NPD Expects Restaurant Traffic Will Grow 1% in Late 2010, Early 2011

The NPD Group, which tracks foodservice traffic activity through consumer panels, reported in December that overall restaurant traffic in the third quarter improved to flat, after two full years of quarterly declines versus year prior quarters. A 1% increase in quick-service traffic, which accounts for more than three-quarters of all restaurant visits, overcame continuing declines in other commercial segments.

The Port Washington, N.Y.-based research firm also forecasts that the restaurant market will finally see overall growth in traffic in the fourth quarter 2010 and the first quarter of 2011. The forecasts were made before the inclement weather in the East and West Coasts in December undoubtedly suppressed some foodservice activity.

Bonnie Riggs, restaurant industry analyst at NPD, said unemployment continues to be an issue that is keeping the industry from “full recovery,” especially among young adults who are the most frequent user of restaurants. Unemployment has also severely affected certain noncommercial segments such as business and industry, vending and recreation. Overall noncommercial traffic, which NPD also tracks, was still off 6% in the third quarter versus ’09’s third quarter, when noncommercial traffic fell 10%.

But Riggs said “Some of the areas most affected by the recession have stopped declining or are starting to edge back up.” She cited family and non-deal visits as areas of improvement. And while casual dining traffic remained negative at -2% and midscale traffic was off 3%, NPD does expect the overall trends to lead to restaurant traffic growth.