FAST-FOOD SALES TO PASS $100 BILLION IN '97: NRA STUDY

JACK ROBERTIELLO

WASHINGTON -- Fast-food restaurant sales will pass the $100 billion mark for the first time in 1997, and the retail-host category, which includes supermarket restaurant operations, will grow by nearly 5%, or $647 million, over 1996, according to a recently released annual food-service study.

Enhanced takeout offerings, growth of coffee bars and the proliferation of warehouse clubs will lead the advance in retail-host food-and-drink sales, expected to reach $13.9 billion in 1997, according to the report, released by the National Restaurant Association, based here. That would mean nearly a 5% increase over projected 1996 figures, and a 2% increase in inflation-adjusted dollars.

The retail-host restaurant category is composed of supermarket restaurants including a portion of deli and all salad bars, as well as restaurants operating in food stores, gas stations, drug-and proprietary-stores, general merchandise and variety stores.

However, the report says grocery/convenience store food-and-drink sales growth is expected to slow along with unit expansion, and food-and-drink sales at variety and drug stores are expected to weaken in the wake of operation closings.

The "1997 Restaurant Industry Forecast," prepared by researchers at the NRA and released in December, predicts that sales throughout the restaurant industry will top $320 billion in 1997, an increase of 4.2% over 1996 projections and an adjusted-for-inflation growth rate of 1.7%.

By comparison, actual sales for 1995 were $295 billion overall. Retail-host restaurant sales will have increased $2 billion since 1994's estimated $11.9 billion, the most recent year figures are available in the category.

The NRA focused a segment of its report specifically on home-meal replacement trends and activities in the restaurant industry.

The statistics cited throughout the report bolster the belief that operations sensitive to consumer's HMR needs will be well poised for the 21st century. Almost half (47%) of all adults responding to a consumer survey said they now cook fewer meals at home than they did two years ago.

Almost 40% said they consider meals prepared at restaurants or fast-food outlets essential to the way they live.

The study said recent research indicates that consumers seeking fresh food prepared outside the home try "to balance three different goals: Social pleasure, or 'togetherness;' eating pleasure; and lifestyle support or 'convenience'. "

Most significantly, 30% of adults said they would like to eat at restaurants or purchase takeout or delivery food more often.

The report says 57% of the occasions when consumers order carryout, they are pressed for time or have no energy to prepare the meal themselves. The same holds true for nearly 40% of the occasions when consumers order food to be delivered.

Forty percent of consumers surveyed by the association said they feel home cooking is a hassle. Roughly 80% of table-service restaurants offer takeout. Even half the upscale restaurants, defined by check averages totaling $25 or more, offer takeout.

In another part of the consumer survey, respondents said food was the most important attribute of an establishment, followed by service, price, location and consistency.

Regionally, the NRA forecast predicted the greatest sales growth in the Mountain states of Arizona, Colorado, Idaho, Montana, Nevada, New Mexico, Utah and Wyoming. Nevada was predicted to be the fastest growing state in the country, with a 6.9% increase in sales expected over 1996. Washington state will post a 6.2% gain in sales, the forecast predicts.

New England, with a 3.3% increase, and the mid-Atlantic states of New Jersey, New York and Pennsylvania, with a 3.4% increase, will show the smallest regional growth percentages in the country, the study predicted. Connecticut, where sales are expected to increase by 2.9%, will show the smallest statewide gain in the country and barely keep up with the erosion of even moderate inflation.

And states with the most food-and-drink business -- California, Texas and Florida -- will continue to lead the country in total food-and-drink sales.

Also in 1997, full-service restaurants will barely outpace fast-feeders, with the category accounting for $104.4 billion. The report also noted that sales in the ice cream, frozen-custard and frozen yogurt stand category were expected to slow in post-inflation dollars, primarily due to supermarket bulk sales competition.

Sales projections in the report for 1997 are based on data available in October 1996, according to the NRA, and will require adjustment if general economic conditions or those affecting the food industry change significantly.