Why Chipotle Rival Cava Is Skyrocketing in Popularity Right Now
From Outback Steakhouse to Kona Grill, a growing number of restaurant chains have been losing favor among customers and struggling with significant sales declines in 2024. However, a booming chain that some have dubbed a "better version" of Chipotle has become an exception to that trend.
Cava, a fast-casual Mediterranean brand that specializes in customizable grain bowls, salads, and pita wraps, is currently a mecca for those looking to eat a crunchy, healthful lunch. The foot traffic platform Placer.ai took an in-depth look at Cava's performance in a new report published on May 21—and the results show that it's currently skyrocketing in popularity.
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According to Placer.ai, Cava saw a whopping 23.6% increase in customer visits in the first quarter of 2024 compared to the same period last year. That data starkly contrasts how some of its fellow restaurant chains fared during the quarter. Outback and Kona Grill, for example, reported 4.2% and 14% declines in customer traffic in the first few months of 2024, respectively. First Watch and Starbucks have also seen drops in customer traffic or fewer transactions this year.
So why is Cava performing so well as some of its peers struggle? Placer.ai noted that much of its recent success is likely due to its aggressive expansion efforts. According to its latest earnings report, the chain ended 2023 with more than 300 locations and plans to add 48 to 52 new stores in 2024. It has a longer-term goal of reaching 1,000 restaurants by 2032.
"We've built a strong foundation to support that growth, and our powerful unit economic engine continues to drive us forward," CEO Brett Schulman said during a Feb. 27 earnings call.
New Cava restaurants have also proven to be extremely lucrative. During the earnings call, CFO Tricia Tolivar said that average unit volumes (the sales each individual store sees on average) and profit margins at new Cava stores have been "exceeding our expectations." Overall, the company grew its revenues by 52.5% in 2023 and saw an impressive 17.9% increase in same-store sales.
"CAVA continues to get stronger with every new restaurant we open and every new guest we welcome to our table," Tolivar said.
In other Cava news, the chain recently entered the upper Midwest for the first time with the opening of a new Chicago location. It also recently held a contest where customers could submit their go-to custom bowls for a chance to win store credit and see their creations featured on the menu. Cava added three winning bowls from the contest to its menu on May 20, and they'll remain available through June 2. Details on the bowls are available on the Cava website.
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