When preparing to launch an eating establishment, you importantly think through your business strategy with consideration to profits — as well as the customer behavior trends. To that end, it is crucial to know the different types of restaurants and which restaurant categories may be proper for yours.
According to the National Restaurant Association, more than 1 million dining establishments are open in the US, with many types to select from. 2019 observed Americans eating out 5.9 nights per week on average. While this has decreased some due to the coronavirus pandemic, the amount of delivery orders has not slowed down. Among a myriad of options, the question is, what restaurant concept should you choose? We list down the most popular ones in the restaurant industry that should help with your bottom line.
The 8 different types of restaurants
1. QSR/Fast food restaurants
Definition
Fast food restaurants (or QSR - quick service restaurants) serve food packaged via a counter service or drive-throughs so that customers can eat on the go. Fast food chains or franchises with a worldwide or national presence usually fall into this type of restaurant. Doordash’s 2022 report revealed that fast food items are in the top 3 types of ordered food in the country.
Main characteristics
Service style: Drive-through or counter service
Menu: Standardized with a fixed price in various franchises. Menu options in fast food establishments include fries, sandwiches, burgers, and soft drinks.
Interior: Casual dining spaces that do not require much effort to clean
Price: $
Why it is popular and profitable
- A quick service restaurant boasts low price points and convenience.
- Fast food tends to evoke nostalgia, say reminding family style road trips.
- Involve a sense of familiarity since customers know the food served.
- These types of restaurants have high-profit margins (between 6% - 9%). That is mainly because of soft drink sales and lower costs for labor, facilities, and ingredients.
Examples
- McDonald's
- Burger King
- Taco Bell
- KFC
- Dairy Queen
- A&W
- Little Caesars
- Domino’s
2. Casual dining restaurants
Image source: Frannie & The Fox
Definition
The casual dining model is a full-service restaurant for patrons who expect a slightly more elevated dining experience without breaking the bank. There are usually promotions such as coupon campaigns and happy hour deals here. This type of restaurant can be a local independent one or a larger franchise. It is also worth mentioning that the fanciness of casual dining restaurants falls between fast casual and fine dining.
Main characteristics
Service style: Full-service restaurants (sit-down restaurants with table service)
Menu: Medium-quality food items, large portions. Guests dining at casual dining restaurants could find practically anything, including meatballs, spaghetti, and waffles.
Interior: Thematic decoration, laid-back atmosphere, comfortable seating
Price: $$
Why it is popular and profitable
- These types of restaurants serve food relatively quickly while allowing customers to sit down and appreciate table service.
- Adhere to the need for special occasions or weeknight meals.
- Considering high price points compared with fast food restaurants, casual dining eateries can make more money on each sale.
- Able to serve more guests at a time by running in larger spaces.
- Being more of a destination restaurant for special occasions, it can bank on diners spending more on desserts and beverages, increasing profits.
Examples
- Applebee’s
- Olive Garden
- Outback Steakhouse
- T.G.I. Friday’s
- P.F. Chang’s China Bistro
- Cheesecake Factory.
- Red Lobster
3. Fast casual restaurants
Image source: Tallulah’s Taqueria
Definition
Fast casual restaurants are a hybrid of casual dining and fast food that experts project to be poised for continued growth. Fast casual types of restaurants often offer an upscale menu in comparison with fast food eateries, with fresher or healthier ingredients and concurrently give the same quick turnaround. They have a counter-service model like fast food restaurants. While several fast-casual establishments may provide limited table service by delivering orders, servers are not available. Besides, unlike fast food type of restaurant, they do not stay open late at night or have a drive-through.
Main characteristics
Service style: Counter service or table service (not full table service)
Menu: Customizable meal options. Think customized salads, better quality burgers, or superfood-filled smoothie bowls.
Interior: Upscale atmosphere compared with fast food
Why it is popular and profitable
- Healthier than fast food and low-priced compared with casual dining types of restaurants.
- The marriage between convenience and quality.
- Decrease labor costs for fast casual owners as much of the dish preparation can be done beforehand.
- Deliver a hybrid customer experience with on-premise and off-premise dining options.
Examples
- Chipotle Mexican Grill
- Sweetgreen
- Panera Bread
4. Fine dining restaurant
Image source: Le Bernardin
Definition
Fine dining restaurants offer guests an upscale meal experience usually comprising some courses like entrees, appetizers, main courses, and desserts. Many people choose fine dining establishments when celebrating something special, for example, a birthday, wedding, or new job promotion. This type of restaurant can run as a single location to boost its sophisticated image or a franchise for more extensive attractiveness.
Main characteristics
Service style: Full table service with an emphasis on the importance of etiquette
Menu: Expensive, exclusive, quality food items at a fixed price. Besides, menus at a fine dining restaurant may routinely evolve for culinary innovation and seasonality representation.
Interior: Elegant decoration, for instance, with beautiful lighting and meticulously curated music
Price: $$$-$$$$
Why it is popular and profitable
The fine dining experience is representative of the best. Operating these types of restaurants makes you part of a time-honored tradition.
