July 4, 2005
RPI Shows Slowing Growth in Foodservice Industry
The National Restaurant Association’s Restaurant Performance Index fell by 0.7% in May to 101.4.
The index is based on a monthly survey of foodservice operators and consists of two main portions: the Current Situation Index and the Expectations Index, both of which posted declines in the latest survey. Readings of greater than 100 signal expansion of key industry indicators, while less than 100 indicate contraction.
In May, the Current Situation Index fell to 100.4 from its April level of 101.2. The decline is due largely to a fall in customer traffic. Approximately 36% of operators reported higher traffic in May 2005 than in May 2004, down from 47% who made the same claim in April.
Similarly, compared to the year-ago period 50% of respondents reported higher same-store sales in May, while 32% reported a same-store sales decline. In April, those figures stood at 57% and 28%, respectively.
The Expectations Index declined by 0.5% to 102.5, the lowest level since November 2004. Approximately 54% of operators anticipate higher same-store sales in six months than in the same period a year earlier, while 10% forecast a decline in same-store sales. In the previous study, those numbers were 60% and 10%, respectively.
Operators’ capital expenditure plans also dampened in the latest survey, with 57% saying they plan to make an investment in equipment, expansion or remodeling in the next six months, down by 5% from the previous survey.
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