Restaurant Performance Index Rises to Highest Level in Nearly Six Years

January 31, 2012 02:57 AM

The National Restaurant Association’s (NRA) comprehensive index of restaurant activity rose to its highest level in nearly six years in December thanks to an increase in same-store sales. The group's Restaurant Performance Index (RPI) stands at 102.2, up 1.6% from the previous month.


RPI Dec2011

"Aided by favorable weather conditions in many parts of the country, a solid majority of restaurant operators reported higher same-store sales and customer traffic levels in December," said Hudson Riehle, senior vice president of the Research and Knowledge Group for the association.  "In addition, restaurant operators are solidly optimistic about sales growth in the months ahead, and their outlook for the economy is at its strongest point in nearly a year."

The Current Situation Index stood at 102.1 in December – up a solid 1.9% from November and its strongest level in seven years, reports NRA. December also represented the third time in the last four months that the Current Situation Index stood above 100, which signifies expansion in the current situation indicators. 

Meanwhile, The Conference Board's Consumer Confidence Index, which is also tracked to gauge meat demand, unexpectedly retreated in January. The index strengthened in December to 64.8, but now stands at 61.1.

Lynn Franco, director of The Conference Board Consumer Research Center said, "Consumers' assessment of current business and labor market conditions turned more downbeat and is back to November 2011 levels. Regarding the short-term outlook, consumers are more upbeat about employment, but less optimistic about business conditions and their income prospects. Recent increases in gasoline prices may have consumers feeling a little less confident this month." 

Juli says: The surge in the RPI in December is good news for the meat industry, as it reflects positive consumer attitudes toward the economy. But if the Consumer Confidence Index continues its decline, it will cause reason for concern.

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