Although the beginning of this year has been marked by extremes nationwide — from record-breaking cold on one end to severe drought on the other — restaurant-goers seem unfazed by the weather.
In fact, they are not only dining out more but also spending more each time.
According to a report by Nation’s Restaurant News, February marked the eighth consecutive month of growth for same-store restaurant sales in 2014 and early 2015. In fact, data compiled by TDn2K’s Black Box Intelligence — culled from weekly sales reports for more than 20,000 restaurants nationwide — indicates that if the positive sales growth continues, we may see the first three-quarter growth streak in 2 years.
Sales growth reached 2.1 percent in February, according to the report, an approximate 4 percent drop from growth in January. This decrease can be attributed to the weather, claims Victor Fernandez, executive director of insights and knowledge for TDn2K.
“Although this drop could seem to be a sign of weakness for restaurant sales in February, the reality is last month’s results were greatly aided by more favorable winter conditions than were experienced in January of last year, while February was the opposite. February 2015 winter storms were much worse than what was experienced a year ago, negatively impacting sales during the month,” Fernandez told Nation’s Restaurant News.
Fernandez went on to cite February’s distinction as the first month since November 2014 to show negative growth, another indication that the reported drop was due primarily to weather rather than an overall decline in the industry.
Growth in Our Network
Comprising more than 10,000 locations across the country, Rewards Network’s inventory of restaurants, bars, and clubs runs the gamut from longstanding chains to small, local restaurants and first-year startups.
Through our premier dining rewards programs, Rewards Network collects each business’s credit card sales information, giving us unique and in-depth insights into the industry. When added to the empirical data provided by the verified customers reviews conducted by our 6+ million members, we have a unique and comprehensive understanding of the industry as a whole.
This data on our restaurants — segmented into six major categories, including Casual Dining, Family Dining, Fast Casual, Fine Dining, Quick Service, and Upscale Casual — supports Fernandez’s optimistic view of the industry, and then some.
As a whole, our restaurants showed average year-over-year growth three times greater than that reported by TDn2K. And although each segment performed well above TDn2K’s data, a few segments surpassed even those numbers, indicating an important shift in the way consumers are dining.
Quick Service and Fast Casual restaurants — or counter service restaurants that typically provide higher-quality offerings than a traditional “fast food” location — showed approximately six times the growth reported by TDn2K, and more than twice the growth of any other restaurant segment in our inventory. This indicates that although consumers are still frequenting other types of restaurants, they are allocating more of their dollars to these locations in particular.
This increase in the popularity of Quick Service and Fast Casual has not gone unnoticed in the industry, but these data points suggest much more than just an increase in a single segment’s popularity.
Rewards Network’s membership base is increasing all the time — driving more consumers to each of our locations — but that alone likely does not account for these increases. Instead, the data suggests that not only are more consumers visiting each restaurant, they’re visiting more often and spending more per visit than during the same time period last year.
A Bright Future
But these data points aren’t the only indicators suggesting the industry will continue to grow. According to TDn2K’s People Report, the restaurant industry has experienced 15 consecutive months of year-over-year job growth, indicating that hiring is at high.
Turnover rates for both management level and hourly employees are increasing, with 10 consecutive months and 17 consecutive months of growth, respectively — data that rivals that recorded before the recession. This suggests forthcoming growth in wages and salaries for restaurant workers, as well.
This growth is attributed to the improving economic climate and, more specifically, the increase in new restaurant openings over the past several years. In fact, according to Business Insider, restaurants and bars saw greater year-over-year sales growth than any other business segment in January 2015 with an 11.3 percent increase.
Want to learn more about the best metrics to follow for your business? Check out our post on “What You Need to Know About the Restaurant Industry.”