Restaurant Declines Slowing
September 20/Chicago/Food & Beverage Close-Up -- The effects of a lingering recession continued to keep visits to U.S. restaurants down for the eighth consecutive quarter this past spring, but the rate of decline eased over the same quarter a year ago, according to The NPD Group, a market research company.
NPD's foodservice market research reports that visits to restaurants declined by -1% in the quarter ending June 2010, an improvement over the -3% traffic loss in spring 2009. After four consecutive quarters of declines consumer spending at commercial foodservice, this spring edged above a year ago spending, with a +1% lift.
According to NPD's CREST, which continually tracks consumer usage of commercial and non-commercial foodservice outlets, traffic was weakest at full-service restaurants; visits to casual dining restaurants were down -2%, and midscale restaurant traffic was down -3%. Traffic to quick service restaurants (QSR) was stable in the second calendar quarter, following five quarters of year-over-year declines.
Visit losses at non-commercial foodservice outlets also eased slightly in the second quarter, though traffic is still -6% below year ago levels for the same quarter ending June 2010, according to NPD's CREST OnSite, which tracks usage of foodservice at business and industry, secondary schools, colleges and universities, hospitals, lodging, recreation, senior care, military and vending segments.
Sectors most affected by the economy and high unemployment, such as business and industry, vending and recreation, posted the steepest declines.
"Although the traffic declines moderated this past spring, restaurant operators continued to battle for market share," says Bonnie Riggs, NPD's restaurant industry analyst. "Throughout the recession, selected chains have been successful at increasing traffic by aggressively marketing new offers while also providing some low-priced options. One area that showed growth this past quarter came from the value menu, generally a very low price point option for consumers."
NPD's forecast for the foodservice industry this year suggests traffic will stabilize in the third quarter and begin to recover in the fourth quarter.
From the October 4, 2010, Prepared Foods E-dition