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Chick-fil-A isn't just the fastest growing chain, it's poised for acceleration

7 months ago by Joshua Fruhlinger in Markets

Chicken is hot. According to a study by Nation's Restaurant News, sales growth by chicken chains was up 8.9% last year, making it the fastest-growing segment. Of all the chicken restaurants, Chick-Fil-A ($PRIV_CHICKFILA) led the segment with $10.5 billion in sales.

That put Chick-Fil-A ahead not just of its segment competitors, but it also put it ahead of Wendy's, Burger King, Taco Bell, and Subway, making it the United States' third-largest chain in terms of sales. It's now behind only McDonald's and Starbucks.

Chick-Fil-A is doubling down on its recent success. It opened 129 stores in the past year along with a 16.7% growth in sales, a clear indication that the chain's growth path is not nearly complete.

Nation's Restaurant News estimates per-unit sales for Chick-Fil-A at $4.6 million, up 4.6% from the previous year. That means that given its current pattern, rapid retail footprint growth is a critical lever for the chain's continued success.

Chick-Fil-A store locations closely mirror population centers, with noticeable growth in the past 12 months in more underserved areas. By using a heatmap to illustrate where the chain may launch locations next, it becomes clear that Chick-Fil-A has a lot of room to grow.

In the southwest, for instance, Chick-Fil-A store density per population of 1,000 is rated as "very sparse". This area includes one of the most-active fast-food-buying populations with heavy car use and dense population.

Foot traffic on pace

America's consumers are ready, too. Not only is there room for footprint expansion, but foot traffic is on a steady growth path. Using Facebook "Were Here" data over time, we can see how many people are posting selfies, status updates, and check-ins at Chick-Fil-A locations. Since 2017, Were Here count for Chick-Fil-A has grown from 5.3 million to 7.6 million.

This foot-traffic trend compares favorably to those of Burger King and McDonalds, both of which are seeing slowing trends when it comes to Were Here counts.

Workforce expansion

If Chick-Fil-A expects to expand its presence with customers, it will need to have a workforce in place to both manage the brand's expansion, but also operate the new restaurants. On the corpoate level at the very least, Chick-Fil-A corporate openings have more than doublied in the past year alone.

As for extant Chick-Fil-A employees who are leading the charge from corporate strategy to in-store staff, LinkedIn ($NASDAQ:MSFT) data over time shows a growing workforce of more than 25,000 peoplle calling the company their current employer.

High expectations

Chick-Fil-A's expansion, while it may look on the surface as a trend that is destined for a cool-off period, appears to be in its early stages based on headroom in our data. Store locations show an underserved market, foot traffic trends show steady demand, and a growing labor base all point to acceleration.

About the data

Thinknum tracks companies using information they post online - jobs, social and web traffic, product sales and app ratings - and creates data sets that measure factors like hiring, revenue and foot traffic. Data sets may not be fully comprehensive (they only account for what is available on the web), but they can be used to gauge performance factors like staffing and sales.

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Joshua Fruhlinger

Joshua has been writing about technology, lifestyle, and business for over 20 years. He's one of the original writers and editors for Engadget, and still writes a...

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