Are Independent Restaurants Growing in the U.S.? It All Depends.

Chicago, July 11, 2017 —There has been a lot of buzz about the strength of independent restaurants, even to the point of some saying independents were doing better than major chains. A clear understanding of restaurant performance begins with defining the landscape, says The NPD Group, a leading global information company.  Visits to independent restaurants were down 3 percent in the first quarter of this year from a year ago and consumer spending was flat; independent restaurant unit count dropped by 4 percent, reports NPD, which continually measures the foodservice industry in multiple ways.  Although overall the current state of independent restaurants  isn’t positive, there are some independent restaurants in the U.S. that are succeeding.

The decline in customer visits to independents is largely a reflection of the fact that independent restaurant unit count dropped by 4 percent.  A 4 percent decline in unit count but only a 3 percent decline in visits suggests that there are some of the 323,456 remaining independent restaurants in the U.S. growing.  For example, independent operators doing well enough to order from broadline foodservice distributors increased their dollar spend by 2 percent and cases ordered from these distributors were up slightly in the first quarter compared to year ago, reports NPD.   

There are also those independents successful enough to expand to 3-19 units, which NPD classifies as micro-chains.  Micro-chain counts, particularly in major metro areas, are increasing and this diverse segment of restaurants often reflects emerging trends in food and customer experience, which often enables success.  Micro-chain case orders from broadline foodservice distributors grew by 3 percent in the first quarter compared to year ago. 

In terms of independents doing better than major chains, it’s a David versus Goliath scenario to measure their visit growth against each other.  Major chains represent 64 percent of total industry traffic and independents, which NPD defines as 1-2 units, represent 22 percent of visits.  In the first quarter of the year, major chain visits were up one percent compared to the 3 percent visit decline for independents. Consumer spending at major chains increased by 3 percent and spending was flat at independents. 

“However you define ‘independent’ restaurants, the macro environment is not generating demand growth,” says David Portalatin, NPD’s vice president, industry analysis and author of Eating Patterns in America. “But even in this challenging environment there are many examples of major chains, micro-chains, and independents that are thriving because they have a differentiated experience, superior quality, and excellence in execution.  These fundamentals are key to restaurant success at every segment of the industry and in any macro-economic environment.”  



Related Press Releases

Aging U.S. Consumers Slow Down Food And Beverage Consumption Making It A Battle for Market Share
Aging U.S. Consumers Slow Down Food And Beverage Consumption Making It A Battle for Market Share

The aging population and corresponding changes in life stage will contribute to the decline in total eating occasions on a per capita basis in the U.S., according to The NPD Group’s recently released Eating Patterns in America.

What’s Life Stage Versus Generational Behavior When It Comes to Dinner Planning? Millennials Are Showing Us The Difference.
What’s Life Stage Versus Generational Behavior When It Comes to Dinner Planning? Millennials Are Showing Us The Difference.

It’s a common oversight not to age generations or recognize how life stage can impact behavior. To understand the difference between generational and life stage behaviors enables food companies and foodservice operators to develop products and marketing messages that are more relevant to their target consumer audiences.

It’s PSL Time! Pumpkin Spice Latte Limited Time Offers Are Still Working It for Fans and Foodservice Operators
It’s PSL Time! Pumpkin Spice Latte Limited Time Offers Are Still Working It for Fans and Foodservice Operators

The payoff for coffee and restaurant chains promoting seasonal pumpkin spice latte limited time offers are more visits and a higher average check size, according to The NPD Group’s Checkout Analytics.

Total U.S. Restaurant Count At 660,755 in Spring 2018, A One Percent Drop From Last Year, Reports NPD
Total U.S. Restaurant Count At 660,755 in Spring 2018, A One Percent Drop From Last Year, Reports NPD

The U.S. restaurant count reached 660,755 in spring of 2018, a 1 percent decrease in units from a year ago, according to a restaurant census conducted by The NPD Group. The primary source of the decline in U.S. restaurant units was a two percent drop in independent restaurant units.


Press Contact

Kim McLynn
847-692-1781
kim.mclynn@npd.com

@npdfood

The NPD Group, Inc.
900 West Shore Road
Port Washington, NY 11050

Want more?

Complete this form to hear from NPD.


Newsletter

Subscribe and get key market trends and insights relevant to your industry each month.

We will not sell your information. View privacy notice.

Follow Us

© The NPD Group, Inc.