Buoyed by improving same-store sales and customer traffic, foodservice operators expressed optimism about sales growth over the next several months, fueling an increase in the National Restaurant Association’s Restaurant Performance Index for March.
The RPI, a monthly composite that tracks the health of and outlook for the foodservice industry, rose to 101.0 in March, an increase of 0.3 percent over its February level and the third gain in the past four months.
March also was notable in that it marked the first time in more than three and a half years that the Current Situation component of the index stood above the 100 mark, according to the NRA.
“The March increase in the Restaurant Performance Index was fueled by continued improvements in the same-store sales and customer traffic indicators,” said Hudson Riehle, senior vice president of the NRA’s Research and Knowledge Group. “Most notably, the overall Current Situation component of the RPI stood above 100 for the first time in 43 months, which signifies expansion in the indicators of current industry performance.
However, while restaurant operators were optimistic about their own businesses, they were less upbeat about the general economy in the coming months, Riehle said.
“Just 32 percent of restaurant operators expect economic conditions to improve in the next six months, the lowest level since September 2010,” he said.
Watch a video of Riehle providing an industry update:
The Restaurant Performance Index consists of 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 for same-store sales, employees, capital expenditures and business conditions.
The Current Situation Index rose to 100.2 in March, up 0.8 percent from February and its third strong gain in the past four months. The NRA said 52 percent of restaurant operators reported a same-store sales gain between March 2010 and March 2011, an increase over the 49 percent who reported similarly in February. That marks the strongest level since August 2007, the NRA said.
Meanwhile, 45 percent of foodservice operators reported customer traffic increases between March 2010 and March 2011, up from 41 percent who tallied higher traffic levels in February.
The Expectations Index was 101.7 in March, down slightly from 101.9 percent in February. Despite its decline, the index was above the 100 mark for the eighth consecutive month, which signifies expansion in the forward-looking indicators, the NRA said.
The association said restaurateurs believe their sales will grow in the future months. Fifty percent of foodservice operators expect to generate higher sales in six months — compared with the same period a year ago — up slightly from the 48 percent who reported similarly in February.
The RPI is based on responses to the NRA’s monthly tracking survey. The full report is available online at http://www.restaurant.org/pdfs/research/index/201103.pdf.
Contact Paul Frumkin at [email protected].