Now Accepting Restaurant Sales Growth: Will the Industry Rise?
Party of five, your table is ready! Now we’re talking: After nearly a year of consecutive negative restaurant sales growth, the industry experienced a jump in sales, breaking its 10-month-long record of decline. But what contributed to the growth and, more important, will it last?
According to a report from FSR magazine, January saw a national increase of 4.3% in restaurant sales growth, which was also the largest monthly sales spike in the past four years. This stat from TDn2K represents more than 25,000 restaurants and 130 brands.
Going local: CNBC noted that independent eateries are increasing sales with their “unique offerings, local orientation, and strong value.” Additionally, quick-service chains are also faring well. Overall, “fast casual” is leading the way.
So what made the spike? There are reasons like weather (which often creates fluctuations in winter sales), but January 2017 also experienced rare events, like the massive marches following the presidential inauguration and two federal holidays.
It’s also worth noting that restaurant turnover continues to be problematic for the industry. In just December 2016 alone, restaurants experienced another increase in hourly employee and manager turnover rates. FSR magazine reports that more than half of managers who left accepted a position at another restaurant.
However, it was noted that wages and salaries increased in the second half of the year as well. An economist from TDn2K reported that consumer spending was generally solid in 2016 and bodes well for an even stronger 2017, including in the hospitality industry. Time, and platters of appetizers, will tell.