NPD Reports Slow Traffic Growth Weakens Restaurant Expansion

With little growth in consumer visits to restaurants in the United States, restaurant units grew less than one percent (.8%) in the spring 2014 compared to the spring of 2013, according to the NPD Group, a Chicago-based market research and information company. The total US restaurant count stands at 635,494, based on restaurants reported to be open as of March 31, which is up by 5,002 units over the spring of 2013. Restaurant chains contributed to almost 80% of the unit growth, adding 3,718 locations since last year (up 1.%).

Independent restaurant counts stood at 351,359, up 1,284 units, or 0.4% compared to a year ago, based on NPD’s ReCount, which is a tally of commercial restaurant locations in the United States compiled in the spring and fall each year.  Quick service restaurants grew units to 337,667, up 2%, and unit counts for full service restaurants, which include casual dining, midscale/family dining, and fine dining, declined by 2,156 units (down 1%) to 297,827 total units.  

According to NPD’s ongoing foodservice market research, which tracks daily how consumers use commercial and non-commercial foodservice outlets, visits to total and quick service restaurants were flat in the year ending June 2014 compared to the same period during 2013.  Traffic to casual dining and midscale restaurants, both of which are full service restaurants, was down 3% and 4%, respectively.  Major restaurant chain visits held steady, whereas independent restaurant traffic declined by 1%.

NPD’s forecast is for foodservice industry traffic to grow less than one percent annually for the next several years.

“Restaurant unit growth and declines typically correlate to the growth or opportunities within a given segment, category, or even geography,” said Greg Starzynski, director of product management for NPD Foodservice.  “Prior to the recession, when industry traffic was strong and money was more available, the industry expanded units rapidly. But in today’s market unit growth must be a calculated risk.”