Restaurant Performance Index fell 1.3% in July
The National Restaurant Association’s Restaurant Performance Index (RPI) fell sharply in July, as a result of broad-based declines in both the current situation and expectations indicators. The RPI – a monthly composite index that tracks the health of the U.S. restaurant industry – stood at 97.7 in July, down 1.3% from a level of 98.9 in June.
Restaurant operators reported significantly softer same-store sales and customer traffic readings in July, which led to the sharp decline in the Current Situation Index. Looking ahead, restaurant operators’ 6-month outlook for both sales growth and the economy deteriorated in recent months.
The Current Situation Index, which measures current trends in four industry indicators (same-store sales, traffic, labor and capital expenditures), stood at 96.9 in July – down 1.2% from June and the fourth decline in the last five months. July represented the 10th consecutive month in which the Current Situation Index stood below 100 in contraction territory.
The Expectations Index, which measures restaurant operators’ six-month outlook for four industry indicators (same-store sales, employees, capital expenditures and business conditions), stood at 98.4 – down 1.3% from a level of 99.8 last month. Restaurant operators are increasingly pessimistic about both sales and the overall economy in the months ahead.
RPI Methodology
The National Restaurant Association's Restaurant Performance Index (RPI) is a monthly composite index that tracks the health of the U.S. restaurant industry. Launched in 2002, the RPI is released on the last business day of each month.
The RPI is measured in relation to a neutral level of 100. Index values above 100 indicate that key industry indicators are in a period of expansion, while index values below 100 represent a period of contraction for key industry indicators. The Index consists of two components — the Current Situation Index, which measures current trends in four industry indicators (same-store sales, traffic, labor and capital expenditures), and the Expectations Index, which measures restaurant operators’ six-month outlook for four industry indicators (same-store sales, employees, capital expenditures and business conditions).
The RPI is based on the responses to the National Restaurant Association’s Restaurant Industry Tracking Survey, which is fielded monthly among restaurant operators nationwide on a variety of indicators including sales, traffic, labor and capital expenditures. Restaurant operators interested in participating in the tracking survey: contact Bruce Grindy.
Updated 8/30/2024