Nearly three quarters of restaurant operators reported sales growth in April, fueling an increase in the National Restaurant Association’s Restaurant Performance Index for the month.
The RPI, a monthly snapshot of the health of the restaurant industry, rose 0.5 percent in April, to 102.7, the NRA said Friday, continuing a run of strong growth. It was the 26th straight month that the index was above 100, which the NRA considers to be a benchmark signifying industry growth.
The index has also been above 102 for seven straight months — despite “some choppiness” in some indicators recently, said Hudson Riehle, senior vice president of the NRA’s research and knowledge group.
“This was driven by consistent majorities of restaurant operators reporting positive same-store sales, as well as an optimistic outlook for sales growth in the months ahead,” Riehle said in a statement.
The RPI consists of two separate indexes: a Current Situation Index and an Expectations Index.
The Current Situation Index was 102.9 in April, a 1-percent increase from March, and its highest level in four months. According to the NRA, 71 percent of operators reported higher same-store sales in April, rising from 62 percent in March.
Thirteen percent of restaurant operators reported a same-store sales decline in the month, falling from 24 percent who reported a decline in March. The numbers suggest that sales have accelerated now that poor weather is less of a factor this spring.
Traffic has also improved. Fifty-five percent of operators reported higher traffic in April, rising from 45 percent in March, while 25 percent reported a decline, falling from 34 percent in March.
Operators also have strong expectations for sales in the coming months. Fifty-two percent of operators said they expect higher sales in six months, a decrease from 59 percent in March. Six percent of operators expect a decline, an increase from 3 percent in March. However, those remain strong expectations. The NRA’s Expectations Index was 102.5 in April, essentially unchanged from 102.6 in March.
Restaurant operators are not quite as bullish about the economy, as only 28 percent of operators expect economic conditions to improve over the next six months, a decrease from 35 percent in March. Thirteen percent expect conditions to worsen, while 59 percent expect conditions to remain the same.
Still, operators are spending on capital improvements. According to the survey, 59 percent of operators plan to make a capital improvement in the next six months, rising from 53 percent in March. Fifty-six percent of operators said they spent on equipment or expansion over the past three months.
The RPI is based on responses to the NRA’s Restaurant Industry Tracking Survey, fielded monthly among restaurant operators nationwide.