Industry Outlook Remains Positive Despite Dip in RPI

Published on Monday, March 05, 2012

Written by The Editors

Restaurant operators reported positive same-store sales for the eighth consecutive month.

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 101.3 in January, down from December's strong level of 102.2. Despite the decline, January represented the third consecutive month that the RPI stood at more than 100, which signifies expansion in the index of key industry indicators.

The Current Situation Index, which measures current trends in four industry indicators (same-store sales, traffic, labor and capital expenditures), stood at 100.6 in January — down 1.5 percent from December. Despite the drop, this marked the third consecutive month the Current Situation Index exceeded 100.

Key data points from the January 2012 Current Situation Index include:

• Fifty-six percent of restaurant operators reported a same-store sales gain between January 2011 and January 2012, while only 26 percent reported a same-store sales decline.
• Forty-six percent of restaurant operators reported higher customer traffic levels between January 2011 and January 2012, while 30 percent reported a traffic decline.
• Forty-two percent of operators said they made a capital expenditure for equipment, expansion or remodeling during the last three months, the lowest level in 10 months.

The Expectations Index, which measures restaurant operators' six-month outlook for four industry indicators (same-store sales, employees, capital expenditures and business conditions), stood at 102.1 in January — essentially unchanged from December's level of 102.3. In addition, January marked the fifth consecutive month that the Expectations Index exceeded 100.

Key data points from the January 2012 Expectations Index include:

• Fifty-three percent of restaurant operators expect to have higher sales in six months, compared to the same period in the previous year. Only seven 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.
• Fifty percent of restaurant operators plan to make a capital expenditure for equipment, expansion or remodeling in the next six months, the second consecutive month with at least half of operators planning to make capital investments.