5 Restaurant Chains Making the Biggest Comebacks Right Now
Everyone loves a good comeback story, and for the restaurant industry, it's no different. Whether it's about a big, national franchise getting back to its roots, or a small regional chain buckling down and realizing its full potential, the "comeback story" is the definitive best-selling menu item, bar none.
The fall-off/comeback cycle is a common occurrence in the U.S. restaurant industry and shows no signs of subsiding. Here's a look at five major restaurant chains that are making the biggest comebacks right now.
And don't miss 4 Major Burger Chains Falling Out of Favor With Customers.
Applebee's has been around since 1980, and in its more than forty years of operation has seen more than its fair share of highs and lows. As broken down by The Company Man, Applebee's was in a slump for much of the 2010s, with little to no footprint growth, an acquisition by IHOP, and a failed re-branding effort in 2016 (remember those Wood-Fired Grills and Hand-Cut Steaks?). But "Eatin' Good in the Neighborhood" has made a solid comeback in the past few years, following the success of beverage deals like the Dollarita and the Dollar L.I.T, consolidation of the chain's U.S. footprint, and expansion into off-premise sales.
"The brand is exceedingly well-positioned right now to thrive, to flourish—use whatever term you want," president John Cywinski told FSR Magazine. "Our franchisees are more enthusiastic than they've ever been. I've got a great set of 30 franchise partners, so we are poised for sustained growth and better-positioned than at any point in my most recent five-year tenure here."
Like countless other sit-down family restaurants, IHOP was hard-hit by the pandemic. Declining sales forced the chain to close nearly 100 restaurants in the U.S., and S&P Global Market Intelligence ranked IHOP's parent company, Dine Brands Global, among the top five restaurants companies most likely to default on their loans.
IHOP held strong, though, and in the past year has taken serious strides toward adapting its business to an off-premise dining model: about a quarter of the chain's sales in the most recent quarter were through takeout and delivery—on par with its performance at the height of the pandemic. IHOP also has plans to launch a duo of new virtual brands—Thrilled Cheese and Super Mega Dilla.
The Chicago-based sandwich chain has had tough past few years. Sales have been declining for about five years and reached new lows in mid-2021. Just a month ago, NASDAQ cautioned investors from purchasing Potbelly stock, which has lost 57% of its value since 2017.
But recently, business has been picking back up. In its most recent quarter, Potbelly reported sales increases of over 30%. Stock prices were up to, with investors receiving a 21% return over a twelve-month period. And the chain is expecting the growth to continue, as it has plans to expand its franchising operation and grow its footprint to 2,000 restaurants in the next ten years.
One of the greatest comeback stories of the pandemic, Golden Corral just about singlehandedly proved that buffets have a future in the U.S. restaurant industry. But it wasn't easy—the chain saw its store count dwindle from a high of 483 in 2019, to only 250 buffets operating last year (some locations were set up as cafeterias instead). Golden Corral had to bail out its own franchisees with deferred royalty payments, and the CEO is still hoping for a second round of restaurant relief funding.
But all things considered, "America's No. 1 Buffet" is now, in 2022, back on the right course. The footprint is currently back up to about 360 units, and off-premise sales are on the rise, thanks to investment in third-party delivery providers. There are even plans for the launch of a new, fast-casual sister brand Golden Corral Steakhouse.
Jack in the Box
The California-based burger chain thrived during the pandemic, attracting higher-income customers, growing its sales, and even gaining some new customers in the process. A recent growth spurt has helped Jack in the Box's footprint expand by 201 restaurants. With plans for more than 6,000 restaurants by 2030, the regional chain has every intention of becoming a major national player within less than ten years.