How is the Restaurant Industry Recovery Going?

“The U.S. restaurant recovery is underway, but it will take time for it to return to pre-pandemic levels fully,” says David Portalatin, NPD food industry advisor and author of Eating Patterns in America.

According to a study by NPD Group, a data and analytics firm, the second quarter of this year reflects a significant increase in consumer spending at restaurants after state and local governments lifted pandemic restrictions and people got vaccinated.

Consumer spending at restaurants increased 32% in the April-May-June 2021 quarter compared to the same quarter last year, and for a pre-pandemic view, according to NPD, it was flat compared to the same quarter in 2019.

Restaurant visits, dining in or off-premises, were up 22% in the quarter compared to the same quarter last year and were down-7% compared to the second quarter of 2019, according to NPD’s daily tracking of the U.S. foodservice industry.

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Quick-service restaurants (QSRs), representing 81% of restaurant visits in the U.S., posted a 15% gain in visits in the second quarter compared to a year ago and a 5% decline compared to the second quarter of 2019.

Throughout the pandemic, quick-service restaurants, particularly chains, benefited from well-established off-premises services such as carry-out, drive-thru, and home delivery.

During the second quarter in 2020, which covered the height of the pandemic lockdowns and restaurant dine-in restrictions, QSR off-premises orders increased by 9% over the same quarter in 2019, driven by solid growth in drive-thru and delivery orders.

In this year’s second quarter, off-premises grew by 5% compared to a year ago, driven by gains in carry-out and delivery orders.

With most of their business reliant on dine-in visits, full-service restaurants (FSR) bore the brunt of the COVID dine-in restrictions. At the start of the second quarter this year, more areas of the country eased or lifted dine-in restrictions, and by the end of June, most states reopened.

Total FSR visits, dine-in, and off-premises, increased by 60% in the second quarter over a year ago and were down 17% compared to second quarter 2019.

Dine-in, or on-premises, visits to FSRs increased by 214% in the quarter compared to a year ago when they declined by 80%. Despite the gains, FSR dine-in visits are down 37% from the second quarter of 2019.

With dining rooms opening in the quarter, off-premises FSR visits were down 9% compared to an 83% gain in the same quarter in 2020.

“Commercial restaurants overall remain below 2019 traffic levels. The QSR segment, ideally suited to today’s new consumer realities, is performing very near pre-pandemic traffic levels with dollar volumes well ahead of that pace. On the other hand, FSRs still face headwinds such as dining room capacity in some places. Even where restrictions are minimal, labor shortages may keep operators from realizing their full operational capacity,” Portalatin concluded.