Independent restaurants face declining traffic
CHICAGO – Independent restaurants have steadily lost traffic share to restaurant chains, according to a report from market research firm, The NPD Group.
Restaurant industry visits declined to 60.6 billion in 2011 from 62.7 billion in 2008, and independent eateries accounted for 87 percent, or 2 billion, in traffic losses, NPD said. Independent restaurants represent 28 percent share of industry traffic in the year ending November 2008, NPD said. Currently, that figure is 27 percent. Visits to independent restaurants eased 2 percent from the fall of 2012. More than 7,000 independent restaurants have closed since 2008.
“Independent restaurant operators have neither the money nor resources that the chains have,” says Bonnie Riggs, NPD restaurant industry analyst. “They lacked the marketing power to drive traffic and the monetary buffer to get through the difficult times during the past several years.”
In contrast, chain establishments have had a stronger performance during the recession and recovery compared to independents. Total restaurant industry traffic for the year ending November 2011 was flat compared to the same year-ago period, according to NPD. However, visits to chain restaurants advanced 1 percent. Also, restaurant chains have maintained their share of visits, and gained the independent restaurants’ 1 percent share loss. This represents an increase in share from 60 percent in 2008 to 61 percent in 2011, according to NPD’s CREST service, which tracks consumer use of foodservice.
While independent restaurants have lost numbers, chains have grown by 4,511 units, according to NPD’s ReCount, a biannual count of US restaurants.