Toby Smith

Restaurants Hunger for Customers in Downturn

by Toby Smith   11/07/08

Forty-six percent of respondents who said they are dining out less frequently cited a general increase in the cost of living as the primary reason why. Higher energy costs (29%) and rising food costs (28%) also ranked among the top reasons given.

Thirty-eight percent of consumer respondents said they are eating more meals at home.

Among those respondents who do eat out, 28% said they're skipping beverages like soft drinks and alcohol, and 28% said they're ordering less-expensive items from the menu.

Lost of Empty Tables

For the third-consecutive survey, it's upscale/fine dining restaurants that are taking the biggest hit in terms of the restaurant spending slowdown.

Only 3% of respondents said they'll dine at these establishments more often during the next 90 days, while 36% said less often.

High-end casual restaurants are also being severely hit.

If there's a glimmer of hope currently, it may lie in quick casual/family restaurants -- 14% of respondents said they'll dine at them more often, and just 12% said less often.

While it's difficult to pick winners right now, there are a handful of chains that do appear best-positioned once consumers start to pick up their spending again.