Restaurant Spending Will Decrease This Year

A new study finds that diners say they will spend 9.1% less per meal.

March 12, 2014

NEW YORK CITY – Restaurants may have even more to worry about this year. Coming on the heels of weaker-than-expected national jobs data earlier this month and in the midst of a heated debate in Washington about raising the minimum wage, a new consumer survey by AlixPartners finds that 29% of Americans say they intend to spend less on dining-out in the year ahead. That’s the highest percentage among 14 diverse categories asked about in the study, including spending on entertainment, leisure activities, sports equipment, travel, clothing and home furnishings.

“Diners, like most American consumers today, remain stuck in the limbo of today’s seemingly one-step-forward, one-step-back economy,” said Eric Dzwonczyk, managing director at AlixPartners and co-lead of the firm’s Restaurant & Foodservice Practice, in a press release.

In addition, diners expect to spend 9.1% less per restaurant meal in the year ahead (versus. what they say they spent per meal in the past year, to $13.55 from $14.91), a dramatic slide backward in expectations from a similar AlixPartners survey a year ago when diners then said they expected to spend 5% less in the year ahead.

Meanwhile, the percentage of Americans in the survey dining out at least weekly over the last 12 months dropped to 57%, from 60% in the survey of a year ago, and the top reason given for cutting back on visits was — for the second year in a row —the desire to “eat healthier,” topping even “current finances.”

The study also found that promotions may be losing their effectiveness among consumers and that a market-share war is brewing among restaurants, especially in the lunch day-part. “There may well be promotion fatigue out there among consumers,” said Adam Werner, managing director at AlixPartners and co-lead of the firm’s Restaurant and Foodservice Practice. “Our survey and in-field experience suggests that consumers today are showing a preference for everyday low pricing and consistent value.”

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