hake Shack's IPO. The fried chicken sandwich explosion. Peet's acquisition of Intelligentsia and Stumptown. Waves of food poisoning at Chipotle. McDonald's all-day breakfast. The minimum wage fight. This is the time of year to look back on the year's biggest stories and make dubious predictions about the trends that will define 2016. But this year, those stories clustered around a single topic: chain restaurants. There's only one prediction to make: 2015 proved that while particular massive companies are in crisis, chains are the future of American dining.
At first glance, this idea seems both obvious and regressive. Isn't our past fast food? And our present? But for a long time, the elite of the restaurant industry placed themselves far away from the bland suburban chains, which seemed both unassailable and irrelevant. Now, there's a vacuum at the center of our food culture. Or at least the possibility of one, a slipping and softening where many see opportunity. Family-friendly casual dining and fast food chains, most notably McDonald's, are weakening, and across the board more Americans are demanding higher quality in their food — and are willing to pay more for it.
Over the past half-century, the real growth was in convenience foods. We shop at farmers markets, but we live in chains.
And when I say food culture, I do mean culture. Mid-century revivalists and enthusiasts like Alice Waters, James Beard, Julia Child, Craig Claiborne and countless others transformed our restaurant and, selectively, home cooking culture. But by the numbers, during those same years the real growth was in factory farms, convenience foods, and national chains. We shop at farmers markets, but we live in chains.
So what if chain restaurants were just — good? Good to eat in, good for workers, good for the environment, virtuous and tasty all at once? What if our lumbering titans could be easily replaced with craft-ish upstarts? What nothing changed at all about our culture except that everything was slightly less bad?
That high-minded and comforting notion is the core mission of many of the biggest new players in the restaurant chain world. Bringing thoughtfulness and respect to quick-serve restaurant meals — the vast majority of American restaurant meals — is a development so obvious and necessary it's shocking it took so long. But packaging this chain-infrastructure upgrade as a solution to everything from the environmental disaster of factory farming to our public dietary health crisis (as these restaurants want to do) — not so much. The neo-chains' do-gooder messaging obscures the real transformation they're undertaking. Because the real story is that 2015 was the year that corporate fast food culture and the independent restaurant world truly collided, all of them chasing the answer to the question: What's next? Which, more than anything else, is really a question of: Will it scale?
BURGERS AND FRIED CHICKEN
When the country is blanketed with the next wave of chains, we'll be able to trace it all back to Shake Shack. In January of this year, the company launched an immensely successful initial public offering. While share values have wobbled a bit over the course of the year and the current valuation is a little nuts, the company has made founder and New York restaurateur Danny Meyer a very very wealthy person, and the brand's pace of expansion shows no sign of slowing. Growing from a humble single location to an international phenomenon is, of course, a proud American tradition. The Shake Shack model is not inherently new; rather, it's a potent mix of several major cultural trends, including consumer concern over the quality of mass-produced food, and a growing sophistication among diners for both taste and atmosphere in even the most humble of restaurants. A Shake Shack opening in a new city, or even a new neighborhood is still, for now, a major event.
McDonald's is hardly alone in attempting to seduce the rising generation of consumers with gimmicks like mason jars and selfies.
Compare this to McDonald's past few years. The new millennium has been one long media drubbing for the chain, starting with Rolling Stone's serialization of Eric Scholsser's damning investigation into McDonald's and the rest the fast food industry in 1998, which later became his groundbreaking book Fast Food Nation. In 2015, the chain announced plans to close hundreds of stores in the U.S. and China and to focus their model more aggressively on franchising, though their year kicked off with complaints over the menu from their current franchisees. McDonald's is hardly alone in struggling to seduce the rising generation of consumers with failed gimmicks from mason jars to selfies, but as the synecdoche of the current chain food industrial complex, not to mention its largest player, the struggles of the Golden Arches are especially worth noting. Their most recent strategy shift drops obvious millennial-chasing, and instead plays to one of McDonald's biggest strengths: breakfast. Their previously morning-only breakfast menu accounted for an impressive 25% of all sales, and in September McDonald's announced the launch of all-day breakfast. The change-over threatens to further stress the chain's relationship with franchise owners, who shouldered the cost of necessary upgrades, but after posting a 4% gain in sales in the third quarter of the year, both corporate headquarters and investors are optimistic about the company's turnaround. Perhaps abundant McMuffins will indeed be their salvation, but as Eater's Daniela Galarza explained earlier this year, the chain has many more problems to solve to fully maintain their relevance.
