CONTENTS 1 EXECUTIVE SUMMARY 1.1 Market Summary 1.1.2 Revised Forecast 1.2 Impact of September 11 and the Economy 1.2.1 Early Recovery for Restaurant Companies 1.2.2 City-by-City Impacts 1.3 Dine Out for America 1.4 Market Trends 1.5 Household Spending on Food Away from Home 1.6 Impact of Demographic Shifts 1.7 Growth Strategies 1.7.1 New Menu Items 1.7.2 Diversification and Acquisition 1.8 Growth in Ethnic Restaurants 1.9 Emerging Challenges 1.9.1 Energy and Retaining Labor 1.9.2 Food Safety 1.9.3 Food Security 1.9.4 Mad Cow and Foot-and-Mouth 1.10 Increased Competition 1.11 The Challenge for Independent Restaurants 1.12 Long-Range Market Forecast PART I: INDUSTRY PROFILE 2 EATING PATTERNS IN AMERICA 2.1 Dining Out 2.2 Consumption Forecast for Food Categories 2.3 Healthy Dining 2.4 Current Hot Trends 2.5 Hot Concepts 2.6 Meat and Poultry 2.7 Seafood 2.8 Vegetables 3 RESTAURANT CHAINS AND FRANCHISES 3.1 Restaurant Brand Market Leaders 3.2 Restaurant Corporations 3.3 Top Growth Chains 3.4 Sales Per Location 3.5 Restaurant Franchises 3.5.1 The Largest Franchisees 3.5.2 Historical Development 3.6 Regional Powerhouse Chains 3.7 International Operations by U.S. Chains 4 INDEPENDENTS AND SMALL UPSCALE RESTAURANT GROUPS 4.1 The Top 25 Independent Restaurant Operators 4.2 The Top 20 Upscale Restaurant Groups 4.3 Ark Restaurant Corporation 4.4 Auger Enterprises 4.5 Avado Brands, Inc. 4.6 Back Bay Restaurant Group, Inc. 4.7 Benson's, Inc. 4.8 The Breakers 4.9 Buckhead Life Restaurant Group 4.10 C.A. Muer Corporation 4.11 Cameron Mitchell Restaurants 4.12 Capital Restaurant Concepts 4.13 Centra Archy 4.14 Clyde's Restaurant Group 4.15 Cobb Investment Company 4.16 Consolidated Restaurants, Inc. 4.17 Copper Cellar Corporation 4.18 D'Amico & Partners, Inc. 4.19 Gastronomy, Inc. 4.20 Grandma's, Inc. 4.21 Haddad Restaurant Group, Inc. 4.22 Harman Nickolas Restaurant Group 4.23 Kimpton Hotel & Restaurant Group 4.24 Latour Management, Inc. 4.25 Lettuce Entertain You Enterprises 4.26 Mad Anthony's 4.27 Moe's Fisherman Exchange 4.28 Myriad Restaurant Group 4.29 Pacific Coast Restaurant, Inc. 4.30 Parasole Restaurant Holdings, Inc. 4.31 The Patina Group 4.32 Performance Restaurant Group 4.33 Phillips Crab House 4.34 Real American Restaurants 4.35 Restaurant Development Group 4.36 Restaurants Unlimited 4.37 Schelde Enterprises, Inc. 4.38 Schwartz Brothers Restaurants 4.39 Select Restaurants 4.40 Smith & Wollensky Rest. Group 4.41 Speciality Restaurants Corporation 4.42 TS Restaurant, Inc. 4.43 Unique Restaurant Corporation PART II: PROFILES OF KEY PLAYERS 5 RESTAURANT CORPORATIONS 5.1 Overview 5.2 Advantica Restaurant Group, Inc. 5.3 AFC Enterprises, Inc. 5.4 American Restaurant Group, Inc. 5.5 Avado Brands, Inc. 5.6 Brinker International, Inc. 5.7 Buffets, Inc. 5.8 Cracker Barrel, Inc. 5.9 CKE Restaurants, Inc. 5.10 Darden Restaurants, Inc. 5.11 Diageo PLC 5.12 Landry's Seafood Restaurants, Inc. 5.13 McDonald's Corporation 5.14 Metromedia Restaurant Group 5.15 Outback Steakhouses, Inc. 5.16 Prandium, Inc. 5.17 