Restaurant owners and franchise owners are getting squeezed from both sides, and the squeeze is not subtle. Costs rose, menus rose with them, and now a growing share of guests are quietly asking a brutal question at the point of purchase: is this worth it?
That question is the real competition now.
McKinsey put hard numbers to what operators have been hearing in softer language for a while: when diners say a recent restaurant visit “wasn’t worth the money,” the disappointment is driven most by food quality and portion size. That is not a pricing problem. That is a product problem. It is also a trust problem. It means you are not just competing on what you charge, you are competing on the story the guest tells themselves after the first bite. That story is either “good call” or “I got played.” The McKinsey consumer research is telling you which story is spreading faster.
Now add the second punch. The restaurant experience is increasingly happening away from your dining room. The National Restaurant Association says nearly 75% of restaurant traffic is off premises. Read that again. Most of your guest interactions happen after your food leaves your four walls. That is not a trend. That is a structural redesign of the category. The National Restaurant Association off premises data makes it official.
So the industry’s core problem is not “how do we drive traffic.” It is “how do we reliably deliver ‘worth it’ in a world where the meal often leaves the building.”
That is the problem. Here comes the tension.
The tension: the obvious moves are the wrong moves
When “worth it” collapses, operators reach for two levers because they are visible and fast.
The first is discounting. You run value offers. You bundle. You train your customers to wait for a deal. You do it because you have payroll on Friday and you cannot deposit “brand equity” at the bank.
The second is cost cutting. Smaller portions. Cheaper inputs. Fewer labor hours. Less training. Less prep. Less love.
Both levers can work for a minute. Both are also self sabotaging if they become your strategy.
Discounting teaches guests that your regular price was never real. Cost cutting quietly makes the McKinsey problem worse by attacking the very things guests use to judge value: quality and portion size. The guest is not doing algebra, they are doing vibes. “Worth it” is a feeling, and your margin tactics can poison it.
Off premises makes this sharper. You can execute a beautiful in store experience and still lose the guest if the pickup shelf is chaos or the fries steam themselves into sadness on the drive home. Restaurant Business, covering the same off premises report, calls out that customers want speed, value, and better packaging. Packaging is not a detail anymore. It is the frame around the product. The Restaurant Business coverage of off premises expectations is basically a warning label.
Franchising adds a third layer of tension: scale exposes weaknesses. If your unit economics are fragile, growth does not save you. It multiplies your problems at a higher monthly royalty rate.
Yet franchising is still expanding. The International Franchise Association projects about 851,000 franchise establishments and more than $936B in output in 2025. That is a lot of new units chasing the same consumer who is increasingly value sensitive. The IFA franchising economic outlook is optimistic on growth, but growth in a worth it economy punishes sloppy operators faster.
So what now? If you cannot simply discount your way out, and you cannot simply cut your way to health, what is the move that earns its keep?
The insight: value is a system, not a price
Most operators talk about value like it is a number. It is not. Value is a system the guest experiences.
Here is the mental model that holds up across both restaurants and franchising:
The Worth It Stack
Guests decide “worth it” using three layers, in this order.
Substance. The food and beverage must deliver. Quality, portion, temperature, accuracy. This is the base layer. If it fails, nothing else matters. McKinsey’s data on disappointment anchors this: quality and portion are the first mental receipts guests check. The McKinsey findings on what drives disappointment are the clearest articulation of Substance I have seen in a mainstream report.
Friction. How hard was it to get the meal? Ordering, pickup, drive thru, delivery handoff. If off premises is nearly 75% of traffic, Friction is not an edge case. It is the main stage. The National Restaurant Association off premises report release is essentially saying the guest’s time is now the primary currency.
Signal. The cues that tell the guest what they are getting before they taste it. Menu clarity. Packaging. Transparency. Brand trust. This is where you can raise perceived value without touching food cost. And it is not fluff. Off premises makes Signal unavoidable because the meal often arrives without your staff present to smooth the edges. Again, the Restaurant Business coverage of packaging and off premises quality is a practical guide: if the product degrades in transit, your value story collapses.