The divide between old and new models of fast food were maybe illustrated most elegantly at this year's SXSW conference. McDonald's sponsored the festival for the first time, but initially refused to pay artists performing on their stage, reversing course only after they were publicly shamed. Meanwhile, Momofuku's mastermind and empire-builder David Chang used his keynote address for SXSW Interactive's new food track as an opportunity to announce the launch of his own fast food concept, Fuku, which would be slinging fried chicken sandwiches he compared to Chick-Fil-A. Chang is hardly blazing a new trail as a chef moving into fast food, but his high profile combined with the simplicity of the concept — chicken, deliciously fried and put on bread — made Fuku a major new player in the fancy fast food category, especially because the first location opened only a few months after his announcement. Chang was picking up something in the air: overall, 2015 was the year of the fried chicken explosion, as chronicled by Eater's Hillary Dixler, who dove into the chicken-fueled mania behind Fuku, Shake Shack (who have their own recently introduced fried chicken sandwich), and the many, many smaller chains and restaurants discovering the wonders of battering and frying.
If the main problem with fast food is a low deliciousness-to-calorie ratio, these new concepts solve it.
Certainly there are few things more delicious, or more American, than burgers and fried chicken. If the main problem with fast food is a low deliciousness-to-calorie ratio, new concepts like Shake Shack and Fuku (and Chicken Shack, Umami Burger, Smashburger, and many more) most definitely solve the problem. Their ingredients are better, their recipes are more thoughtful, and their restaurants are more enjoyable to visit.
There also may be nothing more American than puritanical handwringing over physically pleasurable experiences, so all of these chains have gone out of their way to tout the more humane treatment of the animals they serve, the local-mindedness of their ingredient sourcing, and their higher labor standards. This obscures the fact that they are, essentially, in the same business as McDonald's and Chick Fil-A: they sell delicious, craveable calorie bombs. Certainly, the simple and potent pleasure of a drive-thru hamburger should not be limited to ones made of factory beef, prepared by people paid so poorly that many rely on public assistance. These new concepts aim to satisfy those cravings with more sophisticated menu items served by better-paid workers.
But what if the meat, and the calorie bombs, weren't part of the quick-serve experience at all? Tasty burgers and fried chicken for all sounds pretty great. But you know what else sounds great? A giant, delicious plate of vegetables served with the same speed and emphasis on pleasure that's usually given to fried, meaty dishes. 2015 was marked by another group of new-school chains who aim to upend supply problems and by de-emphasizing the meat completely. It's not just out of the goodness of their hearts: adding the adjective "healthy" before the phrase "fast food" makes investors and professional food scolds alike swoon with delight. Whoever cracks the tasty-quick-healthy food puzzle stands to reap massive rewards, both PR and monetary. Salad specialists Sweetgreen has garnered a great quantity of investment money, as has vegetable-focused chain Tender Greens (notably, Shake Shack's Danny Meyer has invested in both). California-based Lyfe Kitchen has had major expansion plans in the works since 2011. The growth of any such chain almost guarantees major press coverage: veganism evangelist Mark Bittman sampled Lyfe's pre-opening offerings in 2013, and the New Yorker's food issue this year covered healthy fast food with a focus on Sweetgreen.
Adding the adjective "healthy" before the phrase "fast food" makes investors and food scolds alike swoon.
While many of these chains focus on communicating their message through not just high-quality vegetables but also upscale, Pinterest-worthy decor, 2015's biggest entrant into the virtuous fast food scene is a hole-in-the-wall veggie burger joint in the East Village. Superiority Burger, launched by former Del Posto pastry chef Brooks Headley, is not a chain (yet), but serves a meatless burger that Eater New York restaurant critic Ryan Sutton noted was best viewed as "a more refined and more delicious substitute for the McDonald's quarter pounder." But the Superiority Burger's potential goes beyond offering a tasty meat substitute. In many ways, Headley's project illuminates how thin the line truly is between efficient chain and scrappy punk rock minimalism. In his year-end roundup, New York Times critic Pete Wells (who earlier in the year bestowed two stars on the 300-square-foot shop) notes that Superiority Burger's revolutionary impact lies in Headley's talent for "stripping the dining experience to its core values," citing both the friendly and engaged service and the kitchen's sheer creativity. In some ways, this turn toward simple food concepts, turned out with a sophisticated kind of deliciousness, is a no-bullshit, anti-elitist reaction to the excesses of high-end restaurant culture. There's an idea that counter service and paper boats, rather than white tablecloths and fine china, are somehow more real.
