The Culture Wars: Gen Z Takes Over
Gen Z is quickly becoming fast casual’s most influential customer, and few brands have been navigating that shift as deliberately as Penn Station. On a recent episode of Fast Casual Nation, hosts Paul Barron and Cherryh Cansler sat down with Lance Vaught, president of Penn Station, and Tomás Gilbert, director at consumer research firm Curion, to unpack how a 40-plus-year-old sandwich brand is adapting to a generation that grew up with a phone in hand. The conversation covered everything from hiring and training to marketing, customization and the future of automation, and it painted a picture of a brand leaning into its regional roots rather than chasing national scale.
Founded in 1985 by Jeff Osterfeld in Cincinnati, Penn Station has grown into a super-regional player with more than 300 locations, almost entirely franchised, concentrated within roughly 300 miles of its home base. That regional density, Vaught explained, is a deliberate advantage. Franchisees live in the communities they serve, sponsor local schools, and build restaurants that carry neighborhood names rather than store numbers, an approach the team believes resonates with a generation that values authenticity over polish. The brand’s open-display cooking model, unchanged since its mall food-court origins, reinforces that same transparency: customers watch their food sliced, grilled and fried in front of them, with no microwaves and no hidden back kitchen.
That transparency extends to how Penn Station is rethinking recruitment and training. Gilbert noted that Gen Z workers are frequently competing against the flexibility of gig-economy jobs like Uber and Postmates, which puts pressure on traditional restaurant employers to rethink not just pay but scheduling and management style. Vaught described how Penn Station replaced its old “read the manual and learn by osmosis” onboarding with a fully digital, video-based and gamified training portal, cutting the time it takes to get a new hire ready to run a shift from weeks down to just a couple of shifts. Local store marketing, including school partnerships and community fundraising efforts like the brand’s “Deals for Down Syndrome” campaign, is also positioned as both a customer and recruiting tool.
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On the marketing side, both guests argued that some long-standing fast casual habits need to be retired. Vaught pointed to heavy reliance on discounting and single-spokesperson ad campaigns as outdated tactics that don’t move a younger, more skeptical audience. Gilbert echoed that sentiment, citing Curion research showing that roughly 70% of consumers, led by Gen Z, say sustainability and transparency directly influence where they spend. Rather than telling customers what they want to hear, both agreed brands need to show their work, whether that is sourcing, sustainability practices or the simple visibility of food being prepared fresh in front of the guest.
Technology is playing a growing role in that effort. Penn Station is currently testing an AI-driven video feature on its website, built with a company called Zikin, that learns a customer’s ordering habits and surfaces relevant menu content, such as suggesting a cheese dipper to a regular cheesesteak buyer. Gilbert noted that Gen Z is generally comfortable sharing data with brands as long as it translates into convenience rather than feeling intrusive. Both guests agreed automation and robotics will expand behind the scenes in the next five years, but stressed that human connection at the counter will remain essential; the winning brands, Gilbert said, will be the ones that automate what customers don’t care about while preserving the moments that make the experience feel personal.
For operators considering the franchise route, Vaught shared some of the numbers behind the model: an average unit volume around $860,000 this year, with the top quartile exceeding $1.3 million, and an all-in buildout cost of roughly $613,000. With 315 locations across 68 franchise groups and markets mapped out in 14 states, Penn Station’s leadership sees its next chapter defined less by chasing scale for its own sake and more by deepening the kind of hyper-local, transparent relationships that Gen Z consumers and employees are increasingly demanding.
