Fast Food Gaining Ground

The fast food industry is expected to grow at an average 2% annually to $219.3B through 2019, according to new research from IBISWorld. We checked in with local retail guru John Cumbelich to find out what that means for the Bay Area burgers and fries market. He has no doubts that fast food will continue to grow, moderately, for three main reasons.

1. The Bay Area is a very big marketplace. 

There's over 75M SF of regional retail real estate (not including neighborhood centers and strip centers). There is simply too much inventory not to have fast food establishments in the Bay Area, despite the anti-chain store noise makers in SFO and Berkeley. (Above, the sole In-N-Out in the city in Fisherman's Wharf.) Far more communities embrace these brands than reject them, he says. And why not? It’s a good place to get a first job and enter the work force.

2. Dollar menus. 

The great recession fundamentally shifted consumer habits and low priced meals are here to stay. Every fast food establishment has a “value menu. That is an offering that resonates deeply with consumers, he says.

3. The definition of fast food continues to evolve and quality is improving. 

You can get great coffee and healthy salads at places like Krispy Kreme and McDonald's, he says, where ingredients are more heavily scrutinized and regulated. Places like Chipotle and Subway have wholesome offerings, and the success of brands like these has pushed traditional fast food establishments towards a higher standard.