Examples
- The Capital Grille
- Circa 1886
- The Melting Pot
- Lahaina Grill
- Le Bernardin
- Ruth's Chris Steakhouse
5. Contemporary casual restaurants
Definition
As a new offshoot of the fine dining concept, the contemporary casual restaurant is a popular and profitable type of restaurant that often cater to the young in urban and metropolitan areas that pay more attention to the atmosphere and experience. It features today’s culinary trends such as craft beer and societal concepts like sustainable delivery packaging and locally sourced ingredients. The price range is somewhere between fine and casual dining.
Main characteristics
Service style: Full-service restaurant, QR code menus, mobile ordering and payment
Menu: Medium to high-quality food, trendy dishes, fusion cuisine, farm-to-table, diet-inclusive options
Interior: Outstanding decoration that the Instagram generation likes.
Price: $$-$$$
Why it is popular and profitable
- Cater to modern trends, for example, a highly-Instagrammed wine bar.
- A trendy eatery that is still reasonably priced for many guests.
- These destination restaurants allow people to embrace the culture or city around them. For instance, a contemporary casual restaurant may have the experience of being sited in a remodeled building that has been in the town for over 100 years. Lots of guests will visit it just for the experience of the location.
An old Stockholm-based factory was remodeled into a food establishment and meeting space. (Image source: Trendhunter)
Examples
- Iron Hill Brewery
- Earl's Kitchen + Bar
- Seasons 52
6. Cafés and coffee shops
Definition
A café and coffee shop means a food business that focuses on coffee and tea and typically allows patrons to order at the counter. The price points are low to moderate.
Main characteristics
Service style: Counter and/or drive-through service
Menu: Coffee, tea, juices, pastries, small dessert sampling, and easy-to-prepare menu items for lunch or breakfast
Interior: Outdoor seating, fewer tables, unhurried atmosphere
Price: $-$$
Why it is popular and profitable
- Coffee shops serve lots of needs. They can be a leisure spot, a place to work remotely, or somewhere convenient to seize a quick bite.
- Easier to earn customer loyalty.
- The investment cost to start this business is lower than a full-service eatery.
- Do not require as many workers.
- Decoration is often minimal.
- The markup on coffee is considerable (up to 80%), meaning larger profits for your shop.
Examples
- Dunkin' Donuts
- Gloria Jean's
- Starbucks
7. Pop-up restaurants
Image source: Eventbrite
Definition
Pop-ups are temporary, usually mobile restaurants. While the catalyst for the prevalence of the pop-up restaurant model is food trucks (that specialize in items like hot dogs and ice cream), the food truck business has become more stationary. Taking the form of stands, warehouses, tents, etc., pop-up restaurants last for a short time like one day or longer, say a whole season. These restaurant categories may grow into more sizable businesses, sometimes food trucks, bars, or sit-down eateries.
Main characteristics
Service style: Food stand, food truck service, counter service, or full table service
Menu: The menu varies depending on the pop-up restaurant type. Usually small menu
Interior: Temporary seating spaces and easy-to-remove decoration
Price: $$-$$$
Why it is popular and profitable
- Because of its temporary nature, customers do not want to miss out on visiting a new pop-up restaurant before it is gone.
- Overhead is generally low.
- Able to thrive with limited facilities and employees.
- Enable chefs and owners to try out a new restaurant and food concept.
- Able to grow into different types of restaurants.
Examples
- Marigold's
8. Ghost restaurants
Definition
As a new concept in the restaurant industry, the ghost restaurant - a virtual restaurant, generally falls into the delivery-only types of restaurants without a storefront. Please note that there are various business models for your next ghost restaurant, which you can check here.
Main characteristics
Service style: Mobile and online ordering
Menu: Dishes that travel well
Interior: Kitchen
Price: $$
Why it is popular and profitable
- A fantastic option for people who want meals to-go or delivered
- Limited overhead (no dining rooms and parking lots, lower labor costs, etc.), quicker launch, and increased profit margins.
- The food delivery market is anticipated to increase more than 10 times over 10 years to $365 billion from $35 billion/ year.
- Delivery and visibility are optimized by the One2 platform.
- Effective business expansion with One2.
What One2's customers have to say
Examples
- Mr. Beast
- Guy Fieri's Flavortown Kitchen
- Wow Bao
Make the most of popular restaurant types with One2
To launch particular types of restaurants, including new concepts that do not fit within the most popular ones, there is the true turn-key technology system One2 to help you streamline the process - so you can pay attention to the tasty cuisines you serve.
One2 provides everything you need to start and operate a successful food business, including:
- Optimized contactless QR code menus
- Online Ordering, fulfillment, loyalty & rewards
Make your culinary dreams a reality with One2 today.
One2Menu is made for mobile customers.
Offer customers a smooth ordering experience with One2
Related questions
1. Which are other types of restaurants aside from fine dining?
There are some others apart from the quick service/fast food restaurant, the fast-casual restaurant, food trucks, contemporary casual restaurants, etc., mentioned above.
- Family style eateries
- Buffets
- Pubs
- Diners
- Bistros
- Teppanyaki grills that specialize in Japanese cuisine
- Mongolian barbecue
- Destination restaurant
- Ethnic restaurant
- Premium casual
- Tabletop cooking
2. What are common restaurant categorization factors?
- Service type
- Atmosphere
- Price
- Food type served
3. Does One2 provide a free QR code generator?
Yes. It is readily accessible here.
