Different Types of Restaurants
If you've decided to open a restaurant, you probably already know whether you want to offer gourmet desserts, barbecue and burgers, or ethnic cuisine. But have you decided which restaurant type will best suit your menu? There are four main restaurant types to choose from: quick service, fast casual, casual dining, and fine dining. The evolving restaurant industry means these categories are loose descriptions instead of confining expectations, and you'll find that a few quick-service and fast casual restaurants listed here as examples are already sandwiched between two classifications.
Defined: A restaurant with little-to-no table service that aims to rapidly make and serve large quantities of food
Typical entrée price: Less than $8
Popular concepts: Burgers, chicken, and Mexican food
Examples: Chick-fil-A, McDonald's, Taco Bell
These restaurants are more commonly referred to as "fast food," but that term has been weighed down with a poor reputation. Quick-service restaurant (QSR) is the currently preferred moniker, since it emphasizes the institution's main perk: fast service. Usually equipped with a drive-thru, QSRs are a popular choice for busy customers who need a full meal or snack but are in a time crunch. The quality expectations for QSRs vary, as public opinion rarely reaches a consensus, with some massive chains derided for what consumers perceive as mediocre fare while others are generally considered to be of a higher quality. 1 Also worth noting in this category is Panda Express, one of the only Asian chains known for drive-thru accessibility.
Not interested in having a drive-thru? You can still give customers fast service with a menu offering easily transported meals that can be prepared quickly. Popular sandwich shops like Jimmy John's and Firehouse Subs blur the line between QSR and fast casual by emphasizing inside seating but creating fast food that is also portable. Although pizza can't be eaten on the go, popular take-and-bake concept Papa Murphy's, which doesn't deliver or offer drive-thru convenience, has found success by inviting customers to pick up pre-prepared pizzas and bake them at home.
Fast Casual Restaurant
Defined: A restaurant with limited table service that encourages customers to dine in but prepares and serves food quickly after it is ordered
Typical entrée price: $8 to $12
Popular concepts: Burgers, sandwiches, and Mexican and Asian food
Examples: Chipotle, Panera Bread, Shake Shack
Bridging the gap between QSR and casual dining, fast casual restaurants usually offer counter service and seating. This type of restaurant is especially popular during lunch because it's considered by many to bemore refined than a fast food joint and doesn't take as long as a full-service restaurant. In addition to that convenience, these restaurants advertise their use of higher-quality ingredients with buzzwords like "natural" and "fresh," bringing to mind the farm-to-table movement. This focus helps customers feel like they're eating healthier, even if the actual calorie counts don't always check out.2 Although it has more recently struggled with notorious food safety issues, the popular Tex-Mex chain Chipotle, which proclaims it offers "food with integrity," is often given credit for driving the fast casual sector's rapid growth.
What else makes fast casual unique? Compared to full-service restaurants, these types of restaurants experience a higher table turnover rate and their focus on take-out orders lets them serve more customers with a smaller dining room. If a customer wants to sit down and grab a quick meal, the modern and comfortable fast casual dining room seems preferable to the plastic dining room found in some outdated QSRs. The popularity of fast casual has spurred change in those outdated QSRs, from remodels to healthier menu options. The carry-out option is another fast casual feature many full-service restaurants have begun to emulate in an attempt to keep up, but some fast casual chains are taking it one step further: Panera is rolling out delivery.4
Casual Dining Restaurant
Defined: A restaurant with full table service that provides a relaxed atmosphere and a lengthy menu
Typical entrée price: $12 to $25
Popular concepts: American, Mexican, Asian, and Italian food
Examples: Applebee's, Bonefish Grill, Cheesecake Factory
Although casual dining restaurants are being threatened by the rise of fast casual, this restaurant type remains one of the most popular because of the full-service dining experience. These restaurants offer full table service and a relaxed atmosphere that is inviting to customers who want to sit down and enjoy a meal. However, the typical price range in this category is wide enough that public perception and expected food quality can vary greatly. While a large chain like Applebee's might be perceived as an affordable option for families, places like The Cheesecake Factory and Bonefish Grill are often seen as more of a splurge, so expectations for atmosphere, service, and food are inevitably higher.
So, what concept is right for a casual dining restaurant? The possibilities are nearly endless, as the adaptability of this restaurant type makes it compatible with a variety of concepts that want to offer full table service in a casual environment. Applebee's and The Cheesecake Factory both offer extensive menus, while Bonefish Grill, another higher-end casual dining concept, has carved out a niche for its seafood-based menu. Ethnic cuisine is also popular in this sector, with restaurants like P.F. Chang's offering Asian-inspired dishes, On the Border providing classic Mexican food, and Olive Garden known for its take on Italian cuisine. To capture the lunch market, many of these casual restaurants push pared-down lunch menus, lighter options, and happy hours that convince midday diners to pause and sit down instead of grabbing something on the go.5
Defined: An upscale restaurant with full table service and focused menus with high-quality food
Typical entrée price: $25 or more
Popular concepts: Seafood and steakhouses
Examples: The Capital Grille, The Palm, Ruth's Chris
This type of restaurant has the broadest definition as far as price is concerned, but can usually be spotted by the white tablecloths, excellent service, and dress codes, whether unspoken or explicit. Because fine-dining restaurants are perceived as an upscale option with a higher price tag – a $25 main course is on the lower end, and upwards of $35 is a better estimate – expectations are especially high for food quality, atmosphere, and overall experience. This means that fine-dining restaurants have both a higher average check and are typically more costly to open. Although they can be lucrative, not every concept can be worked into a fine-dining restaurant. Diners equate certain foods, like seafood and steak, with quality and will be willing to pay more for them, while more common dishes like burgers and sandwiches may be difficult to sell at a higher price.
Is fine dining worth the extra investment? If you have the location and market to support a more expensive restaurant, it might be. The bottom line is that customers believe fine dining food should be superior to meals they can pay for elsewhere. Look at the Darden family of restaurants, which operates Olive Garden and The Capital Grille. An Olive Garden that has been remodeled to appear more upscale but serves the same food would not resonate with customers, but The Capital Grille, which aims to offer expertly prepared steak and seafood dishes in a polished atmosphere, merits the higher price tag.
- Best and Worst Fast-food Restaurants in America. Consumer Reports. July 2014. Accessed July 2016.
- Study: Fast Casual Spots Like Panera, Chipotle Dish Up More Calories Than Fast Food. StarTtribune. June 8, 2016. Accessed July 2016.
- How Fast Casual is Changing QSR. Restaurant Business Online. February 14, 2005. Accessed July 2016.
- Will Delivery Be Panera Bread Co's Next Big Growth Driver? The Motley Fool. February 28, 2016. Accessed July 2016.
- Casual Dining Coming Back to Life. USA Today. April 29, 2015. Accessed July 2016.