What is in this article?:
- How winter weather is impacting restaurants
- Consumers less pessimistic on economy
Analysts assess how recent storms and record-cold temperatures are affecting consumer dining.
Consumers less pessimistic on economy
(Continued from page 1)
Nicole Miller Regan, a senior research analyst with Piper Jaffray, wrote in a report released Wednesday that December monthly sales at places serving food and drinks rose 4.1 percent in December to $47,571, according to the U.S. Census Bureau. Meanwhile, monthly sales at grocery stores increased 3.8 percent on a year-over-year basis, to $49,360.
“Historically, the dollar gap between grocery stores and foodservice sales had been flattening, with grocery store sales higher than foodservice sales,” she wrote. “Food away from home contributed 49.1 percent of total sales, an increase of 10 basis points compared to last year.”
In a separate report released Wednesday, Miller Regan also cited data from restaurant consulting group and research firm AlixPartners, which said in a recent “State of the Restaurant Industry” webinar that consumers expect to spend about 9 percent less per restaurant meal this year.
After asking consumers what they expect to spend on restaurant meals in the next 12 months, AlixPartners projected the average would dip to $13.55 this year compared with $14.91 last year.
When asked how often they expect to dine out within certain restaurant segments, consumers indicated they expect to eat more often at convenience stores, fast-casual restaurants and fine-dining establishments, compared with the prior 12 months.
Dining at grocery stores is expected to decline, and consumers also say they will eat slightly less often at quick-service and casual-dining restaurants.
Consumers also appear to be less pessimistic about the economy, with 47 percent saying they feel “bad” or “not good” in the first quarter of this year, falling from the 56 percent who said the same two years ago.
More consumers described themselves as neutral about the economy this year — 31 percent versus 25 percent two years ago — indicating a “wait-and-see” position, Miller Regan noted.
As a result, consumers are still searching for value when dining out, she wrote. That trend will only further the “blurring of the lines” between industry segments, Miller Regan argued.
“These trends could help spur the next round of culinary innovation similar to what we saw with the advent of small plates and shareable dishes, which, despite carrying a lower price point versus a typical entrée, proved to be at least margin neutral (and often accretive), as well as an incremental traffic driver,” she wrote.
Despite the weather and continued malaise about the economy, Miller Regan remains positive on the restaurant industry, especially brands that utilize what she calls a “perfect recipe for restaurant success” by having brand equity, deploying asset-light growth and capitalizing on licensing opportunities.
Contact Lisa Jennings at firstname.lastname@example.org.
Follow her on Twitter: @livetodineout