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jCarbonara
Joe Carbonara

Excellence in Experience

In addition to projecting slow but real growth for the foodservice industry in 2018, The NPD Group outlined a handful of attributes that will affect the way consumers use foodservice. Specifically, NPD predicts consumers will remain strapped for time, embrace digital ordering even more and strive to develop a closer relationship with their couches.

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jMartinez
Juan Martinez

Eye on Efficiency

If your new year’s resolution has fallen by the wayside not that the calendar has turned to February, never fear. It is always a good time to explore new experiences and new opportunities to make a difference in the foodservice industry.

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jStiegler
Jerry Stiegler

Restaurant Sales Flat in January, Sales Growth Among Largest Chains Slowed, and the Number of U.S. Restaurants Dipped

U.S. retail sales declined in January while restaurant sales were flat. Rising government price indexes raise fears of higher inflation and interest rates. Technomic reports sales growth among the 500 largest restaurant chains slowed for the second consecutive year. The number of restaurants in the U.S. declined last year. These stories and whole lot more This Week in Foodservice.

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Sales among fast-casual and quick-serve restaurants to grow 4.3 percent, per the National Restaurant Association's 2015 industry forecast. 

While acknowledging this year's operating environment will be a challenging one, the National Restaurant Association projects total restaurant industry sales will total $709.2 billion in 2015, an increase of 3.8 percent over the previous year's level of $683 billion. Adjusting for inflation, the National Restaurant Association projects sales will increase 1.5 percent in 2015. If this comes to fruition, it will mark the sixth consecutive year of real sales growth for the restaurant industry.

Sales at table service restaurants — a segment that includes fine, casual and family dining — are expected to hit $220 billion, an increase of 2.9 percent in nominal terms for 2015 and .6 percent in real terms. Last year, this segment posted a 2.8 percent increase in sales in nominal terms and 0.4 percent in real terms, according to the National Restaurant Association.

Looking at the limited-service segment, the National Restaurant Association projects 2015 sales among quick-serve and fast-casual operators will total $201 billion, an increase of 4.3 percent in nominal terms or 2.1 percent. Sales among snack and nonalcoholic beverage bars will increase 5.2 percent in nominal terms or 3 percent when adjusted for inflation. For cafeterias and grills or grill-buffets, the National Restaurant Association projects a 1.1 percent decrease in nominal terms, translating to a 3.5 percent decline in real terms.

Operators will continue to face a range of challenges, including food costs, building sales volume, and the economy as well as recruiting and retaining employees.

A steadily improving economy and downward trending jobless rate can become a double-edged sword for the restaurant industry by increasing demand for its products and services and intensifying the competition to recruit and retain employees. As a result, labor costs will remain a concern for operators in 2015. In addition, challenges with the Affordable Care Act implementation and minimum wage increases have made a significant impact on restaurant bottom lines, as typically one-third of restaurant sales are spent on labor, according to the National Restaurant Association.

Consumers continue to have substantial pent-up demand for restaurant services: 38 percent of consumers say they are not eating on the premises of restaurants as frequently as they would like and 41 percent say they are not purchasing takeout or delivery as often as they would like, the National Restaurant Association Reports.

"With the economy slowly improving and national employment trending upward, signs are pointing in the right direction for restaurant industry growth," said Hudson Riehle, senior vice president of Research for the National Restaurant Association. "Certain components of the business climate remain a challenge, accelerating industry sales in some regions and putting a damper on them in others, but the overall industry is definitely in a better place now than several years ago."

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