Restaurant Traffic, Other Indicators Trend To Positive

A number of restaurant-activity indicators released during the past couple weeks show a pronounced positive trend for commercial foodservice. Data from The NPD Group on restaurant traffic, First Data, which tracks credit- and debit-card transactions and Knapp-Track, which follows same-store sales, show upward movement. Combined, the reports may indicate the market has finally, clearly turned. As we reported in the last issue of FER Fortnightly, the National Restaurant Association’s Performance Index also turned positive in September.

NPD reported Nov. 10 that restaurant visits by parties with children turned positive in the June-through-August quarter, up 1% versus the summer quarter last year. It was the first traffic gain for parties with kids since summer 2007. “Although the visits increase reflects just one quarter, the return of parties with kids is another sign that business is beginning to pick up,” said Bonnie Riggs, NPD’s restaurant industry analyst.

What’s more, while NPD has not publicly announced commercial traffic numbers for the summer, a look at the graph accompanying the release (see below) appears to indicate adults-only traffic moved up to flat for the first time in the last five quarters, and that overall commercial traffic may have been positive over the summer. If we’re reading the graph correctly, it would be the first positive quarter for restaurant traffic since the summer of ’08.

First Data’s “SpendTrend” report for October said credit- and debit-card spending by consumers rose 9.5% compared with October last year, according to a Nation’s Restaurant News article Nov. 9, verified on First Data’s website. It was the largest one-month increase in more than 18 months, First Data said. Restaurants and bars spending growth significantly outperformed supermarkets and most other retail. Spending in hotels rose 6.9%.

The Knapp-Track analysis of same-store sales for September showed the third consecutive month of gains, with 1.2% rise, according to an NRN article Nov. 1. The three-month upward trend followed 25 consecutive months of declines.

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