Foodservice
While consumers are still closely watching their spending, U.S. restaurants will see sales increase modestly this year, according to the National Restaurant Association’s annual forecast.
Restaurant sales are pegged at $632 billion in 2012, more than $20 billion greater than 2011, according to the forecast from the Washington, D.C.-based association.
Four out of ten Americans want to eat out more than they do currently, according to the association’s research.
“As their cash-on-hand situation improves and the employment situation improves (Americans’) patronage patterns will definitely improve,” said Hudson Riehle, senior vice president of the association’s research and information services division, in a Feb. 1 online news conference on the report.
The sales increase for restaurants in 2012 is forecast at 3.5%, while menu price inflation is pegged at 2.7%. Real growth for the industry will be 0.8% in 2012, which will mark the third consecutive year of real growth for the industry.
Menu prices increased 2.4% last year, compared with a 5% rise in grocery store price in 2011.
Top worries for restaurant operators for 2012 are food costs, building and maintaining sales volume, and the economy, Riehle said.
Because of the competitive environment, restaurant operators are hesitant to fully adjust food costs to reflect wholesale price inflation, he said.
“One of the top challenges for restaurant operators now is obviously what is going on with wholesale food price inflation,” Riehle said. The 2011 wholesale inflation was up 8%, the highest rate of increase in 30 years. This year, the rate of inflation is expected to decline to 4% in 2012.
“From an operator perspective, the continued sizeable gains in wholesale price inflation do put pressure on pretax profit margins and the focus from an operator perspective on productivity, efficiency and effectiveness are much more important,” he said during the conference.
California is the top state with restaurant sales at $63 billion, followed by Texas with $38 billion, New York at $32 billion and Florida at $31 billion.
The full service segment of the restaurant industry is forecast to grow 2.9% in 2012, while quick service (fast food) sales are forecast up 3.1%.
Over a 40-year period, he said the industry has posted an average annual compound growth rate of 6.6%, but the growth rate over the past five years is only about 3%. Currently, about 48 cents of every food dollar is spent in restaurants.
About 970,000 restaurants will purchase $225 billion worth of food and beverages in 2012, he said.
Riehle said restaurants are raising their profile to appeal to social media users.
“We will see more and more restaurants focusing their efforts on promotional marketing and social media,” he Riehle said.
Two out of three 18- to 44-year-olds said they would be likely to use a smart phone application to view a restaurant menu or make a reservation, Riehle said.
“For these individuals, the integration and utilization of technology is an expectation,” he said.
Top food trends for 2012, include locally sourced meats and seafood, locally grown produce, healthful kids meals, hyper-local food (grown on site) and sustainability as a culinary theme.
NRA research indicates that 72% of consumers are trying to eat healthier when dining out, and about the same percentage express a preference for a restaurant that sources food locally.
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