More Consumers Pulling Up to Window 2

Published in CSP Daily News

Surprising new entries help boost drive-thru profits

PORT WASHINGTON, N.Y. -- The drive-thru didn't start among burger chains--nor will it stay there. McDonald's Ray Kroc borrowed the idea from a Fotomat, and now designer coffee brands, fast-casual chains and convenience stores are finding success with drive-thrus, driving sales up 3% in 2011.

After dropping 1% in recession-heavy 2009, drive-thru sales have been on the rise for the past two years, according to research firm The NPD Group. Sales increased 2% in 2010. Last year, approximately 12.4 billion consumers visited a fast-food drive-thru, a 2% increase over 2010, NPD says.

"For the consumer, it's all about time and convenience, said Bonnie Riggs, restaurant industry analyst for the Port Washington, N.Y.-based research firm. "But for the restaurant, it's also about the bottom line."

One surprising entry into the drive-thru format, Panera Bread is now building them into 20% to 30% of all new stores, reported USA Today, and half of those drive-thru sales are incremental. The drive-thrus are meant to offer a convenience--particularly to moms with kids in tow.

"Drive-thrus aren't bad. What's bad is doing them poorly in a mechanized way with processed food," Panera founder and co-CEO Ron Schaich told the newspaper. "I'm all for giving people access to Panera's good food--not limiting it."

By the end of the year, approximately 200 of the more than 1,500 Panera locations will have drive-thrus offering the entire menu.

Meanwhile, after its first foray into drive-thru stores in 1994, Starbucks has opened nearly 2,500 drive-thru locations domestically. Sister brand Seattle's Best recently opened its own drive-thru concept with never-before-seen coffee beverages, fresh-baked foods and car-friendly sandwiches and snacks (see Related Content below for previous CSP Daily News coverage).

C-stores have had a volatile relationship with drive-thrus. Many retailers try them out only to face an impasse determining just how much of the store to offer while keeping service quick and efficient. NACS estimates "a few hundred" c-stores offer drive-thru service, spokesperson Jeff Lenard told USA Today.

Lenard pointed to Amarillo, Texas-based Pak-A-Sak as a success story for drive-thrus in the industry. The company's newest Pak-A-Sak Express locations allow customers to purchase any in-store items through the drive-thru.

"Drive-thru windows are our big thing now," Brian McKee, co-owner and vice president of merchandising, told CSP. Pak-A-Sak acquired two buildings that were originally built as Starbucks. As customers queue up in the drive-thru lane, they can see the store's selection of packaged beverages through large glass windows. McKee says 67% of sales at the Express locations are made at the drive-thrus.

Framingham, Mass.-based convenience retailer Cumberland Farms has also been testing drive-thru (see Related Content below).