People are spending more money at restaurants – but fewer of them are doing it.
That’s the takeaway from Placer.ai, an information service that uses cellphone location data to estimate foot traffic at restaurants. Foot traffic in August fell 1.2% for fast-food restaurants, 1.7% for fast-casual restaurants, and 4.7% for full-service ones on a year-over-year basis, according to Placer.
“You’re seeing that dichotomy where you see solid sales numbers, but at the end of the day it’s mostly … because of price increases,” RJ Hottovy, head of analytical research at Placer, told CNN.
Chili’s, the fast-casual chain owned by Brinker International, showed a 3.8% increase in sales in stores open for at least 18 months. Traffic, however, went down 6.6%, and Brinker’s CEO acknowledged that this is primarily due to inflation: “We believe some guests are reacting to the tougher economic environment with fewer restaurant visits,” Joe Taylor said during a recent earnings call.
The situation is taking hold even though groceries are rising in cost faster than restaurant food, because eating at home still is considerably cheaper – something that food processors who supply both sectors will have to take into account as they strive to rebalance their production.
