The National Restaurant Association says that customer traffic levels are up–with its Restaurant Performance Index (RPI) hitting a 14-month high in May. The RPI is a monthly composite index that tracks the health of and outlook for the U.S. restaurant industry.
“The May increase in the Restaurant Performance Index was driven by broad-based gains in the current situation indicators, most notably positive same-store sales and customer traffic results,” said Hudson Riehle, senior vice president of the Research and Knowledge Group for the National Restaurant Association. “In addition, restaurant operators remain optimistic about continued sales growth and a majority plan to make a capital expenditure in the next six months.”
A majority of restaurant operators reported higher same-store sales in May, and the overall results were a solid improvement over the April performance. Sixty-three percent of restaurant operators reported a same-store sales gain between May 2012 and May 2013, up from 49 percent who reported higher sales in April. Meanwhile, just 23 percent of operators reported a decline in same-store sales in May, down from 33 percent in April.
Restaurant operators also reported a net gain in customer traffic levels in May. Forty-seven percent of restaurant operators reported higher customer traffic levels between May 2012 and May 2013, while 30 percent of operators said their traffic declined. In April, 36 percent of operators reported an increase in customer traffic, while 40 percent reported lower traffic levels.
Along with the positive sales and traffic results, restaurant operators reported an increase in capital spending activity. Fifty-two percent of operators said they made a capital expenditure for equipment, expansion or remodeling during the last three months, up from 47 percent who reported similarly last month.
The report says that restaurant operators are increasingly optimistic about their sales prospects in the months ahead. Forty-seven percent of restaurant operators expect to have higher sales in six months (compared to the same period in the previous year), up from 41 percent last month and the highest level in nearly a year. In addition, only 8 percent of restaurant operators expect their sales volume in six months to be lower than it was during the same period in the previous year, the lowest level in 12 months.
Restaurant operators continue to plan for capital spending in the months ahead. Fifty-seven percent of restaurant operators plan to make a capital expenditure for equipment, expansion or remodeling in the next six months, down slightly from 59 percent who reported similarly last month.
Restaurant operators are also generally positive on the staffing front in the coming months. Twenty-one percent of operators plan to increase staffing levels in six months (compared to the same period in the previous year), while just 8 percent said they plan to cut positions.
The full report and video summary are available online at Restaurant.org/RPI.