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U.S. Restaurant Traffic Will Grow Less than Population Growth over Next Decade, Reports NPD

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Chicago, August 25, 2010 - Visits to U.S. restaurants are forecasted to grow less than one percent a year over the next decade, slower than the 1.1 percent a year growth in the country's population, according to recently released foodservice market research by The NPD Group, a leading market research company. The report, A Look into the Future of Foodservice, forecasts that annual visits to restaurants will increase by 8 percent over the next ten years.

The report, which provides forecasts of restaurant segments, categories, visit situations, and beverage and food products based on the aging of the U.S. population, population growth, and recent trends, finds that the aging of the U.S. population over the next decade will not benefit the restaurant industry.

"The aging effect on the restaurant industry will be slightly negative because of aging Baby Boomers," says Bonnie Riggs, NPD's restaurant industry analyst and author of A Look into the Future of Foodservice. "A greater share of visits will source to those 50 years and older in 2019, but as consumers age they become less frequent restaurant users. This means the restaurant industry will have heavier dependence on lighter buyers."


Source: The NPD Group/A Look into the Future of Foodservice

Trend momentum, which captures behavioral momentum based on the past nine years and includes such factors as new menu items, promotions, and restaurant openings and closings, has not been working in the industry's favor.

"In addition to being hit hard by the recession, Americans are eating more suppers at home, and fewer women entering the workforce have negatively impacted restaurant industry traffic," says Riggs. "The current trend momentum may not appear favorable for the industry moving forward, but it's the area where the industry has the greatest opportunity to change the direction of the forecast. There isn't much that can be done about the aging of the population and population growth."

She points out that the growth at the breakfast and PM Snack dayparts are examples of trends that present opportunities for the foodservice industry.

"Forecasts are something to be worked against, but are not cast in stone," says Riggs. "They are used to assess potential opportunities and risks for the purpose of long-term planning. The future course can be altered."

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

@npdfood

The NPD Group, Inc.
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