By Bob Donofrio
Chief Client Officer, Revenue Management Solutions
At this year’s Restaurant Leadership Conference, one word framed the conversation for a room of nearly 200 operators and executives: thin. In today’s compressed-margin environment, growth decisions made without accurate, real-time data are expensive guesses. Revenue Management Solutions (RMS) helps restaurant brands build a clearer picture of their business across pricing, traffic and unit economics, identifying margin improvement opportunities averaging 3.9% per location.
Speaking to a packed room of restaurant operators and executives at the Restaurant Leadership Conference in Phoenix, I opened with a single word.
Thin.
Why Restaurant Margins Are Thinner In 2026
Even before recent global supply disruptions, input costs were already stacking up. RMS survey data shows protein is in high demand and consumers are willing to pay a premium for it, but chicken wholesale prices are up 35% over the past two years, beef is up 30% and the cattle herd is at a 20-year low. There is no near-term relief on the horizon. With energy prices volatile, the ripple effects on input costs will continue to compound.
Pricing power is weakening at the same time. In RMS’ Q1 2026 consumer report, Order Up: How Americans Are Dining in 2026, 72% of consumers said restaurant prices feel higher than a month ago. That number has held roughly flat for four quarters. Grocery price perception dropped 14 points over the same period, to 68%.
The pressure has shifted. Consumers are no longer feeling more pain at the grocery store than at restaurants, which means restaurants need to be more deliberate about where and how they raise prices.
Q1 2026 marks the first time in four quarters that restaurant price perception has run higher than grocery.
The playbook is targeted value, bundles, promotions and menu engineering, not across-the-board price increases. The consumer is responding to that value play. In our Growth Drivers report, the percentage of QSR brands experiencing balanced growth rebounded from just under 30% in Q4 2025 to 36%.
Balanced growth is when traffic and check size improve together, rather than sales rising on price alone while guest counts stay flat or fall. That is the goal for any healthy brand. Check-driven growth, where higher sales come from price while traffic falls, can look healthy for a quarter or two, but it is a warning sign. The brands standing in five years are the ones building real customer momentum, not borrowing from future price capacity.
Expensive Guesses Are a Luxury No One Can Afford
The phrase “expensive guesses” resonated in the room, and for good reason. The brands outperforming right now are not just working harder. They are making faster, better decisions because they can see what is actually happening across their system: which locations are underperforming and why, where pricing power lives by item, channel and customer segment, and which trade areas have shifted.
One of the panelists, Scott Drake, CEO and President of CEC Entertainment, put it well in our pre-session conversation: the data that exists today compared to 10 or 20 years ago is the competitive advantage. Growth decisions made without that clarity are, as I told the room, just expensive guesses. And the margin for expensive guesses is gone.
The Two Levers for Restaurant Growth
Strip it down and there are two things every brand needs: capital and customers.
Capital starts with four-wall profitability. Where is the system leaking? Which franchisees are underperforming, and why? What would it look like if your whole system performed more like your top quartile?
That kind of visibility is what metiRi® by RMS was built to deliver. Our financial reporting tool aggregates franchise financial data across a system regardless of how individual franchisees track their numbers, then surfaces peer benchmarking and unit-level diagnostics that can lift the entire network. When franchisees get healthier, they invest more in the brand and the capital flywheel starts to turn.
Customers are the other half of the equation and right now, getting and keeping them is hard. Price sensitivity is high. Data helps here too, giving operators a clearer picture of traffic, sales and the competitive landscape so they offer each menu item at the right price, channel, daypart and customer segment.
The Common Thread Among Brands Growing in 2026
The path to growth will look different for every brand. The panelists who joined me on stage, Scott Drake of CEC Entertainment, Chris Bremer of Smoothie King and Jason Rusk of Wonder, are each navigating very different paths. But they share this: they are using today’s information to shape tomorrow’s strategy.
That is not a luxury. In an environment this thin, with this little margin for expensive guesses, it is a requirement.
Download the RMS Protein & Fiber Playbook for the full data.
