December was somewhat predictable for restaurant sales (historically one of the best months of the year – QSR & Fast Casual SSS were up moderately; Casual was flat to down). However, towards the end of the month there was a downward shift in several key factors that impact sales.
CONSUMER OPTIMISIM was at an all time high at the beginning of the month but days before Christmas that attitude slipped dramatically and consumers became more concerned about the impact taxes and other economic issues would have on their personal economy (it’s as if reality set in), and thus they became more frugal; more selective about their spending.
OWNER/OPERATOR PESSIMISM became worse. Throughout the month most operators were very pessimistic about a multitude of issues (see below) but this sentiment only worsened after the fiscal cliff deal was signed.
RESTAURANT PROMOTIONAL GAP – Typically most restaurants will change out their promotional message on the last weekend of the month. But this December (especially in the Casual Dining Sector) saw a gap between promotions where there wasn’t anything offered.
These events had a slight impact on December sales. Heading into January (historically the worst sales month of the year) the outlook isn’t very promising and the above issues will have an even bigger impact.