The RPI rose for the second consecutive month and stood above 100 for the 14th consecutive month, signifying expansion of key industry indicators, according to the NRA.
The Current Situation Index stood at 101.3 in April, up 0.5 percent from 100.8 in March. The Current Situation Index measures trends in same-store sales traffic, labor and capital expenditures.
A majority of restaurant operators (51 percent) reported gains in same-store sales between April 2013 and April 2014, while 26 percent reported a decline in sales. In March, 55 percent of restaurant operators reported same-store sales gains, while 32 percent said their sales declined.
“The recent rise in the RPI was fueled by improvements in same-store sales and customer traffic, which are back on a positive trajectory after the winter soft patch,” said Hudson Riehle, senior vice president of the Research and Knowledge Group for the NRA. “In addition, restaurant operators have an optimistic outlook for business conditions in the months ahead, which is reflected by the expectations component of the RPI rising to its highest level in two years.”
Capital expenditures continue to grow as 56 percent of restaurant operators said they made capital expenditures for equipment, expansion or remodeling during the last three months, up from 49 percent who reported making capital expenditures last month. Additionally, 60 percent of restaurant operators are planning for capital expenditures for equipment, expansion or remodeling in the months ahead, up slightly from 58 percent last month.
Operators are generally optimistic about future sales gains, according to the NRA. Forty-six percent of operators said they expect to have higher sales in six months, a slight decline from the 49 percent of operators who answered similarly a month ago.
A majority of restaurant operators (55 percent) believe economic conditions will remain generally unchanged in the next six months, while 30 percent of operators said they expect economic conditions to improve during that period. Another 15 percent expect the economy to worsen.