Toast’s latest report reveals price increases at quick-service restaurants, changing consumer dining preferences, and slight declines in tipping across the U.S.
The U.S. restaurant industry saw several shifts in consumer spending and pricing in Q2 2024, as revealed in Toast’s latest Restaurant Trends Report. Toast, a cloud-based digital platform serving approximately 120,000 restaurant locations, provided insights through an analysis of aggregated data from restaurants across its platform, highlighting trends in pricing, tipping, and consumer preferences.
During Q2 2024, the cost of dining out increased across various food categories at quick-service restaurants (QSRs). For example, the average price for sandwiches and wraps rose by 4.6% year-over-year to $11.26, while burritos and burgers saw similar increases of 4.3% and 4.6%, reaching $10.74 and $11.45, respectively. Fries, a staple side dish, went up by 4.4% to an average price of $6.04. Meanwhile, according to the report, soda prices climbed 4.6% to $3.00.
While these rising costs were consistent across the U.S., there were some regional differences in the most popular menu items. Sandwiches and wraps remained the top choice in the majority of states, but tacos took the lead in California, Nevada, Oregon, and Texas. Bowls were favored in Hawaii, and Utah diners preferred salads. Additionally, consumer spending shifted from dinner and late-night meals to breakfast transactions in 20 major U.S. cities, reflecting a change in dining patterns.
In terms of employee compensation, QSR cashiers in California earned a median hourly wage of $16.98 as of June 2024, as analyzed from same-store data on the Toast platform. However, tipping slightly decreased, with average tips dropping to 18.8%. Full-service restaurant tips were slightly higher at 19.3%, while tips at QSRs dipped to 15.9%, marking a slight shift from previous periods.
The report also shed light on how the cost of specific items has fluctuated. Bowls, burgers, and noodles/ramen were among the most expensive items in Q2 2024. On the other hand, tacos, fries, and hot dogs remained the most affordable options. Despite these relatively lower costs, hot dog sales saw a significant decline of 9% compared to the previous year, while sales of bowls, chicken tenders, and burritos rose by 1%.
As part of its methodology, Toast used a cohort of same-store sales data from its platform between April 1, 2023, and June 30, 2024, to assess price growth in 13 different food categories. The platform also examined hourly transaction patterns during this period to track the shift in consumer preferences towards breakfast items.
According to the report, powered by Toast Benchmarking, which utilizes AI-based classification, restaurants can compare their performance against aggregated data from peer restaurants on the platform. This tool offers valuable insights for restaurateurs looking to optimize menu pricing and operations based on market trends.