This is why the next era will reward design minded operators. Not just chefs and marketers. Designers of the full system that produces “worth it” repeatedly.
If you are a franchisor, this stack becomes your operating doctrine. Your job is not only brand consistency. Your job is to make it easier for franchisees to win Substance, Friction, and Signal without heroics. That is what “support” should mean.
And this is where franchising is quietly telling you what it values. Franchisors are pouring money into technology. FRANdata reported that 75% of franchisors expect to increase capital spending on technology and innovation in 2025. The FRANdata analysis on franchisor tech investment is now a budget trend. Meanwhile, labor remains the top constraint. The IFA’s annual franchisor survey shows a meaningful share of executives still cite labor as the top challenge, and many franchisees still have open positions. The IFA 2025 franchisor survey makes the point in black and white: 70% of respondents report that their franchisees have unfulfilled job vacancies.
Translation: the franchise systems that win will be the ones that design operations for the labor reality, not the labor fantasy.
The application: three moves that actually hold up
You do not need 17 initiatives. You need three moves that reinforce each other and show up in the guest experience fast.
1) Rebuild value around Substance, not discounts
If quality and portion are what guests cite when they feel burned, then protect them like you protect rent. This does not require expensive ingredients. It requires consistency, accuracy, and a hard stance against silent portion drift.
The point is not “bigger portions.” The point is “predictable satisfaction.” Guests forgive a lot when the product hits every time. They do not forgive roulette.
2) Treat off premises as your primary dining room
If nearly 75% of traffic is off premises, then your pickup flow, packaging, and order handoff are the new front of house. Speed and packaging are not operational details. They are value delivery mechanisms.
Walk your pickup experience like a guest. If it feels like a storage closet with a credit card reader, your brand is telling the guest: you are an afterthought.
3) If you franchise, build systems that remove operator pain
In a growth market, franchisees choose brands that make money and make life easier.
That means technology only counts if it reduces workload or increases throughput without breaking quality. The industry is already moving that way. The FRANdata reporting on rising franchisor tech spending is your signal.
If your field support still looks like inspections and reminders, you are behind. Your competitors are turning support into unit level performance engineering.
The nuance: there is no free lunch, just better tradeoffs
Designing “worth it” has costs.
Protecting Substance can raise food cost or prep time. Reducing Friction can require labor, packaging expense, or process discipline. Investing in Signal can mean better packaging, clearer menus, and training.
The tradeoff is that these costs are mostly controllable and compounding. Discounting is also a cost, but it is a cost that trains the guest to want more.
A worth it strategy is basically choosing to pay for value with operations and design, instead of paying for traffic with margin.
Also, not every concept needs to chase every daypart or every channel. Off premises is essential, but not every menu travels well, and forcing it can damage Substance. The right answer is selective excellence.
The durable takeaway: stop asking “what should we charge” and start asking “what should the guest feel”
If you want one behavior change to take back to your next leadership meeting, it is this:
Build a weekly habit around the Worth It Stack.
Pick one menu item, one channel, one daypart. Evaluate it through Substance, Friction, and Signal. Fix the weakest layer first. Then repeat next week.
This is not a branding exercise. It is a cash flow exercise disguised as hospitality.
Because the restaurants and franchise systems that win the next cycle will not be the ones with the cleverest promotions. They will be the ones that reliably make the guest think, without much effort: yeah, that was worth it.
Peyton Vitter
Managing Partner, SMG Capital
About SMG Capital
SMG Capital is a CFO advisory firm that enables multi-unit businesses with a focus on restaurants and franchisees to build financial infrastructure, reporting systems, and strategic clarity to drive growth and prepare for capital events. We’ve worked with over 700 restaurants including 200+ unit QSR franchisee and private equity backed portfolio companies across PE firms with more than $5B in AUM.