A significant trend that has been making waves in the restaurant industry: the rising cost of fast food. According to a recent article from MoneyGeek, the average price for a burger, fries, and soda across 189 major and local chains in 50 of the largest cities in the United States has increased by 24% from 2022 to 2024. 

San Diego tops the list as the most expensive city for a fast food meal, with the average cost just under $21. Other cities in the top ten include Washington, DC, Seattle, Boston, etc. What used to be considered a fast, easy, and inexpensive meal now reaching above or close to $20 in major markets. 

However, could this trend could actually provide a lifeline to some of the struggling casual dining restaurants? The answer appears to be a resounding no. Forbes reports that major chains such as TGI Fridays, Mod Pizza, Outback Steakhouse, and Applebee’s have cited underperformance as the primary reason for closing certain restaurant locations. Additionally, chains like Boston Market, Red Lobster, and Tijuana Flats have also shuttered locations due to financial troubles, disputes, and even bankruptcy filings. Denny’s, for instance, has closed almost 60 locations, attributing the closures to higher operating costs.

What we are witnessing a post-COVID correction that might ultimately benefit the overall health of the restaurant industry. The pandemic has undoubtedly reshaped consumer behavior and dining preferences, leading to a reevaluation of business models across the sector. While some restaurants are struggling to stay afloat, others might find new opportunities in this evolving market.

If you’re curious about the factors driving these changes and what the future might hold for both fast food and casual dining establishments, take a listen to the ConStrata Minute. We provide an in-depth analysis of the current state of the restaurant industry and offer insights into potential trends that could shape its future.