Restaurant Industry Outlook Still Uncertain
Jan 5, 2010
 Print this page
The outlook for the restaurant industry remained cloudy in November, as the National Restaurant Association’s comprehensive index of restaurant activity registered its third decline in the last four months.

The Association’s Restaurant Performance Index (RPI) – a monthly composite index that tracks the health of and outlook for the U.S. restaurant industry – stood at 97.8 in November, down 0.2 percent from its October level. In addition, the RPI remained below 100 for the 25th consecutive month, which signifies contraction in the index of key industry indicators.

“Although the RPI remained below 100 for the 25th consecutive month, which signals contraction, restaurant operators are cautiously optimistic that conditions will improve in the months ahead,” said Hudson Riehle, senior vice president of the Research and Knowledge Group for the association. “Restaurant operators reported a positive six-month sales outlook for the first time in three months, and remained optimistic that the economy will improve during the next six months.”

The Restaurant Performance Index 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.

Along with soft sales and traffic levels, operators reported a dropoff in capital spending activity. Thirty-three percent of operators said they made a capital expenditure for equipment, expansion or remodeling during the last three months, down from 40 percent who reported similarly last month.

Restaurant operators’ plans for capital expenditures held relatively constant. Forty-one percent of restaurant operators plan to make a capital expenditure for equipment, expansion or remodeling in the next six months, compared to 42 percent who reported similarly last month.

Back to Breaking News