The restaurant industry had its best sales growth in over a decade last month, according to the analytics firm Black Box Intelligence.
Black Box found that restaurant sales in November were 8.3% greater than in November 2019, and were 2.3% better than October, making for the best month in sales growth for the industry.
This is no doubt welcome news for the industry which was hard hit by the COVID-19 pandemic last year, as fewer people felt safe going out.
"It tracks with what we’re seeing in the industry and with the restaurant brands we work alongside," says John Owen, President of Acrelec Americas, a global technology company focused on reinventing the customer experience for restaurant and retail brands. He went on to explain why he thinks sales have grown.
Pent-up demand definitely plays a role. People are ready to return a sense of normalcy and comfort and going out to eat can be an event that provides that feeling, But, the increase in remote work may also play a role in more restaurant sales. People are spending more time at home and less money on transportation: They may choose to use some of that disposable income on going out to eat. Remote workers may see leaving their home, even if it is just to pick up a to-go item from a restaurant, as an experience to look forward to.
A Return to Normal
Last year saw a steep 54% annual decline in April as well as a 38% decline in May, as the pandemic set in and many city and state officials either closed restaurants or instituted strict precautions, according to Restaurant Business.
Even as many restaurant owners, as well as city and state government officials, established safety protocols such as mask requirements (depending on the state) and spaced-out, socially distanced seating, growth was still shaky at best, as sales slowed to a 15% year-over-year decline in October of 2020 and then to a 17% decline in November.
But as vaccines became widely available (60.1% of the country's population are now fully vaccinated), more people felt safe eating out, and the industry naturally rebounded. In July, Black Box reported 11 consecutive weeks of restaurant sales growth. But while guest checks, which Owen says are the size of the total spend from a guest, are on the rise, guest counts, or the number of people visiting an establishment, continued to lag.
How Are Some Popular Chains Doing?
While the Black Box numbers cover November, and recent earnings reports cover months prior to that, many popular chains reported earnings that confirm that things are getting better for the industry.
McDonald's (MCD) - Get McDonald's Corporation Report saw its U.S. same-store sales increase by 9.6% while rival Restaurant Brands International (QSR) - Get Restaurant Brands International Inc Report, which counts Burger King and Popeye's among its brands reported 12.3% global sales growth for its burger brand and a 4.4% increase for its chicken franchise. (The company does not specifically break out its U.S. sales.
Bloomin' Brands (BLMN) - Get Bloomin' Brands, Inc. Report, the parent company of Outback Steakhouse among other brands, reported that its U.S. comparable-store sales rose by 25.5% in its most recent quarter while Outback posted an 18.3% gain.
Darden (DRI) - Get Darden Restaurants, Inc. Report, which owns a number of brands including Olive Garden and Longhorn Steakhouse saw its company-wide same-store sales increase 51% from last year to $2.31 billion, driven by a blended same-restaurant sales increase of 47.5% and the addition of 34 net new restaurant.