Above all else, the performance of the restaurant industry is one of the most important pieces of information for restaurant operators to keep track of. Luckily, while customer sales dampened a bit, the industry is closing in on a full year of market expansion, though some aspects of production are below hopefuls' expectations.
Twelve months of growth
According to the National Restaurant Association, its barometer of restaurant performance called the Restaurant Performance Index remained above 100, the point signifying expansion, for the 12th consecutive month in February. While the RPI declined about 0.2 percent that month, the Index has climbed back up to above 100 again.
For the third consecutive month, poor customer traffic was blamed on the continuing sting of bad weather, which affected much of the country over that period of time. In the near future, operators are optimistic about sales gains in the coming months, though they're more reserved about the future of the overall economy.
The RPI has two separate components – one focusing on current trends in different industry indicators and the other centered around hopes for the future. While the Current Situation Index showed results of 99.3, down a fifth of a percent from January, the Expectations Index hovered around 101.7 in the month, down only a tenth of a point. This was the 16th month in a row that restaurant operators were excited about the prospects of the economy for small businesses.
Loyalty programs need better adoption
Despite the improvements in the market, there are still areas of improvement for the average company. A new study from Deloitte found that only 25 percent of consumers consider the importance of loyalty programs when they choose to eat at a restaurant.
Only about a half of survey respondents said they belonged to restaurant programs. That's more than 25 percent less than those who are members of airline programs, and 20 percent lower than those who joined hotel programs.
Nearly 75 percent of respondents don't participate in their favorite restaurant's program, citing reasons such as they don't believe one is offered or they don't know if one's available. However, when awareness is improved, as many as 87 percent of users will belong to a program, one of the highest conversion rates among the whole industry.
Ways businesses can improve their loyalty program subscriptions come from improving service and relationships. Only about a third of respondents have developed personal relationships with restaurant brands. To improve this, responsiveness and friendliness of staff need to see increases in most business formats.
Hospitality and restaurant industry piece brought to you by Marlin Equipment Finance, leaders in food service equipment financing. Marlin is a nationwide provider of equipment financing solutions supporting equipment suppliers and manufacturers in the security, food services, healthcare, information technology, office technology and telecommunications sectors.