News

New research shows steep decline in lunch traffic

September 13, 2016

More harrowing news today on the possible decline in business across food service, but this time the research revolves specifically around the lunch day-part and it's not good. According to global information firm, NPD Group, the sales of lunch across all food service sectors — which accounts for a full one-third of all restaurant traffic — have increasingly dropped since the first of this year. 

In a news release about the latest research, NPD Group states that for the second quarter of this year, ending June 2016, lunch visits fell 4 percent compared to same period one year ago. It was the steepest drop of all main meal day-parts served in restaurants, according to NPD. 

But, why?

Researchers attribute the falling sales to the increased number of people working at home and shopping online. So less people out and about equals less swings through the drive-through, meals out with colleagues, and even meet-ups for coffee and business. In the last decade, NPD said the number of people working from home has grown 24 percent, while over the last year alone, the number of people shopping online has grown 8 percent. 

Add to that the fact menu prices have increased and you have fewer lunch visits on average, according to NPD. The researchers also found the average lunch check in the second quarter grew as much as 5 percent, compared with last year, moving beyond what the analysts said is the "sweet spot" for prices for that meal. 

The wildly popular fast casual category for instance, along with casual dining, both appear to have taken particularly hard hits this year in the number of customer visits lost. For fast casual, visits were down 9 percent from last year at this time, and for casual they dropped 6 percent, while across all categories weekday food service lunch visits fell 7 percent. 

"Simply said, who can afford to go out (to) lunch on a regular basis when checks have risen for some as much as they have recently," said NPD Group restaurant industry analyst Bonnie Riggs, in a release. "Historically, food service lunch has been the occasion where consumers didn’t want to invest a lot time, money or energy into this meal. It's apparent by the drop in lunch traffic that the current value proposition isn't meeting these needs."  
 
Still, restaurant operators are making the best of it with a flurry of deals, like combo and value offerings at quick-service burger joints, which NPD said have prevented much steeper traffic declines. That said, NPD found  only about a quarter of all lunch customers pick up on those deals. And, when most folks see that the average lunch check these days is about $8, many turn to take up a new hobby — making and taking lunch from home.