Restaurant expert reports from July 2013offer a mixed bag of news for owners of restaurants and investors in the industry. Though the short-term news is somewhat negative, the long-term outlook offers reasons to expect improvement in the near future. In the spring months, a period of positive month-by-month growth left owners and investors optimistic that positive trends would continue into the summer, perhaps even growing based on increased tourism traffic. However, that springtime optimism has not translated into summer results, as same-store sales dropped .9 percent in July, lowering the summer total to just .1 percent growth since the promising spring. The drop in same-store traffic has been more considerable, as July saw a 2.2 percent decrease, which was only slightly better than the 2.5 percent decrease seen in June. Ahead are more of the relevant numbers from the latest restaurant analysis, and what that means for the restaurant industry going forward. Room for Optimism The news was not all bad, though. Despite decreases in sales and traffic, this restaurant planning outlook for consumer restaurant spending was actually on the upswing in July. The Consumer Edge Research Restaurant Willingness to Spend outlook registered a value of 93 out of 100 in July, up from an 85 value in June. That number has been trending upward since March of 2013, and the 93 value in July was the highest number the index has registered in 2013. Typically, consumer spending increases in the month following a high rating on this outlook, so odds are that August will be a better month for business than July was. The overall trend for consumer restaurant spending is strong, increasing in every month since March, with the exception of June. Willingness to spend numbers are also up when compared to the same month of last year. Region by Region Even with a drop in same-store sales and traffic overall, some areas managed to show growth in regional restaurant performance for restaurant investments in the latest restaurant expert reports. New England was the best-performing region in July, registering 1.6 percent growth in sales and .7 percent growth in traffic. The Mid-Atlantic region, on the other hand, performed poorly enough to drag some of the overall numbers down on its own, with a 3.7 percent drop in sales and a 4.3 percent drop in traffic for July. The regional restaurant performance numbers were not very promising in July, as one would expect with an overall decline. Only 50 of 182 DMA’s registered positive growth in July, compared to 82 in June. Slight variations in summer performance based on region are to be expected due to increased travel, but the Mid-Atlantic numbers in particular show a surprising lack of growth considering the normal tourist attraction of beach and camping towns. What it Means There is no sugarcoating a decline in overall and regional performance which takes place over the first two months of the summer. The summer months are when many restaurant owners and investors expect especially strong performance, especially those based in summer resort towns, and numbers like the Mid-Atlantic regional performance don’t show that this year. The good news is that consumer spending outlook continues to trend in a positive direction, even with the down-tick in sales and traffic. This shows that even if consumers are not spending their money right now, they have no qualms about doing so in the future. It is also worth noting that even with the summer dip, the industry is not far removed from the positive upward trends in sales and traffic from the spring. Overall, the numbers show a decrease in the present, but offer hope in the form of a positive consumer spending outlook in the near future and positive growth in the recent past. The next restaurant expert reports should give some indication of whether that positive outlook will be realized, and of what to expect in the coming months of autumn.
