Type of Submission

Refereed Article


Among several industry characteristics, capital intensity plays an important explanatory role for the restaurant industry. A restaurant needs physical buildings, equipment, fixtures, and furniture all ready at the launch of a business; these require considerable capital expenditures. Considering capital intensity as a significant restaurant industry characteristic, educators and practitioners who focus on this industry are strongly encouraged to investigate implications and effects of capital intensity in food service operations. The purpose of this study is to examine the effect of capital intensity on a firm’s value performance in the U.S. restaurant industry. The investigation period spans from 2000 to 2008. Findings suggest that capital intensity has a negative effect on U.S. restaurant firms’ value performance.