Headley might come to his minimalism honestly, but it's a language that is being broadcast in a much more targeted way by millennial-chasing virtue mongers, and the message is working. Greens-focused restaurants have developed a design lexicon of chalkboard menus, proudly displayed ingredients, open kitchens and perhaps some microgreens on display alongside long lists of farmer-suppliers. Look: Real food! Perhaps the neatest trick all of these concepts play is to transform humble vegetables into hip, luxury products — they're markers of personal authenticity, rather than crunchy punishment.
New wave chains are growing increasingly adept at commodifying our culture's ever-expanding obsession with the performative aspects of dining. Health-focused concepts transformed vegetables into aspiration, but that same elitist tinge has always been part of the fabric of coffee chains. Eater's Vince Dixon recently broke down the persistent correlation between Starbucks density and the whiteness and wealth of neighborhoods. And if traditional fast food chains are vulnerable to aspirational challengers with Instagram-friendly lighting, Starbucks may be even more so.
These coffee chains' aspirational lifestyle vibe is both made possible by and set in opposition to Starbucks.
And so, in the craft coffee world, those challengers are coming. San Francisco-based chain Blue Bottle merged with Tartine Bread and announced massive VC-fueled expansion plans (though this year also saw that partnership fizzle). More dramatically, two of the country's highest-profile independent roasters, Stumptown and Intelligentsia, were separately acquired by Starbucks competitor Peet's. In addition to ostensibly better sourcing and higher product quality, all of these coffee chains offer their customers an impeccably designed, aspirational lifestyle vibe, one both made possible by and set in opposition to the look and feel of Starbucks. The chain is fighting back and trying to beat third wave coffee at its own game, with fancified locations and limited releases (or more bewilderingly, failed racial dialogues). But it's looking down a future where it'll be directly challenged by some of the originators of that third-wave style — or at least, the parent companies who acquired them wholesale.
Of course, the same qualities that make a restaurant aspirational — perceived luxury and cleanliness, quality ingredients, relative rarity, good Instagram light — diminish in value as a concept grows. Intimacy (or at least uniqueness) is an essential part of luxury. Will Stumptown or Intelligentsia or Blue Bottle still feel like destinations if their locations blanket a city, or expand to the suburbs? Starbucks used to feel like an event, too. And a drop in perceived luxury is only the beginning of the woes of growth.
For a year clogged with new concepts aspiring to become "The Chipotle of X," hoping to replicate the burrito juggernaut's virtuous reputation as well as its scale, Chipotle itself has had it rough, the chain's year marked by major incidents of supply-chain breakdowns and food poisoning. First there was the great carnitas shortage, sparked when a pork supplier failed to meet unspecified "responsibly raised" standards. In the second half of the year, the chain was hammered with outbreaks of foodborne illness that quickly became a public health disaster (as well as a PR one). 43 stores were closed due to E. coli, and three different locations had major norovirus outbreaks. Steve Ells, the company's outspoken CEO, is currently making the obligatory public apology rounds, promising to transform the chain back into "the safest place to eat," only to have the CDC confirm five new cases of E. coli originating from the chain. That's about as far from aspirational as a chain's identity can get.
New-school chains get more attention for their messaging about food quality than they do for their worker pay.
"Safety" is, of course, a key word for another reason. Privileged Americans have a proud history of caring more about the integrity of their food than of the workers who produce it, ever since Upton Sinclair wrote The Jungle. New-school chains get more attention for their messaging about food quality than they do for their worker pay, so that's what they focus on. It took nationwide activism over the minimum wage to bring the issue of fast food's low worker quality of life to the national stage. The good news is: in the wake of the year's landmark wage protests, several of the country's major cities (who happen to be largely the restaurant standard-bearers) passed legislation bringing their local minimum wages up to $15 over the next decade.
Rising wages will also present a challenge to existing chains' business models, which are predicated on an abundance of cheap, commodity labor. In March, McDonald's joined several other chains (through industry trade groups like the International Franchise Association) in suing the city of Seattle over the city's planned $15 minimum wage, though their chances in court are not looking good.
This wage rise also upends the business models of full-service restaurants, who run on notoriously tight margins. Already, restauranteurs are searching for new labor solutions. Shake Shack founder Danny Meyer's landmark decision to ban tipping at his full-service New York restaurants is already ripping through the city's dining scene. Another option for restaurateurs is to forgo full service completely. Charles Bililies, the owner of San Francisco "fine-casual" restaurant Souvla, told Eater in July that he chose that hybrid model, which requires a smaller labor force, in response to a rising minimum wage. In fact, the most nimble sector of the market might be newer chains, whose business models are built from the ground up to accommodate the new labor cost reality. Notably, rather than fighting the laws, Shake Shack is raising prices to help boost employee pay in advance of minimum wage changes.
