Uncertainty Over Future Business Conditions Dampens Restaurant Performance Index


(Washington, DC)As a result of softer customer traffic and a dampenedoutlook among restaurant operators, the National RestaurantAssociation’sRestaurant Performance Index (RPI) fell to its lowest level in nine months.The RPI – a monthly composite index that tracks the health of and outlook for the U.S. restaurant industry – stood at 100.2 in July, down 1.1percent from June and the lowest mark since a reading of 100.0 in October.However, July still represented the ninthconsecutive month that the RPI stood above 100, which signifies continued expansion in the index of key industryindicators.

Although restaurantoperators reported positive same-store sales for the 14th consecutive month in July, results were much softer thanrecent months.Fifty-three percent of restaurant operators reported a same-store sales gain between July 2011 and July2012, down from 61 percent who reported positive sales inJune.In comparison, 36 percent of operators reported lowersame-store sales in July, up sharply from 24 percent inJune.

“Althoughrestaurant operators reported positive same-store sales forthe 14th consecutive month in July, theireconomic outlook for the months ahead continued to soften,” said Hudson Riehle, senior vice president of the Researchand Knowledge Group for the Association.”Only 22 percentof restaurant operators expect economic conditions toimprove in the next six months, the lowest level in 10months.”

“Despite theiruncertainty, roughly one-half of restaurant operators stillplan to make a capital expenditure for equipment, expansionor remodeling in the next six months, which is a positiveindicator for both the industry’s supply chain and theoverall economy,” Riehle added.

posted by Tiffany Haslacker