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Restaurant industry surge reaches six-year high

Staff photo by Nick Daggy Liz Rogers is the owner and head chef of Mahogany Cafe in Hamilton.

From right, Marcelina Cornwall her son Julian and daughter Yolanda Mayweather last year opened a Caribbean-influnced restaurant on Yankee Road in Middletown.

Staff photo by Pat Auckerman From right, Marcelina Cornwall her son Julian and daughter Yolanda Mayweather last year opened a Caribbean-influnced restaurant on Yankee Road in Middletown.

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By Mark Fisher and Eric Schwartzberg, Staff Writers 9:52 PM Tuesday, January 31, 2012

The national restaurant industry is showing measurable signs of recovery that have some Butler County eatery owners upbeat.

And because the restaurant and food-service industry employs an estimated one out of 10 Americans, such an expansion in this sector could help jump-start the economic recovery and provide a much-needed spark to what has been a rather bleak jobs outlook, according to restaurant industry officials.

Fueled by a mild winter, solid same-store sales and a bullish outlook among restaurant operators, the National Restaurant Association’s Restaurant Performance Index (RPI) rose sharply in December to its highest level in nearly six years, the association announced Tuesday.

In addition, restaurant operators’ plans for capital spending rose to its highest level in more than four years, a positive sign for construction and restaurant-supply companies both locally and nationally.

Ohio Restaurant Association spokesman Jarrod Clabaugh said the state’s restaurants employ about 525,000 people and are a driving force in the Ohio’s economy.

“In addition to representing 10 percent of the state’s employment, restaurants are the cornerstones of their communities, and stronger food-service sales often reflect upticks in both consumer spending and overall optimism in the economy,” Clabaugh said.

Mahogany’s Cafe & Grill, Hamilton’s upscale soul food restaurant, exemplifies the national trend, according to co-owner and Executive Chef Liz Rogers. She said the business experienced a 10 percent increase in sales over the past year.

Earlier this month, Rogers announced a spring opening of Mahogany’s second location at The Banks along Cincinnati’s riverfront.

December’s spike in the RPI has Rogers confident about the state of sit-down dining.

“I think that the restaurant industry is doing a lot better,” she said. “I think it depends on what kind of restaurants you actually have and if you have some sort of concept or not, or a niche.”

Marcelina Cornwall, owner or Caribbean cuisine restaurant Marce’s Sabor in Middletown, said sales have been a mixed blessing since the business’ June 2011 opening.

“You have months that are up and some are down,” Cornwall said.

News of improved restaurant performance on a national level is cause for optimism, she said. “You always want to expect that it’s going to rise,” she said. “I think it’s going to get better.”

As the economy has shown signs of improvement in recent months, customers have ordered a bit more freely, on occasion.

“On the weekend, they’re more willing to spend a little more money,” Cornwell said.

Hyde’s Restaurant in Hamilton found sales “holding strong” in the past year and improving since it remodeled in September, according to co-owner Ashley Tuley.

“Our clientele is of a fixed income and also we have snowbirds who leave us each year for January and February. But I feel confident that we will continue to keep doing what we’ve been trying to do, which is offer really good food at a great value, home-cooked,” Tuley said.

While sales have increased, so have the cost for food coming in at nearly the same rate — 4.5 percent. “I certainly didn’t increase my pricing to reflect that,” she said.

The National Restaurant Association’s Restaurant Performance Index tracks the health of and outlook for the U.S. restaurant industry, although it doesn’t break down its numbers by state.

The RPI stood at 102.2 in December, up 1.6 percent from November. In addition, December represented the third time in the last four months that the RPI stood above 100, which signifies expansion in the index of key industry indicators, association officials said.

“In addition, restaurant operators are solidly optimistic about sales growth in the months ahead, and their outlook for the economy is at its strongest point in nearly a year,” said Hudson Riehle, senior vice president of the Research and Knowledge Group for the Association. “Coupled with the solid November results, the RPI’s impressive December performance bodes well for continued positive industry momentum in the year ahead.”

Sixty-nine percent of restaurant operators reported a same-store sales gain between December 2010 and December 2011, while only 18 percent reported a same-store sales decline. This marked the strongest net positive sales performance since February 2004, when 70 percent of operators reported a sales gain and 17 percent reported lower sales.

Customer traffic counts also were up, and 55 percent of restaurant operators plan to make a capital expenditure for equipment, expansion or remodeling in the next six months, up from 47 percent in November and the strongest level in more than four years, association officials said.

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