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FE&SFlashNews — 2004-10-04 — News

October 4, 2004

NRA Index Down In August

The National Restaurant Association’s Restaurant Performance Index posted a slight decline in August, marking the sixth consecutive month the study has indicated declining business results.

The RPI for August fell by 0.1% during the month, moving from 102.9 to 102.7.

Based upon a survey of operators, the index is a monthly measure of the health of the U.S. foodservice industry. It consists of two parts: the Current Situation Index, which fell in August, and the Expectations Index, which registered an increase in the latest study.

The Current Situation Index fell by 1.3%, to 103.0 in August, compared to July. Much of this decline was due to a reported drop in same-store sales during the month. Approximately 45% of responding operators noted an increase in same-store sales in August compared to the same period a year ago, while 38% reported a decline. In July, those figures were 57% and 27%, respectively.

In a related area, surveyed customer traffic also fell in August, with 34% of respondents reporting an increase in traffic and 43% reporting a decline compared to the same month last year.

According to the study, 59% of operators reported that they have made capital expenditures for equipment, expansion or remodeling over the past three months.

While the Current Situation Index fell in the most recent study, the Expectations Index posted an increase of 1.1% compared to July, the first time this RPI measurement has risen in five months.

According to the study, 59% of responding operators predict higher sales in six months compared to the same period a year prior, while just 9% anticipate a decline in sales volume. In the previous RPI, those figures were 53% and 9%, respectively.

This optimism is reflected in operators’spending plans, with 62% of those responding to the study saying they expect to make an expenditure on equipment, expansion or remodeling over the next six months, up from 60% in the prior RPI.

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