Food service optimism

The National Restaurant Association’s Restaurant Performance Index (RPI) – a monthly composite index that tracks the health of and outlook for the U.S. restaurant industry – stood at 100.3 in September, up 0.8% from August.

Also, the RPI rose above 100 for the first time in five months, which signifies expansion in the index of key industry indicators.

"The RPI’s solid gain in September was the result of broad-based improvements among both the current situation and forward-looking indicators," Hudson Riehle, senior vice president of the Research and Knowledge Group for the National Restaurant Association, said in a statement. "Restaurant operators reported positive same-store sales and customer traffic levels for the first time in six months, which propelled the RPI’s Current Situation Index to its highest level in nearly three years.”

Riehle also said the survey indicated that restaurant operators are more optimistic about sales growth in the months ahead.

The RPI is constructed so that the health of the restaurant industry is measured in relation to a steady-state level of 100.  Index values above 100 indicate that key industry indicators are in a period of expansion, and index values below 100 represent a period of contraction for key industry indicators.

INDEX STATS
• Restaurant operators reported a net increase in same-store sales for the first time in six months in September. 44% of restaurant operators reported a same-store sales gain between September 2009 and September 2010, up from 38% of operators who reported higher sales in August.

• 38% of operators reported a same-store sales decline in September, down from 43% of operators who reported negative sales in August.

• 38% of restaurant operators reported an increase in customer traffic between September 2009 and September 2010, while 37% of operators reported a traffic decline.

• Despite the improvements in sales and traffic levels, restaurant operators reported a slight drop-off in capital spending levels in recent months. 42% of operators said they made a capital expenditure for equipment, expansion or remodeling during the last three months, down from 44% of operators who reported similarly last month.

• Restaurant operators are more optimistic about an improving sales environment, with 43% of restaurant operators expecting to have higher sales in six months (compared with the same period in the previous year), up from 38% who reported similarly last month.

• Restaurant operators are also more bullish about the direction of the overall economy. 38% of restaurant operators said they expect economic conditions to improve in six months, up from 25% last month and the strongest level of optimism in five months.