth is less than quick casual’s.

“People are overall becoming more sophisticated with their food choices,” Pawlak said. “People grew up with fast food, but fast food didn’t grow up with them.”

Jim Adams, a spokesman for Chipotle, agreed with Pawlak and called it an awakening.

“It’s better tasting food,” he said. “It is an awakening of the American palate, it is a definite improvement and it doesn’t cost that much.”

Karen Guido, vice president of marketing for rival, Qdoba, agreed and said, “people are still pressed for time, but they want different options and are willing to pay a little more for better-quality food.”

Both Chipotle and Qdoba market for consumers willing to pay $5 to $7 for a meal.

Despite the steady increase in growth, Adams said he doesn’t expect quick casual to replace the fast food industry.

“Fast food is still a multimillion dollar industry,” he said, “and there are not enough players in fast casual, so fast food won’t ever go away.”

The quick casual category in the food industry isn’t only Mexican grill restaurants; it also includes places like Noodles and Co., Fazoli’s, an Italian restaurant, and Boston Market.

The appeal

Pawlak said the primary demographic for quick casual is 22 to 45 year olds. But that demographic is changing fast and college students of all ages frequent many quick casual restaurants, which is evident by looking at the faces of clientele who frequent the Qdoba and Chipotle close to CSU’s campus.

“Students are the majority of our customers,” said Frannie Sugiarto, manager at the Chipotle near CSU’s campus. “Weekends are the busiest, Friday nights especially. That is when a lot of them are done with school for the week. They often come here before they go out.”

Aside from the better-quality food, the CSU students, Vukovich and Arcieri, said the food is fresh and promotes good health.

“It is definitely healthier,” Vukovich said, “you’re not getting all that grease and it’s (ingredients are) more well-rounded.”

While not all the ingredients are healthy, say sour cream, quick casual gives you the opportunity to choose healthily, which is something fast food restaurants struggle to do, said Guido, the Qdoba marketing vice president.

“You have the ability to customize to make it healthy,” she said. “There is not a lot of deep fat frying and the meat is grilled.”

Chipotle’s Adams agreed.

“At many other places you can only order, say, a number 3,” he said. “And there is no variation in that.”

Pawlak said it also helpful for quick casual that people’s definition of health has changed.

“In the 1990s, people said healthy is low fat, low calories. Now people look for food with no fillers and no preservatives,” he said. “People are looking for terms that relate to fresh and natural, and quick casual provides that for people.”

Colorado roots

Chipotle’s Founder, Steve Ells, opened the first restaurant in Denver in 1993, but the chain has since grown to 235 stores nationwide.

Qdoba first opened its doors in 1997, and also started in Colorado. The chain has since expanded to 89 stores nationwide, Guido said.

“When we first started, we put two restaurants in different places, but the areas had similar demographics,” she said. “But when we started putting new restaurants in areas with different demographics, it succeeded, and we realized we had broader appeal than we thought.”

That broader appeal, Guido said, is part of Qdoba’s success.

Adams said Colorado and Ells had a lot to do with creating a successful restaurant niche.

“Steve Ells started something that became very popular,” he said. “Then came a lot of knock-offs. Chipotle’s success signaled the way for others.”

Boston Market also opened its first store in Colorado, and after opening its first store in Wisconsin, Noodles and Co. found a great home in Colorado after opening its second restaurant. Noodles and Co.’s corporate office is also headquartered in Colorado.

The buy out(top)

Even though quick casual, as a category, might be biting into the fast food industry, fast food giants are buying out many of these restaurants in order to keep its piece of the restaurant pie.

McDonalds Corp. owns 89 percent of Chipotle, and in late 2002, Jack in the Box bought out Qdoba.

Guido said that Jack in the Box’s buying of Qdoba is not bad for the restaurant chain and that it also has some advantages.

“We are still operating like we had been,” she said. “The only change is we have more money to grow. Now we are able to open up as many stores as possible as fast as possible.”

But no matter which companies own some quick casual restaurants, consumers will flock to quality products at reasonable prices, CSU student Vukovich said.

“I come (to Chipotle) at least once every two weeks, if not more,” she said. “This is my favorite food in the world.”

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