Friday, May 01, 2015

Restaurant Performance Index shows Expansion in March

by Bill McBride on 5/01/2015 07:02:00 PM

Here is a minor indicator I follow from the National Restaurant Association: Restaurant Performance Index Remained Positive in March

As a result of higher same-store sales and a continued optimistic outlook for future business conditions, the National Restaurant Association’s Restaurant Performance Index (RPI) remained in positive territory in March. The RPI – a monthly composite index that tracks the health of and outlook for the U.S. restaurant industry – stood at 102.2 in March, down 0.4 percent from February’s level of 102.6. Despite the decline, March marked the 25th consecutive month in which the RPI stood above 100, which signifies expansion in the index of key industry indicators.

“Although a majority of restaurant operators reported higher same-store sales in March, customer traffic levels were somewhat dampened,” said Hudson Riehle, senior vice president of the Research and Knowledge Group for the Association. “Looking forward, restaurant operators remain solidly optimistic about future business conditions, with six in 10 expecting to have higher sales in six months.”
emphasis added
Restaurant Performance Index Click on graph for larger image.

The index decreased to 102.2 in March, down from 102.6 in February. (above 100 indicates expansion).

Restaurant spending is discretionary, so even though this is "D-list" data, I like to check it every month. This is another solid reading - and it is likely restaurants are benefiting from lower gasoline prices and are having to raise wages - a little - to attract and retain workers.