Lower same-store sales and declining customer traffic decreased the National Restaurant Association’s (NRA) monthly Restaurant Performance Index (RPI), although the industry remains in a period of expansion.
The RPI for December stood at 101.1, down 0.7 percent from a level of 101.9 in November. The RPI is a measurement of the overall health of the restaurant industry. Any value greater than 100 represents growth, while less than 100 signifies contraction.
The RPI decline was primarily a result of a decline in same-store sales and customer traffic. December’s downturn followed moderate gains in October and November, however, and restaurant operators remain optimistic about business conditions in the upcoming months.
According to the NRA, 38 percent of restaurant operators reported a decrease in customer traffic in December, up from 32 percent who reported similarly in November. Similarly, 31 percent of operators reported a sales decline in December, up from 17 percent who reported similarly in November.
Despite the decrease in sales and customer traffic in December, restaurant operators continue to make invest in their business at a healthy rate. During the last three months, 58 percent of operators have made a capital expenditure for equipment, expansion, or remodeling, up from 53 percent last month.
Restaurant operators are planning for capital spending as 45 percent of operators expect higher sales in six months. Expectations have also shown a 3 percent increase from last month in those who plan to make a capital expenditure looking forward.