Foodservice Equipment Reports

Full-Service Concepts Continue Turnaround

One of the realities of the Great Recession and its aftermath were years of negative traffic counts and sluggish sales for full-service restaurants and chains. Traffic counts tracked by The NPD Group were negative or at best flat every quarter compared with the year prior for nearly eight years. Same-store sales tracking from research firms including Technomic Inc. showed years of minimal or negative full-service sales gains.

All of that changed in the final quarter of 2014. As we earlier reported (FER Fortnightly), customer counts at casual-dining concepts rose 2% in the three months from September to November, were flat at midscale/family dining and were up 1% at fine dining for the first overall full-service gain in at least six years.

Preliminary numbers on calendar fourth-quarter chain same-store sales from Technomic show 36 full-service chains reporting a weighted average gain of 4.33%, after a 2.2% rise in the 3Q and only 0.35% in the 2Q. They outperformed same-store sales gains by 27 reporting limited-service chains, which were up 2.66%, if one includes McDonald’s. Without McDonald’s, which has been struggling, LSR chains were up 4.72%.

Joe Pawlak, v.p. at Technomic, tells FER Fortnightly that several factors are behind the change. “First of all, the general economy is improving and transitional customers—those consumers whose spending on going out to eat is impacted greatly by even small changes in discretionary income—are doing better. They are going out to eat more often. Lower gas prices are also helping a bit.”

The better times for full-service operators appear to be continuing into the first quarter. The MillerPulse chain index, reported in Nation’s Restaurant News, showed casual dining up 2.4% in February after a strong January, outpacing limited-service chains’ same-store sales growth in both months. Fine dining was up by double digits in February, the service reports.

For information on Technomic research, go to technomic.com. For foodservice research from The NPD Group, visit npd.com. The MillerPulse information can be accessed here.

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