The restaurant industry’s wealth is increasingly concentrated at the very top.
The largest chains grew more dominant in 2019. They used their size to flood marketing and social media feeds and get better and more lucrative deals from delivery providers—generating stronger sales and putting more distance between themselves and everybody else.
The top 20 chains accounted for three-quarters of the total sales growth generated by the entire Technomic Top 500. (Scroll down to see a list of the chains.)
What’s more, the 20 largest chains recorded sales growth last year of 5.7%. The rest of the Top 500? 2.4%.
To be sure, those numbers demonstrate weakness scattered throughout the chain universe as much as anything else.
Thirty-seven restaurant chains this year, or about 7% of the Top 500 chains, reported sales declines of 10% or more. That’s up from 34 chains with a 10% decline or more last year. In addition, 183 of the 500 chains in the ranking saw sales decline.
That said, many in the top 20 reported remarkably strong years, none more so than No. 3, Chick-fil-A, where system sales rose 13% to $11.3 billion. That’s a $1.3 billion increase on its own, meaning the Atlanta-based chicken sandwich chain added the equivalent of a Bojangles’ to its system sales in 2019.
That also vaulted it past Taco Bell and Subway to become the third-largest restaurant chain in the U.S. behind McDonald’s and Starbucks.
Yet, on a percentage basis, Chick-fil-A was only the third fastest-growing chain among the top 20. Popeyes Louisiana Kitchen, which generated remarkably strong sales at the end of the year with its new chicken sandwich, surged into the No. 19 spot with 18.3% system sales growth, rising to nearly $600 million.
Chipotle Mexican Grill saw systems sales rise 14.8% to $5.5 billion. The chain generated strong same-store sales in 2019 based largely on marketing improvements and strong digital performance.
The Newport Beach, Calif.-based fast-casual chain used a second makeline for digital orders to improve speed and also marketed delivery heavily, all of which helped it recover sales lost over the past couple of years.
The largest chain in the U.S., McDonald’s, crossed the $40 billion U.S. system sales mark for the first time in its history and also generated more than $100 billion in global sales for the first time.
The Chicago-based burger giant used a handful of efforts to generate those sales, including the use of self-order kiosks and drive-thru screens with artificial intelligence, which increased average check. McDonald’s grew system sales by 4.9% even as unit count declined 0.5% to 13,846 and traffic fell.
Starbucks, meanwhile, saw U.S. system sales rise 8.6% to $21.4 billion as the Seattle-based coffee giant used 3% unit growth and reinvigorated same-store sales to solidify its position as the second-largest U.S. chain.
Taco Bell, meanwhile, grew sales by 9% to just over $11 billion as the fourth-largest chain.
On the other side, Subway’s U.S. system sales declined by 2% last year as the chain’s sales fell to $10.2 billion, pushing it out of the top five for the first time in nearly two decades—it ranks No. 6, behind Burger King. The sandwich giant’s franchisees closed nearly 1,000 locations last year, the second straight year Subway has closed about 1,000 locations.
It now operates fewer than 24,000 U.S. restaurants, down 13% since 2015.
Sales also declined 0.6% at Pizza Hut, which shrunk by 176 locations last year to 7,306 restaurants. The Plano,
Texas-based chain, which years ago ceded its status as the country’s largest pizza concept to Domino’s, ended the year with $5.6 billion in sales, narrowly maintaining the No. 11 spot over Chipotle.
And Applebee’s, which saw system sales fall by 3% in 2019 to $4.1 billion, lost its status as the largest casual-dining restaurant to Olive Garden, where sales rose 5.3%, to $4.3 billion.
The top 20 highest-grossing restaurant chains
| Rank | Chain name | 2019 U.S. sales ($000,000) | YOY sales change % | 2019 U.S. units | 2019 AUV ($000) |
|---|---|---|---|---|---|
| 1 | McDonald's | $40,413 | 5% | 13,846 | $2,912 |
| 2 | Starbucks | $21,380* | 9% | 15,049 | $1,440* |
| 3 | Chick-fil-A | $11,320* | 13% | 2,470 | $4,695* |
| 4 | Taco Bell | $11,293 | 9% | 6,766 | $1,690 |
| 5 | Burger King | $10,204 | 3% | 7,346 | $1,390 |
| 6 | Subway | $10,200 | -2% | 23,801 | $420 |
| 7 | Wendy's | $9,763 | 4% | 5,852 | $1,684 |
| 8 | Dunkin' | $9,229 | 5% | 9,630 | $970 |
| 9 | Domino's | $7,044 | 7% | 6,126 | $1,175 |
| 10 | Panera Bread | $5,890* | 4% | 2,160 | $2,770* |
| 11 | Pizza Hut | $5,558 | 1% | 7,306 | $750 |
| 12 | Chipotle Mexican Grill | $5,509 | 15% | 2,584 | $2,221 |
| 13 | Sonic Drive-In | $4,687 | 5% | 3,526 | $1,320 |
| 14 | KFC | $4,546 | 3% | 4,065 | $1,117 |
| 15 | Olive Garden | $4,287 | 5% | 866 | $4,980 |
| 16 | Applebee's | $4,086 | -3% | 1,665 | $2,435 |
| 17 | Panda Express | $3,947 | 12% | 2,209 | $1,888 |
| 18 | Arby's | $3,885 | 2% | 3,359 | $1,183 |
| 19 | Popeyes Louisiana Kitchen | $3,812 | 18% | 2,476 | $1,580 |
| 20 | Little Caesars | $3,811* | 3% | 4,237 | $895* |
Source: Technomic Top 500 Chain Restaurant Report; *Technomic estimate
Learn more about Technomic’s Top 500.
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