Foodservice Equipment Reports Fortnightly
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Welcome to FER Fortnightly Online Newsletter
April 18, 2006








Regulatory Report:
Sponsored by:
HOSFAIR GUANGZHOU & HOSFAIR XI'AN 2006
Junk Food In Schools Blown Into Federal Case
New Jersey Updating Its Food Code
Smoking Bans: Confusion; Extension; Toothlessness?

Industry Report:
FER Names Industry Service, Dealer Award Winners
It's Registration Time For Supply Managers
D.C. Biker Chefs Ride Against Hunger
Famous Dave's Inks Orange County Franchise Deal
Yum! Brands Opens First Russian Co-Brand KFC
CFESA Announces New Membership Directory



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In This Section:
Higher Income Households Drive Consumer Confidence Surge
NRA's Restaurant Performance Index: Steady Ahead

This issue's Regulatory ReportSponsor: HOSFAIR GUANGZHOU & HOSFAIR XI'AN 2006 Industry Report

Economic Report FER Economic Forecast Meetings

Higher Income Households Drive Consumer Confidence Surge
Households with incomes above $50,000 feel pretty confident, according to the latest Index of Consumer Sentiment reading published by the University of Michigan's Survey of Consumers.

The report, released March 31, put the Index at 88.9, a substantial 2.2-point rise over February's reading. Same period last year, the reading was stronger, at 92.6.

Among households with incomes above $50,000, the Index rose 5.1 points in the current survey. For households below that figure, the Index was off 0.4 points. The disparity between the two groups, we believe, suggests such things as energy pricing and job security are weighing much more heavily on lower income households.

"Upper income households were half as likely as lower income families to report that their financial situation had been significantly weakened by higher prices, and higher income households were three times as likely to anticipate increases in their real incomes during the year ahead," Richard Curtain, director of consumer surveys, said in a written statement.

A future-oriented component of the overall Index, the Index of Consumer Expectations, rose to 76 in March, up slightly from the preceding month but far short of the 82.8 recorded in March of 2005.

Among other findings: Households across all economic levels tend to believe economic growth will cool in the second half of the year. And although survey responses don't suggest a serious downturn anytime soon, half of respondents indicate they expect a downturn sometime within the next five years.

Consumers indicated price discounts would remain important in their purchase decisions for homes, vehicles, appliances and furniture. New residential investment, meanwhile, is expected to decline, and home-equity cash-outs are expected to slow down, according to Curtin.

 

Section sponsored by FER E&S Market Forecast Meetings

NRA's Restaurant Performance Index: Steady Ahead
Good, steady news: The National Restaurant Association's monthly Restaurant Performance Index held unchanged in February at 102.3, the 32nd straight month the Index scored above 100. Above 100 indicates industry expansion; below means contraction.

Most operators responding to the survey reported positive same-story sales for the fourth straight month, significant considering winter weather hampered some markets. Softness in Northeast markets was offset by strength in the South and West.

The two main components of the overall Index, the Current Situation Index and the Expectations Index, both held roughly steady in February. The February CSI, based on same-store sales, traffic, labor and capital expenditures measurements, rose a tenth of a point over January to 101.3.

Interestingly, comparing February to year-earlier figures, operators reporting increases in same-store sales outnumbered those reporting declines by two to one—which we'd interpret as a sign of broad-based health in the industry.



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