NWA restaurant expansion continues despite weaker industry outlook

Consumers got a little relief in their wallets in recent months from a dip in gas prices and lower utility bills from the cooler-than-normal summer, but they didn’t spend that extra money eating out, according to the most recent restaurant indicator.

Softer customer traffic and a lack of optimism among restaurant operators resulted in a moderate decline in the most recent National Restaurant Association’s Restaurant Performance Index (RPI).

The RPI slipped nearly 1% to 101.0 compared with the RPI in August, which measures current trends as well as expectations of restaurant operators for the next six months. The Current Situation Index was 101.0 in September – down nearly 1% from August 2014 – and the Expectations Index fell 1.1% in September to 100.9.

The industry trade group found the expectations index dipped to its lowest level in 11 months in part because of rising food inflation and slower traffic. The group also remains unimpressed by the direction of the U.S. economy.

The biggest concern for restaurant operators is rapidly rising wholesale food prices.
Wholesale food inflation rose 5.1% in September its highest level in three years. That’s being driven by rapid increases in key ingredients such as butter, up 36% and eggs which are 20%, while beef is 16% higher.

WIth that, menu prices rose 2.1% on average in the month of September as operators try to pass along some of the inflationary costs they have felt in recent months.

NO SLOW DOWN IN NWA
The national reports about the industry have not deterred interest in new restaurant expansion in Benton and Washington counties. There has been a flurry of new permit inquiries made with the state health department in the past two months. Local operators have not slowed their restaurant expansion across Northwest Arkansas despite the weaker outlook. J.J.’s Grill recently opened a new location in Bella Vista, giving the local chain four locations in the region and one in Conway.

Moe’s Southwest Grill has requested permits from the Arkansas Department of Health for a new restaurant at 2600 Pleasant Crossing Drive in southwest Rogers.

A new restaurant with the name Dolivo has filed for a food service permit at 217 S. Main Street in Bentonville. This state health department permit was approved Oct. 2. Dana Davis, CEO of the Bentonville-Bella Vista Chamber of Commerce, said the city continues to welcome more unique eateries that are garnering national attention.

Deluxe Burger also received a new food service permit for a new eatery in Rogers at 5001 Pauline Whitaker Parker, Suite 130, near the Walmart AMP and Chuy’s, the Austin, Texas-based Tex-Mex restaurant that opened in January. Also coming soon to the area will be Pei Wei Asian Dinner whose permit was filed in August and awaits final review when the shopping center is completed. Pei Wei Asian is slated for 4895 W. Pauline Whitaker Parkway.

Four Corners Kitchen requested a permit for a new restaurant at 1214 N. Garland Ave. in Fayetteville. The permit status is open and sent to food service on Oct. 17, according to the state’s website.

Dickey’s BBQ obtained a provisional permit for a new restaurant at 2576 W. Sunset Ave. in Springdale. The Texas-based BBQ eatery already has four restaurants in the region — Lowell, Rogers, Fayetteville and Siloam Springs.

Springdale also recently welcomed a new McDonald’s at Elm Springs Road near the new Walmart Supercenter. This marks the 32nd Northwest Arkansas restaurant for Bill and Walter Mathews. Bill began his career as a burger flipper at McDonald’s in Fayetteville while attending the University of Arkansas. From there Mathews said he had the chance to buy a franchise in Springdale and he brought in his brother Walter for additional financial and operational support. The tandem has never looked back as they run largest restaurant franchise operation in the region.