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2003 National Restaurant Industry Forecast

Restaurant Industry to Register 12th Consecutive Year of Real Growth in 2003, Sales Expected to Reach a Record $426.1 Billion in 2003

Restaurant-industry sales are projected to reach a record $426.1 billion in 2003, up 4.5 percent over 2002, according to the National Restaurant Association's 2003 Restaurant Industry Forecast. On an inflation-adjusted basis, restaurant-industry sales are expected to increase 1.8 percent in 2003, which would represent the 12th consecutive year of real growth in the industry. On a typical day in 2003, the restaurant industry will post average sales of nearly $1.2 billion.

The resilient restaurant industry continued to post real sales growth during the last two years, in spite of fragile consumer confidence and the national economy's first recession in 10 years. In 2003, an improving economy and continued growth in disposable personal income will be the catalysts to propel the restaurant industry into another year of real growth. The projected 1.8 percent real increase in restaurant-industry sales in 2003 will be a modest improvement from the 1.3 percent real gain registered in 2002 when the industry faced a challenging economic environment. However, in spite of an improving economy, industry-sales growth in 2003 will still fall short of the stronger gains registered during much of the nine-year period from 1992 to 2000.

Among the major eating-place segments, the fullservice sector is projected to lead the way with a sales growth of 4.8 percent. Fullservice-restaurant sales are expected to reach $153.2 billion in 2003, which represents a $7.0 billion increase above their 2002 level. In the quickservice-restaurant segment, sales are projected to increase a somewhat slower 4.1 percent in 2003, with sales totaling $120.9 billion — up $4.8 billion from 2002.

Labor and Economic Issues Top the List of Challenges for Operators in 2003
During the robust growth years of the late 1990s, restaurant operators regularly reported that recruiting and retaining employees was the top challenge facing their business. However, in the uncertain economic environment of the last two years, operators are presented with a host of additional operational challenges.

Among quickservice-restaurant operators, recruiting and retaining employees remains the top operational challenge, followed closely by building and maintaining sales volume. In comparison, fullservice operators across all check sizes identified the economy as the top challenge facing their business, while recruiting and retaining employees finished fourth on fullservice operators' list of top challenges.