McDonald’s may be known for its golden arches, and Cava for its four-letter name boldly stamped on each take-out bag, but both restaurant chains have a different letter to sum up business right now: a big K.
“We don’t want to overstate the challenges of the consumer, but you can look at the data,” Schulman told investors on Tuesday. “They’re clearly out there, whether it’s student loan repayment, consumer sentiment, just the inflationary pressures all around them, whether it’s health care cost, housing costs—Gen Z unemployment [is] twice the national average.
“When we look at the data, it’s more that the younger cohort, that 25-to-35…they don’t have the steam that they had last year in the way that they were visiting or their frequency of visiting,” he added.
Industry trends
“This group is facing several headwinds, including unemployment, increased student loan repayment, and slower real wage growth,” Boatwright told investors at the company’s earnings last month. “We’re not losing them to the competition. We’re losing them to grocery and food at home.”
Cava, however, has reiterated it is not a fast-food restaurant. Schulman said the company will continue to rely on its better-for-you branding of fresh ingredients and more premium proteins that some diners may have to pay a couple extra dollars for.
“We’re not going to get into that heavy discounting to combat any cyclical headwinds. That’s why we talked about doubling down on exceptional operations and great guest experiences,” Schulman told investors. “We want to make sure we’re doing everything we had in that spirit to deliver for our guests in this time when they’re feeling pressures all around you.”
