NRA Capital Spending Indicator Set Record In July

An important measure of restaurant operators’ capital spending activity hit a record in July, according to the National Restaurant Association. And the record was set not by a little, but by a lot. The percentage of operators that made a capital purchase for equipment or facilities improvements during the past three months reached 72% in July. The index number that reflects the question hit 104.3 on the NRA scale in which any reading over 100 indicates expansion, or in this case, that more operators made a purchase than did not.

The index surged 1.4 points from 102.9 in June, which was also a significant record. The marker had reached 102.0 only twice before in the RPI’s history, which began in June 2002. And those high marks were reached in December 2014 and in May this year.

The RPI’s other capital spending indicator, which tracks operators’ plans for capital spending during the next six months, also surged in July, rising 1.3 points to 103.2; 66% of those surveyed said they planned a capital buy during the period. The 103 number has been exceeded by the forwarding looking cap-ex measure just three times in the RPI’s history, all during 2004. The indicator’s record high was 103.8 in March ’04.

The overall RPI, also led by strong gains in current sales and traffic, rose 0.7 point in July, reaching a healthy 102.7. The complete RPI can be viewed at restaurant.org. The historical RPI data can be found in the NRA’s subscription-based Trendmapper section. “””