U.S. restaurants see another week of improvement

U.S. restaurant chain transaction declines continued to improve for the fourth consecutive week in the week ending May 10 as more states reopen. Total restaurant customer transactions were down 23% compared with a 26% decline the prior week, reported The NPD Group. Full-service restaurants benefitted from a Mother’s Day lift, improving transaction declines by 39%, although still down 58% compared with a year ago. Transactions at quick-service restaurants declined by 21% in the week ending May 10 compared with a 24% decrease in the prior week, according to NPD’s CREST Performance Alerts.

As of the week ending May 10, NPD estimated that 19 states allowed some level of on-premise dining. Some of these states never imposed restrictions, while some reopened in the past couple of weeks. In aggregate, the “open” states performed 8 points better than the remaining states in the week reported, which reinforces the point that reopening happens gradually, as both dining room capacities and consumer demand come back incrementally.

Tennessee and Texas are among the largest states in terms of restaurant unit counts that have lifted restrictions to on-premise dining in the past couple of weeks. Both states showed customer transactions improved by 7 percentage points in the week ending May 10 over the prior week. Tennessee restaurant transactions were down 14% and Texas was down 18% compared with a year ago.

“Permanent restaurant closures, economically distressed consumers, and the possibility of a second wave of virus cases still bring uncertainty; but at least for now, the recent run of weekly gains is encouraging,” said David Portalatin, NPD food industry advisor and author of Eating Patterns in America. “The road back will be challenging and slow, but we’re headed in the right direction.”