Rare Hospitality International, Inc. 5.18 Ruby Tuesday, Inc. 5.19 Shoney's, Inc. 5.20 Wendy's International, Inc. 5.21 Yum Brands, Inc. 5.22 Other Key Players 6 RESTAURANT CHAINS 6.1 The Top 75 Chains 6.2 Applebee's Neighborhood Grill & Bar 6.3 Arby's 6.4 Baskin-Robins 6.5 Bennigan's 6.6 Big Boy 6.7 Blimpie Subs & Salads 6.8 Bob Evans Restaurants 6.9 Boston Market 6.10 Burger King 6.11 Captain D's 6.12 Carl's Jr. 6.13 Checker's Drive-In/Rally's 6.14 The Cheesecake Factory 6.15 Chick-fil-A 6.16 Chili's Grill & Bar 6.17 Chuck E. Cheese's 6.18 Church's Chicken 6.19 Coco's 6.20 Cracker Barrel Old Country Store 6.21 Dairy Queen 6.22 Denny's 6.23 Domino's Pizza 6.24 Dunkin' Donuts 6.25 Fazoli's 6.26 Friendly's 6.27 Golden Corral 6.28 Hard Rock Café 6.29 Hardee's 6.30 HomeTown Buffet 6.31 Hooters 6.32 International House of Pancakes 6.33 Jack in The Box 6.34 KFC 6.35 Krispy Kreme Doughnuts 6.36 Krystal 6.37 Little Caesars Pizza 6.38 Lone Star Steakhouse & Saloon 6.39 Long John Silver 6.40 Luby's 6.41 Marie Callender's 6.42 McDonalds Corporation 6.43 O'Charley's 6.44 Old Country Buffet 6.45 The Olive Garden 6.46 Outback Steakhouse 6.47 Panera Bread Co. 6.48 Papa John's Pizza 6.49 Perkins Family Restaurants 6.50 Piccadilly Cafeteria 6.51 Pizza Hut 6.52 Pizzeria Uno Chicago Bar & Grill 6.53 Ponderosa/Bonanza 6.54 Popeyes Chicken & Biscuits 6.55 Red Robin 6.56 Red Lobster 6.57 Romano's Macaroni Grill 6.58 Round Table Pizza 6.59 Ruby Tuesday 6.60 Ryan's Family Steak House 6.61 Sbarro, Inc. 6.62 Schlotzky's Deli 6.63 Shoney's 6.64 Sizzler 6.65 Sonic Drive-Ins 6.66 Starbucks Coffee 6.67 Steak 'n Shake 6.68 Subway Sandwiches & Salads 6.69 T.G.I. Friday's 6.70 Taco Bell 6.71 Tim Hortons 6.72 Tony Roma's 6.73 Waffle House 6.74 Wendy's International, Inc. 6.75 Whataburger, Inc. 6.76 White Castle 7 FOODSERVICE CONTRACT MANAGEMENT COMPANIES 7.1 Overview 7.2 All Seasons Service, Inc. 7.3 Aramark 7.4 Bon Appetit Management Company 7.5 CA One Services, Inc. 7.6 Cara Operations Limited 7.7 Compass Group 7.8 Dobbs International Services 7.9 Fine Host Corporation 7.10 Guest Services, Inc. 7.11 Gunkenheimer 7.12 HDS Services 7.13 HMSHost Services Corporation 7.14 The Levy Restaurants 7.15 LSG Sky Chefs 7.16 Morrison Management Specialists 7.17 ServiceMaster Management Services 7.18 Sodexho Marriott Services 7.19 Sportservice Corporation 7.20 The Wood Company 7.21 Volume Services America PART III: MARKETING 8 ADVERTISING 8.1 Market Assessment 8.2 Advertising Expenditures by Restaurant Corporations 8.3 Restaurant Advertising and the Economy 8.4 Primetime Network Advertising 8.5 Cable Network Advertising 8.6 Extreme Marketing 8.7 Target Advertising 8.8 Online Advertising 8.9 Discount Promotions 8.10 Promotions for Kids 8.11 Contests 8.12 Movie Tie-Ins 8.13 Giveaway Toys 8.14 Logo Apparel 8.15 Public Relations and Restaurant Publicity 8.16 Community Involvement 9 BRANDING 9.1 Branding and Concept Integration 9.2 The Top Restaurant Brands 9.3 Brand Strategy 9.4 Co-branding 9.5 Rebranding 9.6 Restaurant Brands Team With