Monday, April 30, 2012

March Restaurant Performance Index and Census Retail Sales Data Signal Ongoing Improvements

"Driven by solid same-store sales and traffic results and an increasingly bullish outlook among restaurant operators, the National Restaurant Association’s Restaurant Performance Index (RPI) matched its post-recession high in March. The RPI – a monthly composite index that tracks the health of and outlook for the U.S. restaurant industry – stood at 102.2 in March, up 0.3 percent from February and equaling its post-recession high that was previously reached in December 2011 (see chart above). In addition, the RPI stood above 100 for the fifth consecutive month in March, which signifies expansion in the index of key industry indicators.

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 102.4 in March – up 0.4 percent from February and the strongest level in 15 months. March also represented the seventh consecutive month that the Expectations Index stood above 100.

Fifty-six percent of restaurant operators plan to make a capital expenditure for equipment, expansion or remodeling in the next six months, up from 49 percent last month and the strongest level in more than four years."

MP: Further evidence of an improving outlook for U.S. restaurants is provided by Census data showing that sales for "Food Services and Drinking Places" were up by 6.6% in March from a year earlier, following a 9.3% increase in February.  After being flat in 2008 and 2009, sales at "food services and drinking places" are now about 16% above the June 2009 level when the recession officially ended.

Moreover, the retail sales at "Full Service Restaurants" were up by 13.6% year-over-year in February following a 10.75% increase in January. The relevant data suggest that the restaurant industry has made a full recovery from the recession and is now operating back above pre-recession levels. 


At 4/30/2012 1:04 PM, Blogger Methinks said...

And yet....stimulus has not yet been recalled. So much for "temporary".

At 4/30/2012 1:07 PM, Blogger Jon Murphy said...

You did say this in your post, Dr. Perry, but I think it deserves to be said again:

Retail Sales of Eating & Drinking Establishments as well as Full Serve Establishments are at record levels, even after adjusted for inflation.

That's a good job.

Another bit of news while we're on the topic of food: Retail Sales of Grocery Stores, adjusted for inflation, are not only at record levels, but are growing at the fastest pace in 18 years (y-o-y).

At 4/30/2012 1:35 PM, Blogger morganovich said...

not sure what the seasonality is in this series, but this release shows that both same store sales and customer traffic were lower in march than feb.

given that SSS are nominal, wouldn't that imply an even larger real drop?

At 4/30/2012 1:56 PM, Blogger juandos said...

'Ongoing improvements' or increasing numbers of people like myself that are to lazy to want to cook and then wash the dishes afterwards?...:-)

At 4/30/2012 2:34 PM, Blogger rjs said...

The Current Situation Index is a composite index based on four ‘recent-period’ restaurant industry indicators:
Same-Store Sales: Compares same-store sales volume in the reference month versus the same month in the previous year
Customer Traffic: Compares customer traffic in the reference month versus the same month in the previous year
Labor: Compares the number of employees and the average employee hours in the reference month versus the same month
in the previous year
Capital Expenditures: Measures capital expenditure activity during the three most recent months

At 4/30/2012 2:38 PM, Blogger morganovich said...

pmi dropped 6 points (though remained in expansion) and the bea's consumer spending figure was up 0.3% from a month ago, the same as cpi was indicating no real growth.

claims numbers remain back up near 390k.

all in all, this seems to support the "weather payback" thesis in which some economic activity got pulled forward due to a warm winter but that we are currently seeing some slowing as that evens out.

i think the economy remains in a stall speed muddle.

At 4/30/2012 3:20 PM, Blogger Moe said...

Like panning for gold - sifting through the data trying to find some good news!

"stall speed muddle" - oughta be the tile of my biography.

At 4/30/2012 3:21 PM, Blogger Larry G said...

I don't see that many restaurant closures or cell phone store closures ... people seem to be gung ho on cell phones and eating out.


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