While a number of chain restaurants like Joe’s Crab Shack, Bob Evans, and Logan’s Roadhouse have closed locations in recent years, there’s still a wealth of options for people looking to dine out or grab a quick cup of java. But that’s not necessarily a good thing.
Dunkin’ Donuts CEO Nigel Travis tells Business Insider that there are simply too many restaurants in the U.S. for all of them to be successful.
“The country is probably over-restauranted,” Travis said, adding that not many categories are actually growing.
More Stores, Fewer Customers
Part of the problem with the restaurant industry hinges on the fact that many of the chains with a large number of stores have opened even more locations.
Dunkin’ Donuts has 8,828 locations in 2016, and that’s after the company added 397 stores since 2015, according to QSR. Since 2013, Dunkin’ has added around 1,000 stores in the U.S., in spite of this alleged over-saturation.
Business Insider reports that Starbucks and Darden Restaurants — parent company to Olive Garden — have each expressed concerns about the glut of restaurants available to consumers.
At the same time — just like Dunkin’ — both Starbucks and Olive Garden have continued to expand. Starbucks added 651 locations between 2015 and 2016 and is nearing the size of McDonald’s in the U.S. with 13,172 stores. Olive Garden now operates more than 800 locations.
Whatever the reason, Americans just aren’t dining out as frequently as they used to. According to industry tracker TDn2K, customer traffic at U.S. restaurants has been declining for nearly two years.