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While Casual Chains Drop Prices, Fast Food Trades Up

Regardless of its location, price point, or popularity, no restaurant has remained untouched by the deteriorating economy. While many high-end restaurants have made adjustments, some of the most drastic changes taking place are happening between fast and casual food chains.

Casual restaurant chains such as Applebee's, Chili's, and TGI Friday's have desperately tried to keep sales steady with bargain deals. Applebee's started the trend by appealing to cash-strapped diners with a limited-time offer for a large appetizer with two entrees for just $20. Chili's joined in soon after with a "ten under $7" value menu. Earlier this week, TGI Friday's slashed the prices of all sandwiches and salads to a mere $5.Ironically enough, fast food chains have focused on premium items. Late last year, Burger King aimed to go higher-end with a new line of ribs, and this August, McDonald's is coming out with a one-third-pound Angus beef burger that's priced at $3.99. The number one fast food chain has also been selling specialty coffee drinks at its McCafé stores.

As both segments expand their food offerings, the casual chain and fast food sectors have become somewhat redundant. Have you frequented more fast food or casual chains lately? Which do you think has a better business model?


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