NPD: Dining Out Drop Steepest In 28 Years

brownbagSeems like it's been ages since someone asked you if you'd care for freshly ground pepper or grated cheese on your entree? You're not alone: A new report shows that Americans are continuing to shun restaurants, with the spring quarter showing the sharpest decline since 1981.

At quick-serve restaurants, which include fast-food chains, traffic fell 2% in the quarter, compared to the same period a year ago, "marking seven of the last nine months with declining customer counts," says the NPD Group, a Port Washington, N.Y.-based market research company. Those who are stepping out for a meal at a casual dining spot dropped by 4%, and traffic at mid-scale eateries fell 6%. While average check size did rise 2%, it was not nearly enough to offset the weaker attendance. NPD says total industry traffic for the quarter slipped 2.6%, and that unemployment seems to be increasing consumers' commitment to eat at home.



It also marks the third straight quarter that diners with kids -- which typically represent a third of restaurant traffic -- have cut back. And more than half of the industry's decline can be traced to fewer supper visits from families. Visits by households without children, however, were stable.

And while an evening out for families was the biggest loser, other meals suffered too, including takeout and quick-service restaurants. "Morning meal and lunch also declined across all three segments this spring, and each contributed about a fourth of the industry's loss," the report says. Fast-food restaurants did a little better with lunch and breakfast, but were still soft.

Not surprisingly, the report also finds that restaurants are fading away, with the total number shrinking 1%, or about 4,000 units, in the quarter. "Dealing, value menus, and attractive price points seem to be supporting some operators who are holding on," the report says. "It is going to take continued innovation, creativity, and perseverance to capture share in a market where the pie may not be growing in the near term."

At Starbucks, for example, which announced Tuesday that its third-quarter revenues fell to $2.4 billion from $2.6 billion in the same quarter last year, same-store sales fell 5%. However, the company says that decline, is an improvement from the 8% decline it saw in the second quarter.

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