Retail Brands 9.7 Case Study 10 CONSUMER STRATEGIES 10.1 Consumer Market Drivers 10.2 Segment Selection 10.3 Attracting Repeat Business 10.4 Customer Service 10.5 Reducing Customer Wait Time 10.6 Frequent Dining Programs 10.7 Mystery Shoppers 10.8 Image Enhancement 10.9 The Huge Disability Market 10.10 Location Considerations 10.11 Restaurant Design Considerations PART IV: STRATEGIC PERSPECTIVES 11 GOURMET 11.1 Celebrity Chefs 11.2 James Beard Foundation Awards 11.3 Star and Diamond Awards 11.4 Fine Dining Hall of Fame 11.5 Food Television 11.6 Food Radio 11.7 The Culinary Institute of America 11.8 The American Culinary Federation 11.9 Best New Chefs 11.10 Chefs as Lures for Tourists 11.11 Gourmet Dining in Las Vegas 12 INTERNET APPLICATIONS IN THE RESTAURANT BUSINESS 12.1 Internet Applications 12.2 Online Restaurant Reservations 12.3 Ordering Meals Online 12.4 Internet Solutions at McDonald's 12.5 Electronic Networks 12.6 Intranets 13 INVESTMENT ANALYSIS 13.1 The Restaurant Sector 13.2 Publically-Traded Restaurant Corporations 13.3 Mergers and Acquisitions 13.4 Restaurant IPOs 13.5 Chapter 11 Bankruptcy Filings 13.6 Analysts PART V: MARKET SECTORS 14 MEALS AND SNACKS 14.1 Daypart Market Growth 14.2 Dinner 14.3 Lunch 14.4 Breakfast 14.5 Appetizers and Salads 14.6 Desserts 14.7 Breads 14.8 Snacks 14.9 Late-Night and 24-Hour Service 14.10 Changing Meal Patterns 15 CUISINE 15.1 Overview 15.2 American/Continental 15.3 Ethnic Cuisines 15.4 Italian 15.5 Latin American 15.6 Mexican 15.7 Asian 15.8 French 15.9 African Cuisine 15.10 Indian Cuisine 15.11 Seafood 15.12 Kosher 15.13 Vegetarian 15.14 Salads 15.15 Soup 15.16 Sandwiches and Burgers 15.17 Regional Cuisine 16 QUICKSERVICE, LIMITED-SERVICE AND FAST-CASUAL 16.1 Market Assessment 16.2 Market Growth 16.2.1 Co-Branding 16.3 Drive-Thru's 16.4 Fast Casual 16.5 Cafeterias and Buffets 16.5.1 Market Trends 16.5.2 Market Leaders 16.5.3 Current Market Activities and Future Strategic Plans 16.6 Pizza 16.6.1 Market Trends 16.6.2 Market Leaders 16.6.3 Current Market Activities and Future Strategic Plans 16.7 Burger QSRs 16.7.1 Market Trends 16.7.2 Market Leaders 16.7.3 Current Market Activities and Future Strategic Plans 16.7.4 Non-Beef Burgers 16.8 Sandwiches and Bakery-Café Fast-Casual 16.8.1 Market Trends 16.8.2 Market Leaders 16.8.3 Current Market Activities and Future Strategic Plans 16.9 Chicken QSRs 16.9.1 Market Trends 16.9.2 Market Leaders 16.9.3 Current Market Activities and Future Strategic Plans 16.10 Seafood QSRs 16.10.1 Market Trends 16.10.2 Market Leaders 16.10.3 Current Market Activities and Future Strategic Plans 16.11 Mexican QSRs 16.11.1 Market Trends 16.11.2 Market Leaders 16.11.3 Current Market Activities and Future Strategic Plans 16.12 Italian QSRs 16.12.1 Market Trends 16.12.2 Market Leaders 16.12.3 Current Market Activities and Future Strategic Plans 16.13 Asian QSRs 16.13.1 Market Trends 16.13.2 Market Leaders 16.13.3 Current Market Activities and Future Strategic Plans 16.14 Hot Dogs 16.12.1 Market Trends 16.12.2 Market Leaders 