This exclusive series to Nation’s Restaurant News provides C-level insights into the sales and traffic data from clients subscribing to Black Box Intelligence, a financial performance benchmarking company. The views expressed here do not necessarily reflect those of Nation’s Restaurant News.
Welcome to the 2013 dog days of summer.
The Black Box Intelligence Index was flat for June after three months of positive sales. For the second quarter we reported a 4-percent increase, and for the year, we remain negative with a .4-percent decrease.
We have had a flood of inquires from our members asking, “What is going on in the market?” From our perspective, we feel a bit like the sales and traffic numbers: We seem to just be stuck.
With 2011 and 2012 sales positive .7 percent, we hoped that the rebound would continue — albeit take longer. However, the underlying and somewhat systemic issue of comparable customer traffic illuminates the weakness in our industry: It declined 2 percent for both the month of June and the quarter.
However, a deeper dive into the numbers is needed. The first quarter of 2013 showed a decline of 1.4 percent versus a 1.6-percent increase during the same quarter in 2012. The second quarter of 2013 posted a .4-percent increase versus a .6-percent increase in 2012. The third quarter of 2012 showed a .2-percent increase, and the fourth quarter of 2012 declined .2 percent.
All of this would have led me to predict flat or some upside based on weaker comparisons. We will just have to keep watching for the sails to fill.
As I mention wind in our sails, I also want to note that any sailor worth their proverbial salt knows that the devil is in the details. Analyzing our current position is the same.
While studying our data an interesting statistic popped out to me. We use an 18-month convention to collect total sales from our members in order to report on comparable performance. However, we seldom have commented on total sales growth.
This quarter, I found it particularly interesting that the real sales growth in our consortium of over 15,000 units is starting to move. For the year, it is growing at 2.9 percent, but for the quarter it was 3.6 percent. This would signal new growth is under way for concepts that are well positioned and capitalized. While we know not all brands are growing, this is still positive news for the industry — which brings me back to my sailor analogy.
As a sailor, you are always looking for the right amount of wind to fill your sails. If you don’t find the wind, you find yourself dead in the water or moving at a snail’s pace, losing the race.
Sailing, to me, is much like running a restaurant company. You have to continually monitor the environment, weather, and placement of other boats. You have to constantly adjust your primary performance levers, the tiller and the sails to maximize the opportunity to win the race. It is not easy and requires skills and experience. Additionally, every boat and every day is different. Sound familiar?
I wish you wind in your sails and mastery of the levers to make the rest of 2013 your winning season.
Wallace B. Doolin
Doolin is Chairman of Thomas Doolin and Associates LLC, the holding company of People Report, the leader in human capital business intelligence for the restaurant industry and Black Box Intelligence. He is the Founder of Black Box Intelligence, a state of the art business intelligence software product also for the restaurant industry. Additionally, he serves as a Trustee Emeritus of the National Restaurant Association and National Restaurant Association's Education Foundation where he is a past Chairman. Other current responsibilities include serving as a Board Director for Famous Dave’s, a public company; SplickIt, a mobile technology company; Phase Next Hospitality, a nontraditional operator/franchisee; and Share Our Strengt,h a leading nonprofit. Previously, Doolin served as CEO of Carlson Restaurants Worldwide, T.G.I. Friday’s, Buca Inc. and La Madeleine, as well as president of Applebee’s. He is a frequent speaker and writer on the global restaurant industry.
The Restaurant Industry Snapshot is a compilation of real sales and traffic results from 170+ DMAs from 100+ restaurant brands and approximately 15,000+ restaurants that are clients of Black Box Intelligence. Currently, data is reported in four distinct segments: casual dining, upscale/fine-dining, fast casual, and family dining. Black Box Intelligence is a sister company to People Report, which tracks one million restaurant employees on workforce analytics. The Restaurant Industry Snapshot also includes the Restaurant Industry Willingness to Spend Index from Consumer Edge Research, which is a monthly household survey of more than 2,500 consumers. Consumer Edge Insights is a marketing partner with Black Box Intelligence and People Report.