Foodservice Equipment Reports

In Spite Of Winter Doldrums, NRA’s Cap-Ex Measures Keep Rising

What’s surprising about January’s Restaurant Performance Index from the National Restaurant Association is how little the severe winter weather in much of the country affected sales and traffic. The overall index rose 0.2 point to 100.7, the 11th consecutive month the RPI has exceed 100, the tipping point between expansion and contraction.

Meanwhile, the indicator for equipment spending plans during the next six months hit another post-recession high, with 64% of operators reporting they plan such purchases, up from 61% in the December survey. The Current Situation Index cap-ex marker, a reflection of purchase activity during the past three months, posted a second consecutive strong gain.

The four-component Current Situation Index was flat for the month at 99.5, the second consecutive month it has been below the tipping point in contraction territory. Current same-store sales actually ticked up 0.2 point vs. January 2013 while traffic was off only 0.1 point, much less than one would expect given the brutal winter. The labor component, which measures the number of employees and their hours vs. the year earlier period fell 0.9 point, as operators apparently staffed expecting lighter volume. But the current cap-ex surged 0.9 point for the second consecutive month reaching 101.3, with 57% reporting a purchase, up from 52% in December.

The Expections Index, also made up of four indicators, rose 0.3 point to 101.8, the 15th consecutive month it has stood above 100. The previously mentioned cap-ex marker rose half a point to reach its second consecutive post-recession high at 102.7. The future staffing index also rose 0.5 point while the outlook for same-store sales during the next six months was up 0.4 point to 103, its highest point since June last year. The six-month outlook for business conditions fell 0.2 point but remains above 100 at 100.9.

Thus, the outlook for those selling equipment and supplies remains very positive, especially since noncommercial operators, not tracked in the NRA data, also are beginning to ramp up their capital spending.

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