Wednesday, February 29, 2012

Restaurant Performance Index Suggests Ongoing Improvements As Does Fed's Beige Book Report

From today's report from the National Restaurant Association:

"The outlook for the restaurant industry is positive for the coming months, as the National Restaurant Association’s Restaurant Performance Index (RPI) remained well above 100 in January. The RPI – a monthly composite index that tracks the health of and outlook for the U.S. restaurant industry – stood at 101.3 in January, down from December’s strong level of 102.2 (see red line in chart). Despite the decline, January represented the third consecutive month that the RPI stood above 100, which signifies expansion in the index of key industry indicators.

“Although the Restaurant Performance Index dipped somewhat from December’s nearly six-year high, it remained solidly in positive territory,” said Hudson Riehle, senior vice president of the Research and Knowledge Group for the Association. “Restaurant operators reported positive same-store sales for the eighth consecutive month, and a majority of them expect business to continue to improve in the months ahead.”

Other highlights include:

1. Restaurant operators reported positive customer traffic results in January. Forty-six percent of restaurant operators reported higher customer traffic levels between January 2011 and January 2012, while 30 percent reported a traffic decline.

2. The Expectations Index, which measures restaurant operators’ six-month outlook for four industry indicators (same-store sales, employees, capital expenditures and business conditions), stood at 102.1 in January – essentially unchanged from December’s level of 102.3 (see blue line in chart). In addition, January marked the fifth consecutive month that the Expectations Index stood above 100, which represents an optimistic outlook among restaurant operators for business conditions in the months ahead.

3. Restaurant operators also remain generally optimistic about the direction of the overall economy. Thirty-seven percent of restaurant operators said they expect economic conditions to improve in six months, down slightly from 39 percent last month. In comparison, only 11 percent of operators said they expect economic conditions to worsen in the next six months, matching the proportion who reported similarly last month."

MP: The Restaurant Performance Index has remained above 101 for two consecutive months (in December and January) for the first time since late 2006.  In other positive news today, the AP reported today that:

"The U.S. economy started the year off well with busier factories, higher retail sales, more jobs and growth in home sales. The Federal Reserve said Wednesday that all 12 of its banking districts reported some level of growth in January and the first half of February. Manufacturing output rose in all districts, and auto manufacturing, steel makers and other metal producers all reported especially solid growth.

Home sales increased in at least half of the districts, a notable improvement from the Fed's last report in January. Sales are expected to climb further in four districts. And six districts reported rising construction of apartments."

5 Comments:

At 2/29/2012 7:52 PM, Blogger Craig Howard said...

I would rather see how much these restaurateurs plan to invest in expansion than hearing how good their sales are. The latter is not a reliable indicator of the former.

 
At 2/29/2012 8:57 PM, Blogger juandos said...

"I would rather see how much these restaurateurs plan to invest in expansion than hearing how good their sales are. The latter is not a reliable indicator of the former"...

Yeah, just how much are these folks going to invest/bet the future is the real question...

Maybe if the Beige book took into account the price of petroleum and finished produts the beige would have a little more red in it...

 
At 2/29/2012 9:06 PM, Blogger Mark J. Perry said...

From the full report:

"Along with a positive outlook for sales and the economy, restaurant operators also continue to plan for capital spending in the months ahead. Fifty percent of restaurant operators plan to make a capital expenditure for equipment, expansion or remodeling in the next six months, the second consecutive month with at least half of operators planning to make capital investments."

 
At 2/29/2012 9:37 PM, Blogger juandos said...

OK Mark, that update is helpful...

Thanks...

 
At 3/06/2012 11:46 PM, Blogger dany chandra said...

Thanks for showing restaurant performance...
restaurant equipment for sale

 

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