U.S. restaurant and foodservice sales will finally surpass 2019 levels

Restaurant staff are busy preparing food in the kitchen. — Photo by Kickfin.com

U.S. consumers are spending more at upscale hotels and restaurants, according to American Express’ Q1 report (Demos, 2022). Reservations in the company’s restaurant reservation service Resy jumped 16% from February, making March the busiest month ever for Resy.

The NRA predicted sales of $898 billion in 2022.

The National Restaurant Association (NRA) earlier released the 2022 State of the Restaurant Industry Report (Ruggless, 2022). The NRA forecast total restaurant and foodservice sales to reach $898 billion, slightly surpassing the $864 billion level in 2019. In 2020 and 2021, the industry reported annual sales of $678 billion. and $799 billion, respectively. Although after adjusting for inflation, foodservice sales in 2022 would still remain 11% below pre-pandemic levels, such growth shows a very healthy trajectory for the industry.

The pandemic has significantly changed the way restaurants operate.

The 2022 State of the Restaurant Industry Report (NRA, 2022) also highlighted some notable trends in operations, food and menu, and workforce. For instance,

  • About 50% of operators believe outdoor dining will become more common, a trend also reported in the April issue of this magazine.
  • 54% of adults (or 72% of Millennials) think takeout or delivery services are essential.
  • 96% of operators have experienced supply chain delays or shortages in the past few months, causing 80% of full-service operators and 2/3 of limited-service operators to change their menu offerings.
  • 90% of operators reported higher food cost (as a percentage of sales) than before COVID-19.
  • The industry created 1.7 million jobs in 2021, but 70% of operators said they did not have enough staff to support the service.
  • Projected jobs in the industry will reach 14.9 million, still 0.5 million below the 2019 level.

The industry is taking steps to respond to these changes.

Many operations have made significant changes to become more resilient to supply chain and labor shortage challenges. Some have invested in locally grown, fresh, packaged, retail-style food options and expanded their offerings off-site. Others have gained a competitive advantage by adopting new technologies to strengthen customer relationships and reduce labor costs.

What would you recommend to restaurant owners and food service operators to help them stay competitive in the market?

Linchi Kwok
Associate Professor
CAL Poly Pomona

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Food & BeverageMarkets & PerformanceUnited States

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