WASHINGTON The National Restaurant Association projected Wednesday that 2010 will include a gradual improvement in sales for the restaurant industry, as upticks in real disposable income, employment and national population counts drive the economy into a better light than the darkness of years past.
Industry sales are projected to reach $580.1 billion this year, a 2.5-percent increase in current dollars from 2009. When adjusted for inflation, 2010 sales will be essentially flat from 2009 levels, or fall 0.1 percent, which is an improvement over the 1.2-percent and 2.9-percent real sales declines the industry booked in 2008 and 2009, respectively.
“Cautious optimism is definitely the watch words for 2010,” said Hudson Riehle, the NRA’s senior vice president of research and knowledge. “Obviously there will be no rebound to prosperity in 2010 É but the entrepreneurship, optimism and flexibility of restaurant operators will show that, no doubt, there can be success achieved by many members of the [restaurant] community.”
Like the trends of the past few years, the quick-service segment is expected to fare slightly better than the full-service segment, as diners focus on value and specials. Quick-service restaurants are projected to post sales of $164.8 billion in 2010, a gain of 3.0 percent in current dollars over 2009. Sales at full-service restaurants are projected to reach $184.2 billion in 2010, an increase of 1.2 percent over 2009.
The restaurant industry has felt severe pressures from the downtrodden economy for the past two years, including reduced consumer spending, rising unemployment and unstable capital markets. To combat the falling traffic levels that led to reduced sales, operators have cut costs, streamlined operations and attempted to drive traffic through lower-priced offerings or other value-driven promotions.
According to an NRA operator survey completed in December, most operators say their businesses will do better in 2010 than in 2009. Helping the industry, Riehle said, are such long-term trends as continued population growth, households with dual earners who are too busy to cook at home and the continued desire to frequent restaurants for social engagements.
“Despite the most severe economic retrenchment in seven decades, industry sales will still [grow] and almost half of the food dollar will be allocated toward restaurants,” Riehle said.
Arecent consumer survey by the NRA showed 35 percent of adults surveyed said they don’t eat out at restaurants as often as they would like, and 65 percent of adults surveyed said their favorite restaurant foods provide flavors and tastes they can’t easily duplicate at home.