U.S. Restaurant Traffic Will Grow Less Than Population Growth Over Next Decade

The aging of the U.S. population will not benefit the restaurant industry over the next decade, forecasts NPD.

August 26, 2010

CHICAGO - U.S. restaurant growth will increase one percent a year over the next decade, lower than the 1.1 percent a year growth in the U.S. population, The NPD Group announced in its new foodservice market research report, "A Look into the Future of Foodservice," which also forecasts that the number of annual visits to restaurants will climb eight percent during that same time period.

The report provides forecasts of restaurant segments, visit situations, population growth and foodservice trends in the context of the aging of the U.S. population. Collectively, the data led NPD to conclude that the aging of the U.S. population will not benefit the restaurant industry over the next decade.

"The aging effect on the restaurant industry will be slightly negative because of aging Baby Boomers," said Bonnie Riggs, NPD??s restaurant industry analyst and author of the report. "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."

Riggs cited trend momentum, which captures behavior momentum of the previous nine years and includes factors such as menu items, promotions, and restaurant closings as not having worked 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," Riggs said. "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."

However, all is not lost. Riggs pointed to breakfast and afternoon snack trends as presenting foodservice opportunities.

"Forecasts are something to be worked against, but are not cast in stone," Riggs said. "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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