Placer Bytes: First Watch and Staples

In this Placer Bytes, we dive into First Watch, a rising star in the breakfast space, and Staples, a legacy brand that has been making a surprising comeback. 

First Watch’s Expansion Gamble is Paying Off 

Last winter, while the pandemic was still limiting the dining industry, First Watch was continuing with its expansion plans and opening new locations. And although the daytime restaurant concept’s year-over-two-year (Yo2Y) overall monthly visits were up – thanks to the brand’s aggressive expansion – Yo2Y average visits per venue were down by 21.6%, 22.6%, and 15.5% in January, February, and March, respectively, indicating that the brand was definitely feeling the effects of the drastic downturn in diners. Still, First Watch was playing the long game forged ahead undeterred. 

Now, it seems that the gamble has paid off. Since May, visits-per-venue numbers have reached, and often exceeded, pre-pandemic levels – an impressive feat, given the significantly larger number of venues now compared to 2019. And the return to pre-pandemic visits-per-venue numbers don’t just prove that First Watch’s new 2020 and 2021 locations are a success. Since the chain shows no sign of slowing down its expansion, the rise in visits-per-venue is a promising sign that planned locations will continue in step and thrive.

First Watch’s Wide Appeal

While Florida can boast at having the highest number of First Watch locations, the daytime cafe has expanded its reach across the country– and the local response has been overwhelmingly positive.

To see how First Watch has integrated into newer markets, we dove into the True Trade Area (in this case we took the area from which 70% of a property’s customers come from) of five First Watch restaurants in newer markets and compared the TTA in the second half of 2021 to the TTA in the second half of 2019. The data showed that all the locations analyzed show a 10% to 20% growth in TTA over the past two years. 

There’s often an initial excitement and upsurge in demand when brands enter new markets – but the interest can fade just as quickly if the company doesn’t do the work necessary to integrate into the new community. The fact that First Watch’s reach is expanding over time shows just how successful the brand has been at building and cementing its name in new markets.

The consistent growth in TTA for First Watch branches in states as diverse as Kansas, Wisconsin, New Jersey, Colorado, and Pennsylvania also shows that First Watch has hit on a dining concept with extremely broad appeal. As the company continues to add the locations – First Watch plans to expand to around 2200 locations in the future – up from its current apx. 420 – the daytime dining concept is well positioned to stake out a space at the top as a leading breakfast and lunch player nationwide. 

Is Staples Making a Comeback? 

While rising stars like First Watch are making a splash, some legacy brands are showing that they still have what it takes to compete with the younger players. After being largely written off, Staples appears to have made a surprising comeback in Q4 2021. 

The brand was particularly hard-hit by the Delta wave, which coincided with peak back-to-school shopping – traditionally Staples’s strongest period. Overall monthly changes in visits in October, November, and December 2021 were 0.0%, -1.0%, and 3.1% when compared to the same months in 2019 – which means that Staples foot traffic has essentially returned to its pre-pandemic levels. And this return to 2019  numbers is even more impressive given that the legacy office-supply brand has closed more than 100 stores since the start of the pandemic

Indeed, when looking at the Yo2Y change in visits-per-venue, the numbers look even better. Q4 visits-per-venue were up by 3.9%, 2.5%, and 6.6%, respectively – which could indicate that Staples has now right-sized its store fleet and found a way to optimize its offline reach .

Staples’ Regional Outliers

Staples was founded – and is currently headquartered in – Massachusetts, and it seems that customers in the Bay State, along with customers in Connecticut and Ohio, still maintain higher-than-average loyalties to the brand. While Staples’s Q4 foot traffic was high nationwide, visit growth was particularly large in the three states mentioned previously. In December, for example, when Staples nationwide Yo2Y foot traffic stood at 3.1%, Yo2Y visits in Massachusetts, Connecticut, and Ohio were 7.8%, 13.6%, and 8.4% higher than they had been in 2019. The locations in these states also outperformed the brand’s national average in Q3.

This goes to show the importance for national brands to understand regional variations in foot traffic performance. A struggling brand with nationwide reach might benefit from closing stores in underperforming markets – but it can also use foot-traffic trends to identify regions with higher-than-average demand and loyalty and use this data to drive focussed and strategic growth. 

Will First Watch continue its ascent? Will Staples continue its comeback? 

Visit to find out. 

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