Restaurant sales rose for the first time in four months

After trending sharply lower at the end of 2020, restaurant sales bounced back with a healthy gain in January. Eating and drinking places* registered sales of $54.6 billion on a seasonally-adjusted basis in January, according to preliminary data from the U.S. Census Bureau.

That was up 6.9% from December’s sales volume of $51.1 billion, and represented the largest monthly increase since June. However, it wasn’t enough to make up for the 8.3% drop in sales during the final three months of 2020. 

January’s sales gain was a step in the right direction, but the restaurant industry’s road to recovery remains long. Overall, eating and drinking place sales in January still stood nearly $11 billion – or more than 16% – below their pre-coronavirus levels in January and February.

While January’s sales gain was much needed, most restaurant operators remain uncertain if it will be sustained in the weeks ahead. Only 16% of fullservice operators expect to have higher sales in February or March than they did in January. Forty-six percent think their sales will decline from January’s level.

Limited-service operators are only slightly more optimistic about the next several weeks. Twenty-one percent of limited-service operators think their sales in February and March will be higher than January; 37% expect to have lower sales.

Winter is here

Restaurants lost an important customer touchpoint during the recent surge in winter weather, with outdoor dining becoming less feasible in many parts of the country. This had been a lifeline for many restaurants, particularly in areas that ramped up indoor dining restrictions in recent months.

Only 42% of fullservice operators say their restaurant currently offers on-premises outdoor dining in a space such as a patio, deck or sidewalk, according to a National Restaurant Association survey conducted February 2-10, 2021. That’s down from 52% in November and 74% in September.

In the limited-service segment (quickservice, fast casual and coffee/snack concepts), 37% of operators say they currently offer outdoor dining – down from 46% in November and 60% in September.

*Eating and drinking places are the primary component of the U.S. restaurant and foodservice industry, which prior to the coronavirus outbreak generated approximately 75 percent of total restaurant and foodservice sales.

Read more analysis and commentary from the Association's chief economist Bruce Grindy.