16.12.3 Current Market Activities and Future Strategic Plans 16.12.4 Famous Independent Hot Dog Restaurants 16.15 Snack Food Chains 16.15.1 Market Trends 16.15.2 Market Leaders 16.15.3 Current Market Activities and Future Strategic Plans 16.16 Doughnut Shops 16.16.1 Market Trends 16.16.2 Market Leaders 16.16.3 Current Market Activities and Future Strategic Plans 16.17 Gourmet Coffee Shops 16.18 Ice Cream and Yoghurt 16.18.1 Market Trends 16.18.2 Market Leaders 16.18.3 Current Market Activities and Future Strategic Plans 16.19 Bagels 16.19.1 Market Trends 16.19.2 Market Leaders 16.19.3 Current Market Activities and Future Strategic Plans 16.20 Convenience Stores 16.20.1 Market Trends 16.20.2 Market Leaders 16.21 Truck Stops 16.22 QSR Success Strategies 17 FULL-SERVICE DINING 17.1 Market Assessment 17.2 Menu Prices 17.3 Market Growth in Upscale Casual 17.4 Independents versus Chains 17.5 Steakhouses 17.5.1 Market Trends 17.5.2 Market Leaders 17.5.3 Independent Steakhouses 17.5.4 Fine Dining Steakhouses 17.5.5 Casual Dining Steakhouses 17.5.6 Grill-Buffet Steakhouses 17.5.7 Current Market Activities and Future Strategic Plans 17.6 Casual Dining 17.6.1 Market Trends 17.6.2 Market Leaders 17.6.3 Current Market Activities and Future Strategic Plans 17.7 Seafood Casual Dining Restaurants 17.7.1 Market Trends 17.7.2 Market Leaders 17.7.3 Independent Seafood Restaurants 17.7.4 Current Market Activities and Future Strategic Plans 17.8 Italian Casual Dining Restaurants 17.8.1 Market Trends 17.8.2 Market Leaders 17.8.3 Current Market Activities and Future Strategic Plans 17.9 Mexican Casual Dining Restaurants 17.9.1 Market Trends 17.9.2 Market Leaders 17.9.3 Current Market Activities and Future Strategic Plans 17.10 Asian Casual Dining Restaurants 17.10.1 Market Trends 17.10.2 Market Leaders 17.10.3 Current Market Activities and Future Strategic Plans 17.11 Barbeque Casual Dining Restaurants 17.11.1 Market Trends 17.11.2 Market Leaders 17.11.3 Current Market Activities and Future Strategic Plans 17.12 Family Dining 17.12.1 Market Trends 17.12.2 Market Leaders 17.12.3 Current Market Activities and Future Strategic Plans 17.13 Microbrewery Restaurants 17.14 Dinner House Restaurants 17.14.1 Market Trends 17.14.2 Market Leaders 17.14.3 Current Market Activities and Future Strategic Plans 17.15 Fine Dining Chains 17.16 QSR Success Strategies 18 EATERTAINMENT 18.1 Market Assessment 18.2 Theme Restaurants 18.3 The Sector Recovers 18.4 The Problem of Classification 18.5 Amusement Center Restaurants 18.6 Kid Eatertainment 18.7 Other Eatertainment Concepts 18.8 Retail Merchandise Sales 19 TAKEOUT, HOME-MEAL REPLACEMENTS AND DELIVERY 19.1 Market Assessment 19.2 Demographics 19.3 Market Leaders: Takeout or Delivery Specialty Restaurants 19.4 Current Market Activities and Future Strategic Plans 19.5 Competition Among Food Sectors 19.6 Take Out Growth in Casual Dining Chains 19.7 Full-Service Drive-Thrus 19.8 Characteristics of Takeout Customers 19.9 Innovative Approaches to Takeout 19.10 Restaurant-Branded