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Industry performance mixed, but independents stay strong

Industry performance mixed, but independents stay strong

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Although Technomic’s latest forecast for the foodservice industry was tepid, the news was more positive for independent restaurants. In a special session at the National Restaurant Association’s Restaurant, Hotel-Motel Show in Chicago, Technomic announced growth expectations for the year for all of the foodservice industry dipped slightly from the 3.9 percent forecasted in January to 3.8 percent now, but independent restaurants continue to outperform those numbers and chains.

Independents were up 5.6 percent last year, compared to 4.9 percent for chains. Joe Pawlak, Technomic v.p., says consumers are experiencing “fatigue” when it comes to full-service chains. Even with more discounts and deals available at chains, consumers feel independents provide better value in terms of unique menu items, unique experiences and fair price points, Pawlak added.

“Little differentiation among various chains in terms of offerings and ambiance is an issue,” he says. Lodging, supermarket, college and university and senior living are the other foodservice segments projected to outperform restaurants and bars this year.

Somewhat contrary to Technomic’s latest report, the U.S. Census Bureau reported a new record high for sales at eating and drinking places in April. The $45.9 billion was up 0.8 percent over March and approximately $200 million more than the previous high in December of last year. This comes on the heels of a slow first three months that couldn’t keep pace with the strong December.

A new NRA survey shows there is potential for even more growth this year. Forty-nine percent of 1,000 surveyed adults say they are not eating at restaurants as frequently as they’d like. And 51 percent say they aren’t purchasing as much takeout or delivery as they’d like. If consumer confidence continues to improve, as the payroll tax hike gets further in the rearview mirror, that pent-up demand should lead to even more positive results in the months ahead.

OpenTable also just released its Restaurant Industry Index for the first quarter of the year, and it fell 1.3 percent in the U.S. The index tracks the number of all guests served in more than 9,000 reservation-taking restaurants sampled from OpenTable’s network. Philadelphia (4.8 percent), Atlanta (4.5 percent) and Chicago (4.3 percent) saw significant declines, while Denver (1.4 percent) and San Francisco (1.3 percent) saw slight increases.

So it appears restaurants are doing at least OK, and possible even better, depending on the source of data you like the best.

TAGS: Finance
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