Sunovis Financial Points to Increased Restaurant Spending from NPD Survey

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Many restaurants are run by small business owners and they should be encouraged by the latest research from The NPD Group. The market research firm found that visits to restaurants in the first quarter of 2013 were stable in comparison with visits from the first quarter of 2012, when mild winter weather encouraged increased restaurant visits.

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...keep in mind that consumers still made over 61 billion restaurant visits last year, which means that there is still significant demand.

Many restaurants are run by small business owners and they should be encouraged by the latest research from The NPD Group. The market research firm found that visits to restaurants in the first quarter of 2013 were stable in comparison with visits from the first quarter of 2012, when mild winter weather encouraged increased restaurant visits. The group’s research also found a 2 percent increase in the average check size for the quarter.

NPD is forecasting that restaurant traffic will remain flat for the remainder of the year, but that average check size will increase by 2.7 percent.

“While the flat traffic levels aren’t great, the increased check size is encouraging for small restaurant owners. Increased check sizes often translate almost directly to bottom line profits, which is ultimately better for small restaurants,” said Terry Robinson, president of Sunovis Financial.

The groups research found that traffic declined by 1 percent for casual dining establishments and by 2 percent for midscale/family type restaurants when compared with the same quarter last year. These declines were more than offset by the steady traffic for quick service restaurants and the 5 percent gains notched by fine dining and upscale restaurants.

Interestingly, breakfast was the only part that saw increases, with a 2 percent increase in traffic. Lunch traffic was flat, while dinner traffic declined by 1 percent. Mid-afternoon visits also declined by 2 percent.

"Ongoing consumer economic concerns coupled with the payroll tax hike will continue to hinder restaurant industry growth," said Bonnie Riggs, restaurant industry analyst. "It's important for operators and food service manufacturers to keep in mind that consumers still made over 61 billion restaurant visits last year, which means that there is still significant demand. Understanding and meeting the wants and needs of restaurant consumers is the best way to build traffic."

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Kathy Heshelow
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