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The National Restaurant Association (NRA) released its 2011 Restaurant Industry Forecast today, predicting that the quick-service industry's growth will outpace that of the full-service industry in 2011.
According to the forecast, quick serves will rake in a projected $168 billion this year, a 3.3 percent climb over 2010 (0.9 percent real growth, when counting for inflation). The full-service industry is set to earn $195 billion, a 3.1 percent increase over 2010, or 0.7 percent real growth.
Overall, restaurant industry sales will climb to $604 billion this year, a 3.6 percent increase, or 1.1 percent real growth, over 2010.
Hudson Riehle, senior vice president of the Research and Knowledge Group for the NRA, says the restaurant industry now accounts for 49 percent share of the total food dollar in the U.S., up from 25 percent in 1955.
“The restaurant industry has truly become an economic juggernaut within the U.S.,” he says, noting that the industry will grow to about 12.8 million employees this year, the second-largest private-sector employer in the nation.
Much of this year’s success should hinge on improving economic conditions. Real growth domestic product is expected to grow 3.5 percent, employment is expected to grow 1.8 percent, and consumers’ real disposable personal income is expected to grow 3.4 percent this year, Riehle says.
“When you look at what’s gone on with real disposable personal income growth, we’re looking to have real gains in the 3 percent range—substantial improvement over the past several years’ performance,” he says.
Still, Riehle says consumer confidence in the economy remains low, which should affect quick-serve operators for years to come. Forty-five percent of consumers have “some” confidence in the national economy, while 26 percent have “very little” and 15 percent have “none at all,” according to the NRA Forecast.
“It still indicates that consumers are anxious, related to what’s gone on with employment,” he says. “Once employment picks up, confidence will pick up.
“In terms of [consumer] perception, their situation still is not as solid as it was several years ago. Consequently, from a restaurant industry perspective, that value emphasis will continue this year and beyond.”
The Forecast also found that technology and social media will continue to play a bigger role in the restaurant industry this year. According to the report, 54 percent of “frequent” quick-serve customers—those who visit a quick serve more than once per week on average—frequently use texting, while 45 percent frequently use Facebook, 11 percent frequently use mobile phone applications, 9 percent frequently use online review sites like Yelp!, and 8 percent frequently use Twitter.
On the operator’s side of business, 79 percent of quick-service operators agree social media will become more important marketing tools in the future. Eighty percent say they’re likely to use Facebook in the next two years, while 69 percent say they’ll use Twitter, and 64 percent say they’ll use text messaging.
The mobile food movement will also continue to gain steam in 2011, Riehle says.
“We asked adults how likely they would be to order from their favorite restaurant’s menu at a mobile kitchen parked near their home and work place,” he says. “Almost one out of two [people] 54 [years old] and younger reported they would be likely to use it.
“The industry has always been about points of access, so this would definitely become an important avenue of growth, and additional point of access, from the consumer perspective, in the years ahead.”
To read about the NRA’s expected menu trends for 2011, click here.
By Sam Oches