WASHINGTON D.C. — The outlook for the restaurant industry continued to weaken in March, as the National Restaurant Association's comprehensive index of restaurant activity fell sharply. The Association's Restaurant Performance Index — a monthly composite index that tracks the health of and outlook for the U.S. restaurant industry — stood at 97.9 in March, down 0.9 percent from February and its lowest level on record.
The Restaurant Performance Index is based on responses to the National Restaurant Association's Restaurant Industry Tracking Survey, which is fielded monthly among restaurant operators nationwide on a variety of indicators including sales, traffic, labor and capital expenditures. The RPI consists of two components — the Current Situation Index and the Expectations Index.
"The March decline in the Restaurant Performance Index was the result of broad-based declines in both the current situation and expectations indicators," said Hudson Riehle, senior vice president of research and information services for the Association. "Six out of the eight indicators declined in March, signifying both a slowdown in current industry performance as well as a weakening in the outlook for the industry in the months ahead."
Index values above 100 indicate that key industry indicators are in a period of expansion, while index values under 100 represent a period of contraction for key industry indicators.
The Current Situation Index, which measures current trends in same-store sales, traffic, labor and capital expenditures, stood at 97.1 in March — down 1.5 percent from February and its lowest level in more than five years. In addition, March marked the seventh consecutive month below 100, which signifies contraction in the current situation indicators.
The Expectations Index, which measures restaurant operators' six-month outlook for same-store sales, employees, capital expenditures and business conditions, stood at 98.8 in March — down 0.3 percent from February and its lowest level on record. In addition, March represented the fifth consecutive month in which the Expectations Index stood below 100.
