Overall U.S. restaurant industry sales likely to rise 2.8% to US$416.4B in 2012, up from 1.4% increase in 2011, research firm says
April 3, 2012
– According to market-research firm Mintel Group Ltd., overall U.S. restaurant industry sales are likely to rise 2.8% to US$416.4 billion this year, up from an increase of 1.4% in 2011, The Wall Street Journal reported April 1.
Analysts say that although the number of consumers dining out is expected to remain relatively flat, consumers who dine out will likely increase the amount of money that they spend while some will even shift to more expensive restaurants. Analysts warn, however, that gasoline prices remain the great unknown, as rising prices will reduce consumers’ discretionary budgets.
Although many restaurants began offering deep discounts during the recession in order to attract customers, analysts predict that they are likely to raise prices this spring.
Based on a monthly consumer survey aimed at collecting consumer expectations regarding their spending over the next three months, consulting firm Kurt Salmon Associates Inc. predicted that restaurant sales this spring will likely increase. The firm did not specify by how much.
Although overall sales in the U.S. restaurant industry will likely increase, not all sectors within the restaurant industry will benefit equally. Mintel predicted that sales at limited-service restaurants will likely increase 4.1%, up from a growth rate of 3.4% in 2011. Sales at full-service restaurants will likely increase 1.5%, up from an unspecified rate of decline in 2011, Mintel added.
Kurt Salmon retail strategist Todd Hooper said that restaurant chains that focus on fresh ingredients, chains that have invested in remodeling programs, and chains that emphasize their alcoholic beverage selection will likely do well following increases in consumer sentiment.
Technomic Inc. Vice President Darren Tristano said that restaurant closures, which help balance supply and demand, will likely benefit the overall U.S. restaurant industry. Thus far during 2012, roughly 1% of the 560,000 restaurants within the U.S. restaurant industry have closed. Technomic has predicted that U.S. restaurant sales during 2012 will likely increase 3%. This increase will most likely be driven by higher prices as opposed to a higher number of customer visits.
The primary source of this article is The Wall Street Journal, New York, New York, on April 1, 2012