Americans have been hit hard by rising menu prices in recent years, as restaurants pass on rising food and labor costs.
But Texas Roadhouse has fought to keep prices low, offering meat, potatoes and vegetables for around $20 to $25, and it’s paying off as families flock to the chain.
The 31-year-old company, founded in Indiana rather than Texas, reported an 8.5 percent sales increase from July to September compared to the same period in 2023, continuing momentum from earlier in the year.
This jump means millions more steaks were sold over the past year at 655 restaurants across the United States.
This success contrasts sharply with that of many of its competitors. Sales have fallen at Olive Garden, Starbucks and TGI Friday’s.
Texas Roadhouse, founded in Indiana rather than Texas, has seen its sales increase 8.5 percent as Americans flock there in search of cheap steaks.
Texas Roadhouse fans have taken to Reddit to praise the chain.
Meanwhile, McDonald’s managed just a 0.1 percent sales increase, and that was only with the help of the wildly popular five-dollar meal deal.
Unlike most chains facing backlash over price increases, Texas Roadhouse is earning praise on social media.
On Reddit, a thread ‘Texas Roadhouse never disappoints’ has 5,700 upvotes.
Another shows a photo of a steak dinner with the caption ‘incredible value for $22 at Texas Roadhouse,’ and users lined up to agree.
“It’s a beauty,” one user commented on the photo of the steak.
Texas Roadhouse’s main rival, Longhorn Steakhouse, with just under 600 locations, is also seeing sales increase, albeit by a modest four percent.
Both chains have a track record of performing well during economic downturns.
It may seem surprising that steakhouses are thriving in tough times, but the two brands have achieved what many restaurants aspire to: make customers feel like they’re getting good value for money.
Compared to local establishments or high-end chains like STK Steakhouse, the two chains are “very affordable,” said Jim Salera, research analyst at Stephens. cnn.
The average check per person in Longhorn is $26 and for Texas it is $22.
Steak is still considered a luxury, so getting a decent-sized cut along with potatoes and vegetables for that price is good value, experts say.
A busy Texas Roadhouse restaurant
Texas Roadhouse (left) and Longhorn Steakhouse, two more great steaks under $25
“For its core consumer, it really represents affordable luxury,” Salera said.
A recent Bank of America note discussing LongHorn’s results echoed this sentiment: “Consumers recognize the core plate value of steak.”
Most restaurants have imposed large price increases. McDonald’s, for example, has increased prices by an average of 40 percent since 2019, it said recently.
Things are different in LongHorn and Texas, BTIG restaurant analyst Peter Saleh told CNN.
He said they have been trying to raise prices below inflation “for a while now.”