Restaurant Industry Sales Turn Positive in 2011 After Three Tough Years

WASHINGTON, Feb. 1, 2011 /PRNewswire/ -- Restaurant industry sales are expected to reach a record $604 billion and post positive growth in 2011 after a three-year period of negative real sales growth, according to National Restaurant Association research released today. The Association's 2011 Restaurant Industry Forecast projects an industry sales increase of 3.6 percent over 2010 sales, which equals 1.1 percent in real (inflation-adjusted) terms.

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The nation's 960,000 restaurants will continue to be strong contributors to the recovery of the nation's economy, with industry sales representing 4 percent of the U.S. gross domestic product and employees comprising nearly 10 percent of the U.S. workforce. Its total economic impact exceeds $1.7 trillion, as every dollar spent in restaurants generates $2.05 spent in the overall economy. Restaurants are the nation's second-largest private sector employer with 12.8 million employees.

"As the national economy is slowly improving, the restaurant industry is climbing out of its most challenging period in decades to post positive real sales growth in 2011," said Hudson Riehle, senior vice president of the Research and Knowledge Group for the National Restaurant Association. "As in 2010, restaurant industry job growth is expected to outpace the national economy this year, emphasizing the importance of industry to the nation's economy."

"The U.S. restaurant industry is an economic juggernaut whose annual sales are larger than 90 percent of the world's economies – if it were a country, it would rank as the 18^th largest economy in the world. While pockets of challenges remain, we are looking forward to a brighter future in 2011," he added.

Industry Segment Growth

Continuing the trend from last year, the quickservice restaurant segment is expected to post slightly stronger sales growth than the fullservice segment. Quickservice restaurants are projected to post sales of $167.7 billion this year, a gain of 3.3 percent over 2010. Sales at fullservice restaurants are projected to reach $194.6 billion in 2011, an increase of 3.1 percent in current dollars over 2010.

The eating-and-drinking place segment expected to show the strongest growth in 2011 is social caterers, whose sales are expected to increase by 6.2 percent. Other commercial foodservice segments expected to post solid sales growth in 2011 are hotel restaurants (+5.7 percent), hospitals and nursing homes (+5.5 percent), and primary and secondary schools (+4.8 percent).

State and Regional Sales Growth

Among the 50 states, North Carolina is expected to post the strongest sales growth in 2011 at 4.2 percent (industry sales are projected at $14.1 billion), followed by Idaho ($1.8 billion) and Virginia ($12.8 billion) at 4.0 percent. Forecast to post growth at 3.9 percent: Colorado ($8.6 billion), Florida ($30.1 billion), Maryland ($9.4 billion) and Texas ($36.7 billion).

Of the nine U.S. Census regions, the South Atlantic is expected to post the strongest restaurant sales growth at 3.9 percent, totaling $93.9 billion among its eight states (Delaware, Florida, Georgia, Maryland, North Carolina, South Carolina, Virginia and West Virginia) and the District of Columbia.

Workforce Outlook

The restaurant industry posted modest job growth last year, and that growth is expected to accelerate in 2011. This year, the industry will add jobs at a rate of 2.4 percent, compared with the 1.8 percent expected for the national economy. In the next decade, the industry will add 1.3 million positions.

In the states, the restaurant industries in Texas and Florida will show the strongest job growth over the next 10 years at roughly 17 percent, followed by Arizona and Alabama at roughly 16 percent.

Consumer and Menu Trends

According to the National Restaurant Association's 2011 Restaurant Industry Forecast, consumers today spend 49 percent of their food budget in the restaurant community, compared with only 25 percent in 1955. The economic downturn has created a substantial pent-up demand for restaurant services -- more than two out of five consumers say they are not dining out or using takeout as often as they would like -- which positions the restaurant industry for growth in 2011.

Facebook, mobile phone applications, and online review sites have become part of many Americans' everyday life. The Restaurant Industry Forecast shows that social media savvy consumers (frequent users of at least one social media tool, including Facebook, Twitter, mobile phone applications such as Foursquare or Urban Spoon, or online review sites such as Yelp) are more active in the restaurant community. These individuals dine out more frequently than the general public: 92 percent eat a meal at a sit-down restaurant at least once a month (compared with 84 percent of all adults) and 87 percent purchase a meal or snack quickservice restaurant or carry-out place at least once a month (versus 83 percent of all adults).

In addition, 51 percent of social media savvy individuals say restaurants are an essential part of their lifestyle, while among all consumers that number is 43 percent. This demographic is also much more likely to use in-store technology like electronic ordering and payment systems at the table, self-service kiosks, online ordering and mobile phone applications for placing orders.

Not surprisingly, social media savvy individuals are also more likely to connect with restaurants on Facebook, MySpace or YouTube (29 percent, compared with 16 percent of all consumers), and post or read reviews on consumer-driven websites such as Yelp (30 percent, compared with 19 percent).

Restaurant operators are also picking up on this trend, and more than eight out of 10 say social media will become a more important marketing tool in the future. More than half also say they are likely to incorporate Facebook, online review sites, Twitter and blogs into their marketing mix in the next two years.

The 2011 Restaurant Industry Forecast also shows that local sourcing, sustainability, and nutrition will top menu trends in 2011. Top trends in fullservice restaurants (according to the Association's "What's Hot in 2011" survey of more than 1,500 professional chefs – members of the American Culinary Federation) include locally grown produce, locally produced meat and seafood, healthy kids' meals, sustainable seafood and gluten-free/food allergy conscious cuisine. On quickservice menus, the top trends will be healthy options in kids' meals, gluten-free items, spicy items, locally sourced produce, and smoothies.

Reflecting these menu trends, seven out of 10 consumers say they are trying to eat healthier when dining out now than they did two years ago. This trend is mirrored by restaurant operators, as two-thirds say their guests order more healthful items and pay more attention to the nutritional content of food than two years ago.

Another trend included in the Restaurant Industry Forecast is that of food trucks. Nearly half (47 percent) of consumers say they would be likely to patronize food trucks if their favorite restaurants operated them. The chefs in the "What's Hot in 2011" survey also ranked food trucks and pop up restaurants as the hottest restaurant operational trend in 2011.

For more information about the National Restaurant Association's 2011 Restaurant Industry Forecast, visit www.restaurant.org/forecast.

To view the social media version of this release, including downloadable charts and a video, visit www.restaurant.org/pressroom/socialmedia/forecast2011.  

Founded in 1919, the National Restaurant Association is the leading business association for the restaurant industry, which comprises 960,000 restaurant and foodservice outlets and a work force of nearly 13 million employees. Together with the National Restaurant Association Educational Foundation, the Association works to lead America's restaurant industry into a new era of prosperity, prominence, and participation, enhancing the quality of life for all we serve. For more information, visit our Web site at www.restaurant.org.

SOURCE National Restaurant Association

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