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CHICAGO -- Customer visits to U.S. restaurants and foodservice outlets remained negative in the quarter, ended June 30, resulting in six consecutive quarters of weak traffic performance, according to NPD Group . The U.S. foodservice industry has not experienced six quarters in a row of no traffic growth since the recession of 2008-09, the Chicago-based research firm reported. The average check at foodservice outlets rose by 2.6% -- the largest increase in several years -- reflecting higher menu pri...
August 24, 2017
CHICAGO -- Customer visits to U.S. restaurants and foodservice outlets remained negative in the quarter, ended June 30, resulting in six consecutive quarters of weak traffic performance, according to NPD Group.
The U.S. foodservice industry has not experienced six quarters in a row of no traffic growth since the recession of 2008-09, the Chicago-based research firm reported. The average check at foodservice outlets rose by 2.6% -- the largest increase in several years -- reflecting higher menu prices.
"No doubt the rising cost of a restaurant meal is weighing heavily on industry traffic performance," said NPD Group restaurant industry analyst Bonnie Riggs. "The vast majority of consumers give restaurants fairly low ratings on affordability compared to other customer satisfaction attributes."
The slowdown in restaurant and foodservice visits is most prevalent at midscale/family dining and casual dining concepts. Midscale establishments registered a 4% decline in traffic in the quarter versus last year's comparable quarter. Casual dining visits dropped by 3% in the quarter, according to NPD's Consumer Reports on Eating Share Trends (CREST) market research.
Visits also softened for quick service restaurants, which represent the lion's share (83%) of industry traffic and have been the only driver of industry traffic growth for several years, according to NPD. QSR customer visits were flat in the quarter compared with last year but a steeper decline was offset by traffic growth at QSR hamburger and fast casual restaurants. The QSR hamburger category reportedly realized nearly 13 million more visits in the quarter than last year, and fast casual grew traffic by 77 million incremental visits.
In addition to QSR hamburger and fast casual restaurants, other industry bright spots in the quarter included the continued growth of morning meal visits, up 1% in the quarter over year ago, and foodservice delivery, up 2%. The quick service segment was primarily responsible for the uptick in morning meal visits. Delivery growth was entirely derived from four restaurant categories: QSR sandwich, QSR burger, midscale and Asian, according to NPD.
"Although there were a few performance bright spots this quarter, these visit occasions are not large enough to move the industry in a positive direction," said Riggs. "Operators will need to be critical in increasing prices and make sure that when they do raise prices the quality of the food and experience is commensurate with their customer's cost."
NPD's CREST research has monitored daily all aspects of how consumers use restaurants and foodservice since 1981. CREST continually tracks more than 400,000 consumer visits per year at commercial and noncommercial foodservice establishments.
