"However you define ‘independent’ restaurants, the macro environment is not generating demand growth,” says David Portalatin, NPD’s vice president, industry analysis and author of Eating Patterns in America.
Chicago (PRWEB) July 11, 2017
There has been a lot of buzz about the strength of independent restaurants, even to the point of some saying independents were doing better than major chains. A clear understanding of restaurant performance begins with defining the landscape, says The NPD Group, a leading global information company. In the first quarter of 2017 consumer visits to major chain restaurants, which represent 64 percent of total industry traffic, were up one percent over year ago compared to a 3 percent visit decline to independent restaurants, which represent 22 percent of all foodservice traffic. Consumer spending at major chains increased by 3 percent over year ago and spending was flat at independents, according to NPD, which continually measures the foodservice industry in multiple ways.
The decline in customer visits to independents is largely a reflection of the fact that independent restaurant unit count dropped by 4 percent. A 4 percent decline in unit count but only a 3 percent decline in visits suggests that there are some of the 323,456 remaining independent restaurants in the U.S. succeeding. For example, independent operators doing well enough to order from broadline foodservice distributors increased their dollar spend by 2 percent and cases ordered from these distributors were up slightly in the first quarter compared to year ago, reports NPD.
There are also those independents successful enough to expand to 3-19 units, which NPD classifies as micro-chains. Micro-chain counts, particularly in major metro areas, are increasing and this diverse segment of restaurants often reflects emerging trends in food and customer experience, which often enables success. Micro-chain case orders from broadline foodservice distributors grew by 3 percent in the first quarter compared to year ago.
“However you define ‘independent’ restaurants, the macro environment is not generating demand growth,” says David Portalatin, NPD’s vice president, industry analysis and author of Eating Patterns in America. “But even in this challenging environment there are many examples of major chains, micro-chains, and independents that are thriving because they have a differentiated experience, superior quality, and excellence in execution. These fundamentals are key to restaurant success at every segment of the industry and in any macro-economic environment.”
About The NPD Group
NPD is the leading global provider of market information and business solutions covering brick-and-mortar, e-commerce, and emerging channels in more than 20 industries. We combine our unique data assets with analytic solutions to help our clients measure performance, predict trends, and improve results, advising them to help drive successful growth. Practice areas include apparel, appliances, automotive, beauty, books, consumer electronics, diamonds, e-commerce, entertainment, fashion accessories, food consumption, foodservice, footwear, home, juvenile products, mobile, office supplies, retail, sports, technology, toys, travel retail, games, and watches / jewelry. For more information, visit npd.com and npdgroupblog.com. Follow us on Twitter: @npdgroup