“The September decline in the RPI was due in large part to a dampened outlook among restaurant operators for business conditions in the months ahead,” said Hudson Riehle, senior vice-president of the Research and Knowledge Group for the NRA. “Restaurant operators remain unimpressed about the direction of the economy, with elevated food costs remaining at the top of their list of challenges.”
The RPI features two components: the current situation index (CSI) and the expectations index (EI). The September EI fell 1.1 percent from August. Restaurant operators remain generally positive about sales gains in the coming months. Forty per cent of restaurant operators said they expect to have higher sales in six months (compared to the same period in the previous year), down slightly from 45 percent who reported similarly last month. Eight per cent of restaurant operators expect their sales volume in six months to be lower than it was during the same period in the previous year, up from 5 percent in August.
While restaurant operators are relatively optimistic about sales growth, their outlook for the economy remains mixed. Twenty per cent of restaurant operators said they expect economic conditions to improve in six months, while 19 percent expect the economy to worsen. The remaining 61 percent expect economic conditions in six months to be about the same as they are now.
The CSI fell 0.8 percent in September to 101. A majority of restaurant operators reported higher same-store sales for the seventh consecutive month. Sixty-three per cent reported a same-store sales gain between September 2013 and September 2014, essentially unchanged from the 62 percent who reported higher sales in August.
Only 23 percent of operators reported a same-store sales decline in September, up slightly from 21 percent in August.
In contrast, restaurant operators reported somewhat softer customer traffic results in September. Forty per cent of restaurant operators reported an increase in customer traffic between September 2013 and September 2014, while 33 percent reported lower customer traffic. In August, 45 percent reported higher customer traffic, while 31 percent reported a decline.
The RPI is based on the responses to the NRA’s Restaurant Industry Tracking Survey, which is fielded monthly among restaurant operators nationwide on a variety of indicators including sales, traffic, labor and capital expenditures.