Annual traffic growth at fine-dining restaurants has outperformed other industry segments for the past three years due to several crucial adjustments made during the last recession, according to The NPD Group.
The market research firm’s CREST service found that visits to fine-dining restaurants rose 5 percent in the year ended December 2013, compared with flat traffic in quick service and declines of 2 percent and 3 percent, respectively, in the casual-dining and midscale segments. The fine-dining sector’s traffic grew 4 percent in both 2012 and 2011, compared with low-single-digit decreases in casual dining and midscale and a 1-percent increase in quick service both years.
After two tumultuous years during the height of the recession, including 2009, when the fine-dining segment’s annual traffic fell 13 percent, the industry sector stabilized, with flat traffic in 2010, before starting its steady growth, The NPD Group found.
Bonnie Riggs, restaurant industry analyst for The NPD Group, said upscale restaurants used consumer insights to expand their appeal with things like more casual dress codes and environments, more perceived value, and upgraded menu items, which began to coincide with a wider recovery in business travel.
“Fine-dining restaurant operators are listening and responding to marketplace needs,” Riggs said. “There was a time when many of these restaurants were in such high demand that they decided who could visit and what they would pay. The recession hit, and there was more supply than demand. Fine-dining operators responded by making the changes necessary to appeal to their customer base, and their customers have responded.”
The NPD Group included the caveat that fine-dining traffic makes up only 1 percent of overall restaurant industry visits, compared with 79 percent for quick service and 10 percent apiece for casual dining and midscale. However, spending at fine-dining restaurants accounts for 14 percent of annual restaurant industry sales, The NPD Group found.
The research firm said the average check for visits at fine-dining restaurants was $28.55 in 2013, compared with $13.75 for casual-dining brands and $5.32 for quick-service eateries.