It’s official: Based on federal data, monthly restaurant sales surpassed grocery store sales for the first time, back in December, according to federal data and the National Restaurant Association.
But the trend in recent months does show this: Gas prices have been a massive boon to the restaurant industry.
As NRA Chief Economist Bruce Grindy pointed out, restaurants have quickly narrowed the gap in sales in just over 10 months. In June of 2014, less than a year ago, grocery sales exceeded restaurant sales by $1.6 billion
In April of this year, that gap reversed: Restaurant sales exceeded grocery sales by $1.5 billion.
That’s a $3.1 billion shift, for those doing the math.
That shift, according to the NRA, is nearly equal to the shift toward restaurants over the previous 4.5 years.
So what changed? Gas prices.
While gas prices have been creeping up lately, much of that creep is typical seasonal increase in fuel costs. Gas is $2.67 a gallon, according to AAA. That’s 30 cents higher than it was a month ago.
But it’s still about $1 per gallon lower than it was a year ago at this time.
The increase in restaurant sales coincides with the decrease in fuel prices.
In a survey of 1,008 adults from April 30 through May 3, 80 percent of car owners say the decline in gas prices has positively impacted their household finances. But lower-income households were the most likely to say lower gas prices had a “very significant” impact on their finances.
Lower-income households are among those that cut spending the most in the post-recessionary years. Their increase in spending could help explain sales improvement at chains like Denny’s, IHOP and several QSR concepts including Burger King, Sonic, Jack in the Box and others.
Indeed, 49 percent of car owners who said the lower gas prices improved their finances said that it made them more likely to do things like eat out.
There’s another aspect that Hudson Riehle, senior vice president of the association’s research and knowledge group, pointed out: Lower gas prices make consumers more likely to travel. And consumers who travel are not at home to make their own food.
Of course, there are other reasons why restaurant sales have surged. Consumer confidence is up. Employment is up. And people still like restaurants. They’re also, apparently, buying fewer items at retail shops. Total retail sales in April were weaker than expected.