The Restaurant 2026 Forward View

Each year there are two outstanding restaurant conferences that kickoff that are the best restaurant forward view: the Restaurant Finance and Development Conference in November and the ICR Conference in the following January. I attend both every year.

Last week, ICR and Partner Raphael Gross and team once again provided an excellent experience. After the 2024-2025 period, two slow and difficult years, some attendees had the impression that the presenters said little new (hat tip: R. J. Hottovy, CFA, Placier AI). That is because post Pandemic  consumers act differently as in the past, while many companies largely repeat the same tactics.

IMO, that is because neither company management, analysts, other industry consultants and service providers can’t see through the fog of war quickly. [1]Per my count, there are 25 outside macro influences underway impacting restaurants currently. Some consumer factors cycle in and out so quickly, the best system can’t react report it fast enough.  For some brands, fundamentals reporting is poor[2]. The industry needs to coordinate not to make the same mistakes over and over, that makes the overall environment more difficult for guests, investors, operators, employees, suppliers and industry brands everywhere.

The predominant 2026 outlook reported from both conferences was “cautious optimism”. Several analysts noted hope for federal revenue refunds, which do absolutely flow out from consumers to retailers once received.  Expectation that the strong will remain strong—Chili’s, Olive Garden, Longhorn, Texas Roadhouse, Dutch Bros, Taco Bell (alone in the QSR segment)—is assumed into  the forecast. Overall traffic growth is projected at around 0 to 1%, with average ticket growth up in the 2% plus range. But food commodity and supply chain costs will be again troublesome, especially beef. A 2-3% same  store sales barely will cover inflation.

Thus, margins will be an issue, with ability to take price is constrained. This means to me that non customer facing cost containment will be in focus.  Building and equipment CAPEX and the cost to remodel and build new units is still appx.50% higher than 2019.

If any of this is familiar, it is. These issues are the same since about last 2022.

2026 conference takeaways:

·       None of the traditional fast food QSR operators showed up to present. Not one. We can speculate why, but it likely has to do with sub-par sales and profitability results in 2025. However, Qdoba and Authentic Brands, both fast casual brands did appear. Both have progress underway. Otherwise, many casual dining brands appeared. 

·       Restaurant IPOs in the works: the well performing Fogo de Chao Management Team was again a presenter and again demonstrated its qualifications for a later eventual IPO. It has been posturing for some time.  And Reuters reported that Jersey Mike’s PE firm owner is reviewing interviewing investment banks for a potential later 2026 IPO. Blackstone acquired JM for $8B (with earnout) in 2025, of which the goal for 2026 is to eliminate the earnout. This is a very quick PE offering. 

Very fresh consumer data: restaurants stable month to month Our friend Lisa Miller (founder of LWM Associates, research and marketing consultancy, with Brinker experience) monthly polls consumer attitudes for all of the consumer discretionary space. This includes restaurants.

From November to December, consumer poll results moved three points from green (spending normally) to yellow, 3 points higher, (pausing and more cautious). Fortunately, the red category, stopped spending in total, was flat.

The “better” news for us restaurants is that spending was flat month to month. We’ll take it but of course we need more. See the You Tube link and look for more information on January 28:

The US Economy is Flashing Yellow🚦Consumers Are Hitting Pause.

Web: https://www.lwm-associates.com

[1]   This may be why restaurants follow and copy one another. Best latest example was the fast food discounting war in mid-2024 and 2025.

[2]   Especially franchise brands. Beyond SSS and unit growth and contraction, that is about it.