The Counter: How Did Your Restaurant Fare?
Each quarter, we take a look at publicly traded restaurant companies’ operating results to provide insightful benchmarking information. In this issue of The Counter
(previously known as quarterly Benchmarking Updates), we look at the first half of 2016—and introduce a new look.
Same-store sales—while net positive through Q2—are not quite on pace with figures reported for fiscal year 2015. Despite restaurants reporting lower traffic counts, softer same-store sales do not mean openings are also on the decline. With interest rates low and the industry remaining attractive for investors, new restaurants continue to pop up. The pizza segment in particular was a bright spot, seeing the greatest growth in same-store sales at 3.6 percent, led by Domino’s for the seventh consecutive quarter.
Cost of sales declined across all segments, buoyed by inventory management efforts, increased menu prices and favorable commodity prices. Beef costs in particular saw a notable decline as higher supplies pushed them down by 10 percent through Q2. Some restaurants are taking the opportunity to offer customers new promotions and menu items.
On the other hand, the cost of labor has increased across all segments, likely driven by growing pressure to boost wages coupled with anticipation of changing overtime regulations.
Overall, the latest edition of The Counter
finds that remaining competitive and profitable in an increasingly saturated and cost-heavy industry will be a challenge to restaurants across the board. Those demonstrating creativity and a deep understanding of their customers’ needs and preferences, however, are well-positioned to vault to the head of the pack.
See more insights and to see the full, refreshed report.
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