US consumers made approximately 61 billion visits to restaurants in the year ending May 2014, and that figure hasn't changed significantly. NPD is forecasting miniscule growth in restaurant traffic — less than 1 percent annually over the next several years.
“There are some fundamental shifts in how consumers, particularly low and middle-income consumers, address their discretionary spending,” said Bonnie Riggs, NPD’s restaurant industry analyst. “Similar to the stalled growth other retail sectors are experiencing, restaurants are being negatively impacted by a large segment of the population who are watching their discretionary spending closely. Going to a restaurant is a nice-to-have and not a need-to-have. ”
NPD noted a variety of trends at work in the foodservice segment. Visits to mid-scale/family dining and casual dining restaurants have been in decline since before the recession, according to NPD research. Lunch and dinner dayparts, which represent two-thirds of all industry visits, have experienced traffic declines over the past several years.
Additionally, consumers, ages 25-49, dropped a total of 44 annual visits per person over the last three years. More recently, visits to hamburger quick-service restaurants have slowed, falling 2 percent in the year ending May 2014.
But foodservice options that are doing well offer less expensive options, save consumers money or offer perceived value, NPD reported. Visits during the breakfast daypart have increased during the last three years, while traffic driven by deals or discounts gained 5 percent in the year ending May 2014 period. Non-deal visits declined 2 percent. Also, fast-casual quick service restaurants continue to see traffic growth.
“The restaurant industry is not going to see the strong growth it did prior to the recession in the near future. Consumer attitudes and behaviors have changed and may have changed for good,” Riggs said. “Margins are being squeezed and it’s a battle for share, but the fact remains that US consumers still make billions of visits to restaurants each year. It’s a matter of staying in touch with the reasons why they visit and providing them the experience they want when they do eat out.”
