U.S. Restaurant Industry Continues To Grow At Slow Pace But There Are Pockets Of Stronger Growth —Combo Meal Deals Fuel QSR Growth While Fast Casual Traffic Growth Slows

Visits to restaurants will increase minimally quarter-after-quarter, resulting in an average lift in traffic of one percent annually, says The NPD Group, a leading global information company. All in all, the restaurant industry has been conducting business in a one percent world since 2010, and will continue at the same pace for several more years.

Chicago, IL (PRWEB) - Addressing the state of the restaurant industry for the last several years sounds like a broken record. Visits to restaurants will increase minimally quarter-after-quarter, resulting in an average lift in traffic of one percent annually, says The NPD Group, a leading global information company. All in all, the restaurant industry has been conducting business in a one percent world since 2010, and will continue at the same pace for several more years, based on NPD’s ongoing foodservice market research.

Though total industry growth is moving at a snail’s pace, there are pockets of stronger growth. The morning meal (breakfast and am snack) continues to fuel the industry’s visit growth. In the first quarter (January, February, and March) of this year, total industry morning meal visits increased by 2 percent compared to same period last year and increased by 4 percent at quick service restaurants (QSRs). Servings of breakfast foods increased by 8 percent, and breakfast sandwiches and other breakfast items topped the industry list of growing foods.

Restaurant visits on a deal were also an area of growth for the industry with deal traffic up 2 percent for total industry and up 3 percent at QSRs. Much of the deal traffic increase was driven by the combo meal “value wars” among the major QSR hamburger chains. Combo meal visits to traditional QSRs increased by 2 percent in the first quarter of 2016, and helped improve QSR hamburger visits overall. The average deal rate (percent of visits where an item was purchased on a deal) for QSRs is 26 percent. The average deal rate for the burger chains offering the combo meal value deals is 35 percent, according to NPD’s recently released report, Value Wars: A New Twist on Combo Meal Deals, which is based on an analysis using NPD’s receipt mining service, Checkout Tracking.

While consumers chose QSRs over all other segments to satisfy their away-from-home foodservice needs, of particular note was the flat traffic growth in the fast casual QSR category in the winter quarter. This was a departure from the strong traffic growth fast casual chains had experienced over the last several years. Chipotle’s recent food safety issues contributed to the slowdown in the last two quarters. Taking Chipotle out of the equation finds fast casual visits up 5 percent.

“There is a confluence of changing demographics, economic pressures, and evolving consumer attitudes and behaviors creating shifts in what, where, when, and how we eat,” says Bonnie Riggs, NPD restaurant industry analyst. “The key for foodservice manufacturers and operators is to stay connected with their consumers/customers, understand their motivations and needs, and how they can offer them a unique value proposition.”

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