Chick-fil-A Is Now Third Largest U.S. Restaurant Chain

Only McDonald’s and Starbucks outsell the stores with the spotted cow ads.

June 24, 2019

ATLANTA—With the help of a team of spotted cows who communicate via various advertising tools, Chick-fil-A has moved up the ranks from the seventh-largest restaurant chain in the United States to become the third.

According to The Washington Post, the chicken sandwich chain has passed Wendy’s, Burger King, Taco Bell and Subway to gross $10.46 billion in American store sales, a figure up 17% for the year. Only McDonald’s ($38.52 billion in U.S. sales) and Starbucks ($20.49 billion) did better.

Chick-fil-A locations brought in an average of $4.6 million each in 2018, up from $4.2 million in 2017. That’s triple the sales of the next big chicken competitor, KFC.

David Portalatin, food industry expert for The NDP Group, the Chicago-based market research firm, said Chick-fil-A’s ascent is more noticeable because everyone else is treading water.

“The industry as a whole is very flat,” he said. “It’s all about demographics, where our population is shifting, from a life-stage perspective. Where total restaurant traffic increased less than 1%, Chick-fil-A saw double-digit growth.”

As baby boomers age, they are eating out less often, and millennials, who depend on restaurants more than any other group, are still eating out less than Generation X did at their age.

Chick-fil-A still has challenges, from its faith-based decision to remain closed on Sundays (a problem for locations in airports and sports stadiums) to its management’s statement opposing same-sex marriage, which has prompted organized boycotts and demonstrations.  

There are reasons the American Customer Satisfaction Index has rated it the No. 1 company for the past four years. First, grand openings are big. For each of the nearly 100 new franchises opened annually since 2003, the parking lot fills with tents for a sanctioned overnight “First 100 Campout.” The first 100 people through the door of the new outlet the next morning win Chick-fil-A for a year (actually, 52 No. 1 meals). Second, those waffle fries have set the restaurant apart from competitors since they were invented in the ‘60s.

But industry experts agree that the biggest distinguishing feature for Chick-fil-A is the customer experience. “The level of customer satisfaction is highly differentiated from many of their fast-food peers,” Portalatin said.

Aaron Allen, a global restaurant consultant, said some of this is the speed of the drive-through and a culture of saying “please” and “thank you” and “my pleasure.” In 2016, the chain debuted what it called Mom’s Valet (which let parents order at the drive-through, then go inside where a Chick-fil-A employee would have a table ready). More recently, the company launched a successful app, and it is routine for employees to walk the drive-through line taking tablet orders to expedite the line of customers in cars.

Allen also credits some of the brand’s success to how it has grown. “There are a couple of paths to growth,” he said. “You can cherry-pick markets like Shake Shack. Or you can grow in concentric circles like Chick-fil-A. Then you’re gaining economies of scale in terms of market share saturation, and your supply chain can grow with you.”

He predicts that the chain’s success will continue. “Half of all meals are now eaten in restaurants, half of those as fast food, and half of those are just 10 companies. Chick-fil-A is now one of them,” Allen says.

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