Grocery Products 19.11 Take-Out for Super Bowl 19.12 Take-Home Meals from the Office 19.13 Dining Leftovers 19.14 Market Outlook 20 BEVERAGES 20.1 Market Assessment 20.2 Non-Alcoholic Beverages 20.3 Alcoholic Beverages 20.4 Impact of the Economy on Restaurant Wine Sales 20.5 Bottled Water 20.6 Coffee 20.7 Milk 20.8 Trends in Alcohol Consumption in the United States 20.9 Fine Dining Restaurant Wine Programs 21 CATERING 21.1 Market Assessment 21.2 Trends and Current Activities 21.3 Banquets 22 CONTRACT FOODSERVICE 22.1 Market Assessment 22.2 Market Leaders 22.3 Hospitals 22.4 Nursing Homes and Assisted-Living 22.5 Primary and Secondary Schools 22.6 Universities 22.7 Business and Industry 22.8 Recreation 22.9 Correction Facilities 22.10 Military 22.11 Other Contract Foodservice Market Segments 23 HOTEL RESTAURANTS 23.1 Market Assessment 23.2 Market Leaders 23.3 The Role of Restaurants in Hotel Operations 23.4 Hotel/Restaurant Partnerships 23.5 Dining in Upscale and Luxury Hotels 23.6 Restaurant Affiliations in the Limited-Service Sub-segment 23.7 Hotel Room Service 23.8 Building Local Restaurant Business 23.9 Casino Hotel Restaurants 23.10 Resort Hotel Restaurants 23.11 Offsite Hotel-Branded Restaurant Ventures 23.12 Award-Winning Hotel Dining 24 MALLS AND RETAIL LOCATIONS 24.1 Market Assessment 24.2 Shopping Centers and Malls 24.3 Shopping Mall Food Courts 24.4 Restaurants in Department Stores 24.5 Restaurants in Discount Stores 24.6 Book Store Cafes 24.7 Future Trends 25 AIRPORTS 25.1 Market Assessment 25.2 Airport Food and Beverage Sales 25.3 Impact of September 11 and the Economy 25.4 National Chains at Airports 25.5 Independent Operators at Airports 25.6 Carry-On Food 25.7 Market Leaders 25.7.1 Anton Airfood 25.7.2 CA One Services 25.7.3 Concessions International 25.7.4 HMSHost 25.7.5 Select Service Partners 26 SPORTS CONCESSIONAIRES 26.1 Market Assessment 26.2 Market Leaders 26.3 Foodservice at Sports Venues 26.4 Market Trends 27 FOODSERVICE AT ENTERTAINMENT VENUES 27.1 Overview 27.2 Market Opportunities 27.3 Theme Parks 27.4 Fairs 28 COFFEE SHOPS 28.1 Market Assessment 28.2 Marketshare Leaders 28.3 Market Trends 28.4 Current Market Activities and Future Strategic Plans 28.5 Consumer Trends 28.6 The Coffee House in American Lifestyle 28.7 Consumer Demographics 28.8 Growth in Non-Coffee Food and Drink 28.9 Non-Coffee Merchandise 28.10 Coffee Shop Internet Access 29 BARS AND TAVERNS 29.1 Market Assessment 29.2 Drinking Places 29.3 Themed Bars 29.4 Brew Pubs 29.5 Night Clubs 29.6 Smoke-Free Bars 29.7 Interactive Games in Bars 29.8 Demographics 30 SPORTS BARS AND RESTAURANTS 30.1 Sports Bars 30.2 Sports Restaurants 31 FOODSERVICE ON COMMERCIAL TRANSPORTATION 31.1 Market Assessment 31.2 Airlines 31.3 Cruise Ships 31.4 Amtrak 32 TRAVEL AND BUSINESS DINING 32.1 Opportunities in Tourist Dining 32.2 The Impact of September 11 and Outlook of 2002-2003 32.3 Consumer Economic Concerns Outweigh Travel Fears 32.4 Impact Varies by City 32.5 Business Travel 32.6 Summer Vacations 2002 32.7 Road Food 32.8 