The National Restaurant Association’s (NRA) comprehensive index of restaurant activity declined by 0.6% from March to stand at 101.6 in April due to softer sales and traffic. Despite the decline, April represented the sixth consecutive month the RPI stood above 100 -- which signifies expansion in the index of key industry indicators.
But restaurant owners are optimistic traffic will increase in the months ahead. Fifty-two percent of restaurant operators expect to have higher sales in six months (compared to the same period in the previous year), essentially unchanged from the previous four months. In comparison, only 8% of restaurant operators expect their sales volume in six months to be lower than it was during the same period in the previous year, down slightly from nine percent last month.
Earlier this week the Conference Board said consumers' confidence in the economy declined in May, with its index down 3.8 points to stand at 65.9. The board notes that consumers are less optimistic about the short-term outlook, but are more upbeat about their income prospects, which should help sustain spending.
Juli says: It's important the RPI has held above 100 so far this year, but this isn't a stellar report for red meat demand. When dining out, consumers are more likely to pick a higher-quality cut of meat. Without growth in the restaurant industry, this sector for red meat demand remains "stale."