Avero Index September 2018
The end of the summer brought cooler temperatures and cooler consumer restaurant spending to the nation as September gave way to October. Restaurants across the nation experienced a YOY gross sales drop of one percent this September. This decrease correlates with declining restaurant covers coming in at 3.9 percent below last September’s covers. Considering the sizable decrease in covers, the gross sales drop could have been worse, but was buoyed by a 2.7 percent increase in average check. All things considered, fewer guests visiting restaurants this month resulted in lower national restaurant sales.
Los Angeles and San Francisco
California presents an interesting case this month. Restaurants in different areas of the state saw a broad range of performance in September. Los Angeles experienced a six percent decline, the largest drop in restaurant gross sales out of all restaurants examined in the Avero Index. This decline was greatest in breakfast and dinner sales coming in at 10.0 percent and 8.8 percent respectively, while lunch only dropped 2.3 percent.
This behavior is common when area tourism numbers are down since visitors largely drive breakfast and dinner sales. A senior vice president for an international hotel group based in San Francisco corroborates this finding with hotel data showing a corresponding drop in occupancy of 2.5 percent in the LA area.
San Francisco restaurants fared far better, showing growth of 4.6 percent in YOY gross sales. This strong performance continues a strong end to summer for the city that Anthony Kim of Mina Group attributes to an increase in average check.
In Las Vegas, restaurants continued to under perform compared to 2017 for the fifth month in a row. The steady decline occurred across a range of restaurants, but those with an average check under $90 saw a decrease of 2.8 percent while restaurants with an average check greater than $90 only dropped by 1.9 percent. Lower sales hit Vegas buffets particularly hard, dropping by 8.6 percent compared to full service restaurants which only dropped 4 percent. Bars, however, fared far better than other Vegas venues, increasing sales this month by seven percent.
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