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National Restaurant Association - Pent-up demand highest in the Northeast

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Pent-up demand highest in the Northeast

Nearly half of adults say they aren’t using restaurants as often as they would like, with consumers in the Northeast reporting the highest levels of unfulfilled demand, according to the NRA’s Chief Economist Bruce Grindy.  His Economist’s Notebook commentary and analysis appears regularly on Restaurant.org and Restaurant TrendMapper.

The trend line of restaurant sales was bumpy during the first four months of 2016, according to data from the U.S. Census Bureau.  Eating and drinking place sales totaled $54.1 billion on a seasonally-adjusted basis in April, which was up 0.3 percent from March but still below February’s record-high sales volume of $54.2 billion. 

Perhaps reflecting the recent uneven spending patterns, new research indicates that pent-up demand for restaurants remains elevated among consumers.  According to a national survey conducted between April 28 and May 1 by ORC International for the National Restaurant Association, 45 percent of adults say they are not eating on the premises of restaurants as frequently as they would like.  Similarly, 46 percent of consumers say they are not purchasing take-out or delivery as often as they would like.

Drilling down to a regional level, pent-up demand appears to be highest among consumers living in the Northeast.  Fifty-two percent of adults in the Northeast say they are not eating on the premises of restaurants as often as they would like, while 50 percent say they are not purchasing take-out or delivery as frequently as they would like.  Meanwhile, fewer than four in 10 consumers in the Midwest say they are not utilizing either on-premises or off-premises options as often as they would like. 

Not surprisingly, pent-up demand is higher among lower-income households, as six in 10 consumers in households with income below $35,000 say they would like to be using restaurants more frequently.  However, fully one in four adults living in households with income above $100,000 also say they are not patronizing restaurants as often as they would like.

As households with income above $100,000 are responsible for four in 10 dollars spent in restaurants, any degree of unfulfilled demand is an encouraging sign for the industry in the months ahead. 

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