A new study from the market analysis firm NPD Group reveals there were 4,000 fewer restaurants in the U.S. this past spring than in the spring of 2008. With half its total business in the foodservice sector, this is bad news for the meat and poultry industry – but it could be worse.

"This is for sure the toughest economic environment the restaurant trade has faced in decades," Annika Stensson, spokeswoman for the National Restaurant Association, told MEATPOULTRY.com. "But in our new Restaurant Performance Index, 26 percent of the operators surveyed said they expect economic conditions to improve in the next six months, and the industry isn’t shedding as many jobs as it was in the past. So there are glimmers of hope, at least."

Still, times are indeed tough in the restaurant business. The NRA doesn’t track restaurant openings and closings, but its just-released Restaurant Performance Index for June -- a monthly composite index that tracks the health of and outlook for the U.S. restaurant industry – stood at 97.8 in June, down 0.5 percent from May and its 20th consecutive month below the steady-state level of 100. According to NRA: "Restaurant operators continue to report soft same-store sales, with June representing the 13th consecutive month of sales declines. Only 22 percent of restaurant operators reported a same-store sales gain between June 2008 and June 2009, down from 26 percent who reported a sales gain in May and the lowest reading in the seven-year history of the RPI. Sixty-one percent of operators reported a same-store sales decline in June, up slightly from 60 who reported negative sales in May."

Stensson said that while it’s difficult to make accurate generalizations due to the complexity of the industry, in general the top-end restaurants are being hit the hardest, with a gradually declining rate of economic difficulty as the scale slides downward to the lower-priced operators. "Generally, the lower the check, the better the restaurant is doing right now," she commented. "Consumers are looking for value."

The NPD data shows that overall, the number of restaurants in the U.S. has declined one percent. The hardest-hit are independent operators of fine-dining establishments, whose numbers declined seven percent. Mid-size and smaller fine-dining chains declined six percent. Family restaurants also declined in number in the five-six percent range for mid-size and smaller chains. Overall, the number of quick-service restaurants held steady, though the numbers of independent QSRs dropped two percent. Casual-dining restaurants also held steady overall.

"It’s clear that independent restaurants and smaller chains have been most impacted by the slower economy," said Susan Kleutsch, director, product development-foodservice at NPD. "The recession appears to have weeded out restaurants performing poorly prior to the economic downturn, and this seems most true for independents and smaller chains that are likely having a hard time competing with the resources and marketing power of major chains."

In terms of regions, the hardest hit is the West North Central Census Region, where the number of units declined by two percent compared to last spring. On the other end of the spectrum, unit counts were flat in the East South Central, West South Central, Mountain and Pacific regions.

Stensson told MEATPOULTRY.com she isn’t surprised casual-dining chains seem to be doing relatively well. "They have great marketing campaigns and some great specials going on right now that are very attractive. That keeps customers coming in," she said. Independent operators have difficulty competing in an expensive marketing environment, she added.

She advised meat and poultry suppliers to the restaurant industry to "try to have some understanding of the roughness that restaurants are going through right now." She thinks that while restaurants probably won’t switch out beef entrees for lower-cost alternatives – "they’re not going to change their whole concept" – suppliers can help customers by offering attractive deals and new cuts. "Portion control is one way that a lot of operators can trim some costs, and suppliers can really help with that," she added.