Driven by solid same-store sales and traffic results and an increasingly bullish outlook among restaurant operators, the National Restaurant Association’s Restaurant Performance Index (RPI) matched its post-recession high in March. The RPI – a monthly composite index that tracks the health of and outlook for the U.S. restaurant industry – stood at 102.2 in March, up 0.3 percent from February and equaling its post-recession high that was previously reached in December 2011.
In addition, the RPI stood above 100 for the fifth consecutive month in March, which signifies expansion in the index of key industry indicators.
The first quarter finished strong with a solid majority of restaurant operators reporting higher same-store sales and customer traffic levels in March.
Current Situation Index
The Current Situation Index, which measures current trends in four industry indicators (same-store sales, traffic, labor and capital expenditures), stood at 102.0 in March – up 0.1 percent from February’s level of 101.9. It remained above 100 for the fifth consecutive month, signifying expansion in the current situation indicators.
Restaurant operators reported positive same-store sales for the tenth consecutive month in March, with sales results similar to their February performance. Sixty-five percent of restaurant operators reported a same-store sales gain between March 2011 and March 2012, up slightly from 63 percent who reported a sales gain in February.
Restaurant operators also reported positive customer traffic results in March. Fifty-five percent of restaurant operators reported higher customer traffic levels between March 2011 and March 2012, while 24 percent reported a traffic decline. In February, 55 percent of operators reported higher customer traffic, while 19 percent reported a traffic decline.
The Expectations Index, which measures restaurant operators’ six-month outlook for four industry indicators (same-store sales, employees, capital expenditures and business conditions), stood at 102.4 in March – up 0.4 percent from February and the strongest level in 15 months.
For the fourth consecutive month, a majority of restaurant operators expect their sales to be higher in the months ahead. Fifty-three percent of restaurant operators expect to have higher sales in six months (compared to the same period in the previous year), matching the proportion who reported similarly last month.
For the sixth consecutive month, restaurant operators reported higher expectations for staffing levels in the months ahead. Twenty-seven percent of restaurant operators plan to increase staffing levels in six months (compared to the same period in the previous year), while just 10 percent said they expect to reduce staffing levels in six months.
Along with a positive outlook for sales growth and the economy, restaurant operators are boosting their plans for capital spending in the months ahead. Fifty-six percent of restaurant operators plan to make a capital expenditure for equipment, expansion or remodeling in the next six months, up from 49 percent last month and the strongest level in more than four years.
The RPI is based on the responses to the National Restaurant Association’s Restaurant Industry Tracking Survey, which is fielded monthly among restaurant operators nationwide on a variety of indicators including sales, traffic, labor and capital expenditures.
Source: meatingplace.com, 5.7.12