Chain restaurants starved for new customers

By Ashley M. Heher The Associated Press "Customers are conditioned to 'shop the discounts,' " an analyst says. ( Associated Press file photo ) CHICAGO — Fortunes at chain restaurants are tumbling, the fallout from a strategy of slashing menu prices in the hopes that a cheap meal will be enough to entice diners back to their booths. Instead, diners are ringing up smaller checks or simply staying home. And the deep discounts, like the two meals for $20 being offered at places such as Chili's and Applebee's, come with a high cost for sales and profits. Some worry the chains are creating a culture of diners looking only for a cheap meal. "These companies are competing any way they can to get customers in the door," said Morningstar restaurant analyst R.J. Hottovy. While the discounts became prevalent earlier this year, the... [read full story]                    

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