Restaurant Sales Growth Continues in Negative Territory

For the fifth time in the last six weeks, restaurant sales once again fell into negative territory, but signs of relative improvement showed as the last two weeks fared slightly better, according to Black Box Financial Intelligence’s latest Restaurant Industry Performance Pulse.

For the week ending Jan. 23, Black Box attributed winter weather to some of the sales slowdown in Texas and parts of the Southwest and Midwest. However, traffic continues to be “a greater challenge” for the industry. Traffic growth for the week was the second worst in almost a year, following the worst traffic results in the last year on Jan. 23.

According to the report, the average guest check contributed to traffic weakness. When calculated on a two-year basis, the average check reached a record high during the week.

Despite the slowdown overall, 31 states posted positive sales growth, with the strongest growth seen in the Western region, Southeast, California and Florida. The Midwest, Texas, New York-New Jersey and the Southwest regions experienced the worst sales growth.

As for segments, fine dining, upscale casual and casual dining experienced the biggest recovery in sales growth during the last two weeks compared to the first three weeks of January.

The National Restaurant Association predicts in its 2022 State of the Restaurant Industry report that the industry will reach $898 billion in sales this year, up from $799 billion in 2021 and also up from pre-pandemic levels. However, on an inflation-adjusted basis, real sales for 2022 will remain below 2019 levels in all major segments.