Overview:

The first half of 2025 continued to spotlight the power of perceived value in the restaurant industry. With people saving more and spending carefully because of inflation and high borrowing costs, restaurants offered clear value, both in price and experience did well. Those that didn’t meet what customers expected saw fewer visitors and lower sales.

Perhaps the key brand that displays this trend the most is Sweetgreen, where the price of the salad bowl is starting to measure up to the consumer’s expectations – they have made corrections to increase portion sizes in an effort to improve guest traffic.

We found this article from Restaurant Dive very insightful, and we’re seeing the same trend among our clients who deliver strong value for their menu price points. The piece highlights that in the first half of 2025, customer perception of value has become the biggest factor in whether they choose to dine out.

• Chili’s was the standout, achieving a 23% same-store sales gain, fueled by value-driven promotions, operational investments (e.g., TurboChef ovens), and traffic growth.
• Taco Bell (+4%) leveraged an aggressive value strategy, menu innovation, and loyalty program growth to sustain momentum.
• Potbelly (+3%) benefitted from positive traffic trends and new unit expansion, outperforming the fast-casual segment.
• McDonalds (U.S.) (+2.5%) stabilized growth through menu innovation, value platforms, and loyalty programs.
• Applebee’s, Dominos, Papa Johns, Burger King, and Olive Garden also delivered positive results by combining pricing alignment, operational improvements, and menu or loyalty enhancements.

• Sweetgreen (-7.6%) saw declining traffic as customers questioned the value vs. price of its offerings.
• Chipotle (-4%) faced weaker transactions despite higher average checks, highlighting gaps in perceived value.

2025 has seen stronger sales performance for Full Service and Fine Dining concepts compared to QSR and Fast Casual.

Consumers have shown some spending fatigue for the ‘bowl concepts’ and have generally opted to allocate more spend to the restaurant experience which is only at a slightly higher price point.

Denny’s leads the top 10 for the week ending Friday, 15 August 2025.

• NRA: Economic Indicators – Same-store sales and customer traffic – Link
• 8 restaurant trends to watch in 2025 – Link
• Chipotle’s Comparable Sales Dropped Year Over Year… – Link
• Toast Data: Reservation trends shift to slower days and early dinners – Link
• WSJ – Are value meals worth it for restaurants? – Link

Week Ending | 15/08/2025

The last 30-day performance had an average of 1.9% for the Top 10.

The top 10 is made up of mostly Franchisor entities, which have higher multiples than company owned concepts. Consensus revenue growth forecasts estimate ~12.5% growth into 2025. The growth guidance is attributable to store growth and price increases.

Restaurant businesses are generally valued on multiples of their revenue or EBITDA, depending on their capital structure, growth potential, and franchise model. For example, a McDonald’s franchise has a higher revenue multiple than a company-owned restaurant chain like Shake Shack.
Here are some of the factors that affect restaurant valuation multiples:

• Capital structure: Businesses with less debt and more equity tend to have higher valuation multiples.
• Growth potential: Businesses with high growth potential tend to have higher valuation multiples.
• Franchise model: Franchise businesses tend to have higher valuation multiples than company-owned businesses.