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Restaurant Visits Take Biggest Dip in 28 Years

From Elissa Elan of Nation's Restaurant News: Restaurant industry guest traffic fell 2.6 percent for the quarter ended May 31, the largest decline since 1981, as consumers continued to cut spending and families with children reduced dining out, a report by market research firm The NPD Group said Monday.

The traffic decline is compared with an increase of 0.5 percent during the same quarter a year earlier, NPD officials said.

The newest report blamed the restaurant traffic decline mostly on reduced visits among parties with children, which typically represents one-third of all industry traffic. NPD’s Consumer Reports on Eating Share Trends said that more than half of the industry’s decline in the May quarter could be traced to fewer dinner visits from parties with children at restaurants throughout all industry segments. Restaurant visits by adults in households without children remained stable in the May quarter, NPD said.

Rising unemployment also took its toll on consumer spending, the report showed.

“The commercial foodservice industry has been struggling since last fall, and it appears that as unemployment increases the struggle is increasing,” said Arnie Schwartz, president of U.S. foodservice for NPD.

According to the report, guest traffic was down 2 percent at quick-serve restaurants, 4 percent at casual dinnerhouses and 6 percent at family-dining operations.

The biggest decline was felt during the dinner daypart, where most consumers pulled back on visits to both quick-service and full-service restaurants, the report indicated. Breakfast and lunch also declined, but those served at quick-service outlets fared better than their full-service counterparts.

Looking forward, Schwartz said that operators that utilize coupons, offer value meal deals and re-engineer menus will have better luck in attracting consumers.

“It’s going to take continued innovation, creativity and perseverance to capture share in a market where the pie may not be growing in the near term,” he said.

For the May-ended quarter, NPD said that restaurant industry check averages rose 2 percent, compared with the same quarter last year, suggesting that diners are willing to spend about the same on a restaurant meal as in the past, but are reducing the number of times they do it. The higher check average was unable to offset the steep decline in foot traffic, so total restaurant spending fell 1 percent across the industry, NPD said. Nations Restaurant News

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