May 30, 2005
RPI Inches Up in April
The National Restaurant Association’s Restaurant Performance Index rose by 0.1% in April, reaching 102.2.
A reading of more than 100 indicates expansion, while anything less indicates the industry is contracting.
Based on a survey of foodservice operators, the index is a monthly barometer of the health of the U.S. restaurant industry. It consists of two portions: the Current Situation Index and the Expectations Index.
April’s increase is due to an up-tick in the Current Situation Index, which grew in April by 0.3% to 101.2.
Much of this increase is attributable to surveyed operators’ same-store sales results. Approximately 57% of those surveyed reported higher same-store sales in April compared to the same period a year earlier. About 28% reported a decline in their same-store sales.
Surveyed operators also reported heavier customer traffic, with 47% saying that traffic in April 2005 was heavier than in April 2004. In March, only 43% of respondents made that claim.
While the Current Situation Index improved in April, some of its gains were offset by a decline in the Expectations Index, which fell by 0.2% to 103.0. This decline is due primarily to operators’ concerns about overall business conditions in six months.
This pessimism, however, was not fully reflected in expectations and plans for their own businesses. According to the study, 60% of operators expect higher sales volumes in six months than they are now, while just 10% expect lower sales. These figures are unchanged from the previous RPI survey.
Similarly, 62% of respondents said they plan to make a capital expenditure on equipment, expansion or remodeling in the next six months, a figure that is also unchanged from last month.
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