Back To News/PR Index | Best Restaurant Industry Sales in Almost Three Years During April | “We are seeing an uptick in restaurant revenue beginning with the fourth quarter of last year,” stated Victor Fernandez, vice president of insights and knowledge for TDn2K. “Stronger economic conditions and high consumer confidence are certainly factors. However, this performance has to be considered against last year’s soft sales. A longer view suggests there are still significant challenges for the industry.” However, with same-store sales positive over a two-year period in April, it could be an early signal that the industry is more vibrant and is showing signs of returning to consistent positive comp performance. As for bad news, it is impossible to ignore the fact that positive sales come from increases in average check while guest counts continue to slide. Same-store traffic was down -1.4 percent in April. Even though this was the best month based on traffic in over two years, it highlights the fact that stopping the erosion in guest traffic remains the industry’s number one priority. Restaurants
Should Continue to Get Fair Share of Tax Cuts
“That personal income is rising modestly, rather than surging, could help the restaurant industry. Households have enough additional funds to spend on a night out, but not enough buy big-ticket items. Thus, we are seeing a slowdown in vehicle purchases while demand for soft-goods and eating out is holding up well. Restaurants should continue to get their fair share, if not more, of the tax cuts. However, the limited portion of the tax cuts going to low and middle-income households points to only a moderate rise in demand going forward.” Check
Growth Continues to Accelerate
TDn2K research has shown that top performing restaurant brands grow average checks at a higher rate than underperformers. There is evidence that top performers have established a value proposition that allows them to pass along cost increases associated with higher operating expenses, especially labor. Opportunity
Areas for Restaurants: Off-Premise and Beverage Sales
Also noteworthy during April was the robust growth in same-store beverage sales. This month’s beverage sales growth was the highest in over 30 months. This is another important metric to follow in the near future. TDn2K studies have revealed guests of both full-service and limited service restaurants really value beverages (either alcoholic for full service restaurants or soft drinks for limited service brands) as part of their restaurant experience. According to TDn2K’s White Box Social Intelligence data, top performing brands based on sales growth tend to have a much more positive guest sentiment based on beverages than underperforming brands. Recovery
Continues for Casual Dining and Fast Casual
Soaring
Turnover Rates May Have Peaked
“There is definitely a reward for getting better staffed restaurants,” continued Fernandez. “Our data shows in the first quarter of 2018, guests’ online mentions revealed that service is a more important differentiator than food. Nowadays, consumers can get a meal from many different sources. But they are saying that service is a key driver of their experience.” TDn2K™ (Transforming Data into Knowledge) is the parent company of People Report™, Black Box Intelligence™ and White Box Social Intelligence™. People Report provides service-sector human capital and workforce analytics for its members monthly. Black Box Intelligence provides weekly financial and market level data for the restaurant industry. White Box Social Intelligence delivers consumer insights and reveals online brand health. TDn2K membership represents 43,000+ restaurant units, 2.5 million employees and over $69 billion in sales. They are also the producers of leading restaurant industry events including the Global Best Practices Conference held annually each January in Dallas, Texas. www.TDn2K.com Media
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