Does Strong Holiday Revenue Signal a Restaurant Rebound?

Q42018 restaurant sales growth increase

Is that the sound of happy restaurant owners dancing on the tables we hear? For the first time since August 2015, restaurants posted a 2% increase in sales store sales growth according to

In this post, we’ll examine some of the factors that influenced the increase and how restaurants can keep that growth going up and to the right.

Restaurants have been facing an uphill battle from factors including third-party deliverydeclining traffic, and the usual winter slump. But despite these challenges, December 2018 became the seventh consecutive month of positive growth. NRN reports, “By comparison, the industry was only able to post positive sales growth during two months of 2017.” NRN goes on to say, “ Same-store sales growth during the fourth quarter was +1.4 percent, which was the highest in over three years. Moreover, the industry was able to post these results on top of the only quarter with positive sales growth last year.”

So what accounted for this growth in a time when traffic declines have become the new norm? Simply put, guests that ventured out, spent more. In fact, the same NRN article based on data from TDn2K’s Black Box Intelligence reports that “average guest checks grew by 3.1 percent year over year in the fourth quarter. During the previous three years, average guest check growth never topped 2.5 percent.” Also of note is the heavy-handed discounting that many restaurants employed in previous years seem to have eased up. Real winners appear to be upscale casual and fine-dining concepts as they were the only industry segments that were able to drive positive sales growth over the last three years and were the primary recipients of the high average checks.

Wrap up

What can restaurants expect in 2019? It seems the prediction of a recession is less likely and that moderate growth is on the horizon as a result of the continued trend of consumer spending. Restaurants can also anticipate these seven themes to influence the global landscape this year.