Dining as a Travel Alternative 33 HOLIDAY DINING 33.1 Overview 33.2 Birthdays 33.3 Valentine's Day 33.4 Mother's Day 33.5 Father's Day 33.6 New Year's Eve 33.7 Easter 33.8 Thanksgiving 33.9 Cinco de Mayo 33.10 St. Patrick's Day 33.11 Oktoberfest 33.12 La Diada de Sant Jordi 34 FOOD FESTIVALS 34.1 Market Assessment 34.2 Food Festivals as a Restaurant Promotional Tool 34.3 The Largest Food Festivals 34.4 Commercial Food Festivals 34.5 Regional Food Celebrations 34.6 Wine Festivals 34.7 Case Study 34.8 Food at State Fairs 34.9 QSR Chains at Festivals 35 UNIQUE RESTAURANT CONCEPTS 35.1 Overview 35.2 Live Entertainment Restaurants 34.3 Rib America: The First Food Festival Chain 35.4 Cyber Cafes 35.5 Historic Restaurants 35.6 Dog-Friendly Restaurants 35.7 Novel Restaurants 35.7 Unique Names PART VI: DEMOGRAPHICS 36 CUSTOMER DEMOGRAPHICS 36.1 Restaurant Patrons 36.2 Generational Marketing 36.3 Customer Diversity 37 REGIONAL MARKETS 37.1 Market Assessment of Top Cities 37.2 State-By-State Restaurant Sales 37.3 Restaurant Market Assessment in the Top 75 MSAs 37.4 New York-Northern New Jersey-Long Island 37.5 Los Angeles-Riverside-Orange County 37.6 Chicago-Gary-Kenosha 37.7 Washington-Baltimore 37.8 San Francisco-Oakland-San Jose 37.9 Philadelphia-Wilmington-Atlantic City 37.10 Boston-Worcester-Lawrence-Lowell-Brockton 37.11 Detroit-Ann Arbor-Flint 37.12 Dallas-Fort Worth 37.13 Houston-Galveston-Brazoria 37.14 Atlanta 37.15 Miami-Fort Lauderdale 37.16 Seattle-Tacoma-Bremerton 37.17 Cleveland-Akron 37.18 Phoenix-Mesa 37.19 Minneapolis-St. Paul 37.20 San Diego 37.21 St. Louis 37.22 Pittsburgh 37.23 Denver-Boulder-Greeley 37.24 Tampa-St. Petersburg-Clearwater 37.25 Portland-Salem 37.26 Cincinnati-Hamilton 37.27 Kansas City 37.28 Sacramento-Yolo 37.29 Milwaukee-Racine 37.30 Norfolk-Virginia Beach-Newport News 37.31 San Antonio 37.32 Indianapolis 37.33 Orlando 37.34 Columbus 37.35 Charlotte-Gastonia-Rock Hill 37.36 New Orleans 37.37 Las Vegas 37.38 Salt Lake City-Ogden 37.39 Buffalo-Niagra Falls 37.40 Greensboro-Winston-Salem-High Point 37.41 Nashville 37.42 Hartford 37.43 Rochester 37.44 Memphis 37.45 Austin-San Marcos 37.46 Raleigh-Durham-Chapel Hill 37.47 Jacksonville 37.48 Oklahoma City 37.49 Grand Rapids-Muskegon-Holland 37.50 West Palm Beach-Boca Raton 37.51 Louisville 37.52 Dayton-Springfield 37.53 Richmond-Petersburg 37.54 Providence-Warwick-Pawtucket 37.55 Greenville-Spartanburg-Anderson 37.56 Birmingham 37.57 Albany-Schenectady-Troy 37.58 Honolulu 37.59 Fresno 37.60 Tucson 37.61 Tulsa 37.62 Syracuse 37.63 El Paso 37.64 Omaha 37.65 Albuquerque 37.66 Knoxville 37.67 Bakersfield 37.68 Scranton-WilkesBarre-Hazleton 37.69 Harrisburg-Lebanon-Carlisle 37.70 Allentown-Bethlehem-Easton 37.71 Toledo 37.72 Youngstown-Warren 37.73 Springfield, Mass. 37.74 Baton Rouge 37.75 Little Rock-North Little Rock 37.76 Stockton-Lodi 37.77 Sarasota-Bradenton 37.78 Wichita APPENDIX: MARKET RESOURCES A.1 Directories A.2 Associations A.3 Analysts and Market Consultants A.4 Periodicals A.5 Government Agencies REFERENCES