Downward angle icon Downward angle icon. Darden Restaurants CEO Rick Cardenas said Chili’s and Applebee’s seem to have had some success competing with fast-food chains. Jeffrey Greenberg/Education Images/Universal Images Group via Getty Images Darden Restaurants CEO Rick Cardenas said there’s been a small shift from fast food to casual dining. American fast-food consumers have expressed frustration with rising prices. Some casual chains are now offering discounted combo plans to attract customers looking for a better deal.
Customers who are fed up with ever-increasing prices at fast-food restaurants are taking action and may turn to places like Chili’s and Applebee’s instead.
“We’re excited about this opportunity,” Rick Cardenas, CEO of Darden Restaurants, said during the company’s quarterly earnings call on Thursday. Darden is the parent company of casual dining chains such as Olive Garden, Longhorn Steakhouse and Yard House, as well as fine-dining chains such as Ruth’s Chris Steakhouse and The Capital Grille.
Cardenas said on the conference call that there has been a “little bit of a shift” from fast-food restaurants to competing in the casual-dining space, according to CNBC. While Darden hasn’t necessarily felt the pull yet, the parent company of Chili’s and Applebee’s is leaning toward getting into fast food, CNBC reported.
Business Insider’s Erin McDowell previously reported that casual dining chains like Chili’s and Applebee’s have introduced discount combo deals that compete with the value meals customers are accustomed to at places like McDonald’s and Burger King.
In April, Chili’s launched its Big Smasher Burger, which uses nearly the same ingredients as McDonald’s Big Mac.
“We know our customers are surprised by the increase in fast food prices when the actual quantity or quality of our fast food combo menu items has remained largely unchanged,” Chiliz CMO George Felix told Restaurant Business Magazine in a statement at the time, adding that Chiliz’s combo menu items “really offer better value than any drive-thru.”
Fast food prices have risen in recent years, and the percentage increase is abnormally high.
Industry analysts previously told BI’s Grace Dean that fast-food prices had been rising about 2% annually, but that in 2022 and 2023, some restaurants will see double-digit increases.
Fast-food customers told BI they are aggressively saving money as restaurant prices rise, and some say they would rather pay a little more and sit down and eat at places like Chili’s or Applebee’s rather than using the drive-thru.
Meanwhile, fast food companies such as McDonald’s are introducing limited-time deals for customers feeling the effects of inflation.