Say these new-school chains actually achieve their goals of massive profit while paying workers a living wage, serving healthy food efficiently, dismantling the factory meat infrastructure and making everyday American food a bit tastier. Is that utopia? The impact of chain restaurants isn't just felt in the poor quality of their ingredients or the inadequate wages they pay their workers — even the best chain is, still, a chain. And by their very nature, chains flatten culture. Many of America's great independent roadside eateries were decimated by the brutal efficiency of fast food. Renewed interest in local foodways have helped preserve what's left, perhaps, but what happens if chain restaurants become more sophisticated and more desirable than the few independent operators who remain? There are plenty of cheap restaurants, ranging from perfectly fine to great, that will never be profiled by the Southern Foodways Alliance, win James Beard America's Classics Awards, or named icons of their cities, but that nevertheless enliven their local dining cultures. This is especially true of family restaurants, small local spots, and restaurants run by recent immigrants. As chain dining becomes more sophisticated and more diverse, it's possible those operations will make running an affordable, everyday, neighborhood restaurant even harder than it currently is.
A global restaurant culture is forming, at least within elite cities. Like everything else, it's the internet's fault.
Certainly, consumers' tastes are trend-focused. Like everything else, it's the internet's fault. At every price point, a global restaurant culture is forming, at least within elite cities. Everything from the World's 50 Best list to Instagram has been blamed for an eerie similarity between many of the world's high-end restaurants, but the phenomenon isn't limited to elite dining rooms. The internet as an engine for our largely visual obsession with food means trends move quickly and frictionlessly across the country, whether it's Edison lightbulbs or fancy toast. Independent restaurants can sometimes feel like franchises of the same concept, as more and more diners expect their city or town to master the hot dishes of other cities or towns, to offer the uni paninis and kimchi tacos they see on friends' Instagrams. No one can satisfy that desire for a FOMO dining culture better than a straight-up chain.
This is not a transformation that aims to stop at the boundaries of the world's most expensive urban centers, either. In that SXSW keynote, David Chang said he specifically wanted to use Fuku as a vehicle to raise the quality of food in the suburbs. It is possible, of course, that a new wind will blow through the industry before the new crop of brands expand their reach that far. Ten years ago, when high-end US chefs sought to reach wider audiences, they didn't open cheap, scaleable restaurants. Instead, they launched supermarket products, or partnered with existing chains. As chronicled in 2006's United States of Arugula, chefs interested in broadening their reach turned to branded frozen dinners (Wolfgang Puck), launched supermarket spice blends (Emeril Lagasse), or served as a spokesperson for a healthier sandwich from Burger King (Rick Bayless). Frozen food is now another failing sector of the food landscape; Bayless now has locations of his own new-wave chain Tortas Frontera at O'Hare airport and the University of Pennsylvania (college campuses being, of course, another chain stronghold).
At the moment, however, the rise of fancy chains seems to result from a near-irresistible blend of cultural forces. The optimist might herald this as the transformation of our broken food system by a generation fed up with industrial food and bland cooking. The pessimist might point out that nothing says "death of the middle class" like the concurrent rise of fancy chains and ticketed tasting menus. The millennial-hater would characterize our generation's enthusiasm for chain dining as an immature affectation, since McDonald's was the first restaurant so many of us first experienced growing up. All of these factors are definitely at play, a potent mix of opportunity and economic upheaval and generational shift. Regardless of the narrative, the fact that more Americans are eating out regularly and are more anxious about the quality of their food creates the need for good, quick, everyday options. The stability and predictability of chain profits will allow big restaurant groups to take risks on mid-range and high-end restaurants — which is another reason why so many chefs are interested in launching scalable concepts. But chain dining is growing ever more relevant at the exact same time.
It's hard to say what comes next. For the first half of 2015, I lived in Austin, Texas, a city not unique in the fact that chefs from fine dining backgrounds are expanding their footprint to (and looking for a revenue stream in) quick-serve, fast-casual spots. From hipster-friendly Thai food (Paul Qui & Thai Changthong's Thai Kun) to fancy pollo al carbon (Rene Ortiz and Laura Sawicki's Fresa's), the city is full of places to get an affordable meal that still ticks off all the markers of hip food culture: local, ethical, beautiful. And yet what was the most hotly anticipated opening of the year? A Shake Shack. The story is the same in my new neighborhood in Los Angeles, Culver City: the entire downtown is blanketed with fast-casual staples and upstarts, from Chipotle to Tender Greens to Pieology to a kebab concept called Grilliant. The LYFE Kitchen touted in 2013 by Mark Bittman is drowning in competition. The major question at this point is not just whether any of these concepts will scale, but which ones. And what it will mean when they do.