Continued gains in same-store sales and customer traffic helped to boost optimism among foodservice operators and fueled an increase in the National Restaurant Association’s monthly Restaurant Performance Index for February.
The RPI, a monthly composite index that tracks the health of and outlook for the foodservice industry, climbed to 100.7 in February, a 0.4-percent increase from its January level. February’s results mark the fifth time in the past six months the index stood above 100, a trend the NRA says reflects expansion in the index of key industry indicators.
“February’s RPI gain was driven by solid improvements in the same-store sales and customer traffic indicators,” said Hudson Riehle, senior vice president of the NRA’s Research and Knowledge Group. “Restaurant operators reported positive same-store sales and customer traffic results in February, after January’s results were dampened by extreme weather conditions in many parts of the country.”
The RPI slipped to 100.2 in January, down 0.8 percent from December.
Riehle also said operators’ outlook for capital spending hit a 40-month high in February and their expectations for staffing growth climbed to the highest level in almost four years.
The Restaurant Performance Index comprises two components: the Current Situation Index, which measures current trends in same-store sales, traffic, labor and capital expenditures; and the Expectations Index, which measures restaurant operators’ six-month outlook in the same areas.
The Current Situation Index was 99.4 in February, a 0.9-percent increase over January. The Index remained below the 100 mark for the fourth consecutive month, a result of the softness in labor and capital expenditure indicators, the association said.
Operators were generally upbeat about same-store sales in February, with 49 percent reporting gains between February 2010 and February 2011. That reflects an increase over the 39 percent of operators who reported higher same-store sales in January.
Operators also reported a net increase in customer traffic in February, with 41 percent tallying gains between February 2010 and February 2011. By comparison, 35 percent of operators reported higher traffic in January.
The Expectations Index for February stood at 101.9, reflecting a slight uptick over January’s level of 101.8. The Expectations Index stayed above 100 for the seventh consecutive month, the NRA said, adding that operators remain “solidly optimistic that their sales will improve in the months ahead.
Fueled by an improving sales outlook, operators’ plans for capital spending increased to the highest level in more than three years, with 52 percent of restaurateurs saying they expected to make a capital expenditure for equipment, expansion or remodeling over the next six months, the NRA said. That figure is up from 48 percent who reported similarly in January.
In addition, restaurateurs reported an optimistic outlook for staffing gains in the months ahead, with 26 percent saying they plan to boost staffing levels in six months. Only 10 percent said they anticipated lowering staffing levels during that period.
Yet, while operators told the NRA they were bullish about their sales prospects for the future, they sounded less upbeat about the state of the general economy. Thirty-four percent said they expect economic conditions to improve in six months, down from 42 percent last month, while 14 percent said they anticipate economic conditions will deteriorate.
The RPI is based on the NRA’s monthly tracking survey. Read the full report.
Contact Paul Frumkin at [email protected].