Restaurant industry mostly stable in 2008
February 03, 2009
by FoodBusinessNews.net Staff
CHICAGO — The restaurant industry was stable for most of 2008, but traffic dipped in the fourth quarter, according to The NPD Group.
For the first three quarters of the year, visits and dollars were up compared with the previous year, but the fourth quarter yielded the industry’s slowest traffic and dollar growth since the recession of 2002-2003.
"Despite this past year’s extremely weak economic conditions, the restaurant industry as a whole managed to keep its head above water for most of the year," said Harry Balzer, chief industry analyst and vice-president. "Strong promotional activity on the part of chains and growth in breakfast and lunch visits to quick-service restaurants contributed to the slight gains the industry experienced this past year."
NPD’s Consumer Reports on Eating Share Trends reported food service traffic advanced .2% for the year ended November 2008 and consumer spending grew by 2%.
Promotion-related visits supported all commercial food service gains with deal visits increasing 6% and non-deal visits declining 1%. For the year ended November 2008, 23% of all traffic involved some type of consumer-recognized deal. Quick-service restaurants accounted for 90% of the increase in deal visits.
"I don’t believe consumers, no matter the state of the economy, will abandon restaurants entirely, they will just use them differently — more cost-consciously," Mr. Balzer said. "There will be no recession in eating; there will just be winners and losers. The restaurants that deliver value and make it easy to get food cheaper in new and compelling ways will win."