The National Restaurant Association's Chief Economist Bruce Grindy analyzes the latest retail sales figures. Restaurant sales registered a solid gain in March, and returned to the levels reached before the recent soft patch. Although restaurant operators are generally optimistic about sales growth in the months ahead, their outlook for the economy remains mixed.
Restaurant sales posted a solid gain in March, and bounced back completely from the recent soft patch. Eating and drinking place sales totaled $47.3 billion on a seasonally-adjusted basis in March, up 1.1 percent from February’s upward-revised sales volume of $46.8 billion, according to preliminary figures from the U.S. Census Bureau.
The March sales volume matched the previous record high registered in November 2013, and came on the heels of three months in which sales were dampened somewhat by challenging weather conditions.
Total retail sales also rose 1.1 percent on a seasonally-adjusted basis in March, while grocery store sales edged up 0.2 percent.
Looking ahead, restaurant operators remain relatively optimistic about the business environment in the coming months. In the NRA’s March 2014 Restaurant Industry Tracking Survey, 40 percent of restaurant operators said they expect to have higher sales in six months (compared to the same period in the previous year), which is essentially unchanged from the responses in the previous four months. Only 11 percent of restaurant operators expect their sales volume in six months to be lower than it was during the same period in the previous year, while 49 percent expect their sales to remain about the same.
In comparison, restaurant operators are somewhat less bullish about the direction of the economy. Twenty-nine percent of restaurant operators said they expect economic conditions to improve in six months, while 16 percent expect the economy to worsen. The remaining 55 percent expect economic conditions to remain generally unchanged in the next six months.
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