Restaurant performance improved in December

by Keith Nunes
Share This:

WASHINGTON – Increased same-store sales, improved customer traffic levels and a growing optimism among restaurant operators boosted the National Restaurant Association’s Restaurant Performance Index in December. For the month, the R.P.I. gained 1.1% compared to November and ended at 101 for the month of December.

"The R.P.I.’s solid gain in December was driven by improvements in each of the eight current situation and forward-looking indicators," said Hudson Riehle, senior vice-president of the Research and Knowledge Group for the N.R.A. "Restaurant operators reported positive same-store sales and customer traffic results in December, and their outlook for sales growth and the economy continued to improve.

"Overall, the R.P.I. stood above 100 for the third time in the last four months, which suggests that the recovery is gaining a firm foothold. Driven by operators’ optimistic outlook for sales and economic conditions in the months ahead, the R.P.I.’s expectations index rose to its highest level in nearly four years."

The expectation index is a component of the R.P.I. that measures the six-month outlook of restaurant operators. In December, the expectations index reached 102.4, a 1.2% increase compared to November and its highest level since March 2007. Restaurant operators are increasingly optimistic about sales growth in the months ahead. Fifty-five per cent of restaurant operators expect to have higher sales in six months, compared to the same period in the previous year, up from 42% in November and the strongest level in more than four years. Only 8% of restaurant operators expect their sales volume in six months to be lower than it was during the same period in the previous year, down from 14% who reported similarly last month.

Restaurant operators are also more bullish about the direction of the overall economy. Forty-six per cent said they expect economic conditions to improve in six months, up from 37% in November. In comparison, only 8% of operators said they expect economic conditions to worsen in the next six months, down from 15% who reported similarly last month.

The current situation index, which is another component that makes up the R.P.I., was 99.7 in December, up 1% compared to November. For the third time in the last four months, operators reported a net increase in same-store sales. Forty-eight per cent reported a same-store sales gain between December 2009 and December 2010, up from 40% of operators who reported higher same-store sales in November. In comparison, 35% of operators reported a same-store sales decline in December, down from 44% of operators who reported negative sales in November.

Operators also reported a net increase in customer traffic levels in December. Forty-three per cent reported an increase in customer traffic between December 2009 and December 2010, up from 36% of operators who reported higher traffic in November. In comparison, 34% reported a traffic decline in December, down from 45% in November.

Comment on this Article
We welcome your thoughtful comments. Please comply with our Community rules.








The views expressed in the comments section of Food Business News do not reflect those of Food Business News or its parent company, Sosland Publishing Co., Kansas City, Mo. Concern regarding a specific comment may be registered with the Editor by clicking the Report Abuse link.