Consumer Eating and Dining Habits of America Today (2/6)

The NRA’s "Restaurant Spending, Consumer Expenditure Survey: 2003," reveals that persons between the ages of 35 and 54 typically are in their peak earning years and therefore spend substantially more than those in other age groups on food away from home. Households headed by that age group accounted for 41 percent of all households but rang up a full 50 percent of all food-away-from-home expenditures, the NRA notes. Americans Dine At Where They See Good Values Americans naturally “gravitate” toward good values. Price and the determination of how much money to spend also emerge as factors in a typical consumer's decision to visit a restaurant. People never let the cost of food rise faster than their incomes. Consumers’ willingness to spend money on food is not necessarily related to the cost of the food. Real disposable income continues to grow. Even during the recession of 2001, it increased 1.9 percent. Last year it rose 3.5 percent, and this year it is running about 3.3 percent. That is a solid indicator that consumers will continue to spend at restaurants. Nevertheless, restaurateurs are intimately aware that consumers can be a price-sensitive bunch and attempt to set their menu tariffs accordingly. For example, in both 2003 and 2004, the Producers Price Index rose 5.5 percent. Over the same period of time, the menu price index rose only 2.3 percent. Why aren't those costs passed through? It's because the industry is so competitive, and competition tends to dampen menu price increases. The West Sees Highest Spending on Food In an analysis of 2003 expenditures for food away from home by region, households in the West led the pack, with an average annual amount of $2,449. Following those were Northeast households, with average yearly restaurant spending of $2,424; Midwest households, $2,184; and households in the South, $1,964. Gas Price Rise Sheds Little Effect on Restaurant Spending Rising gasoline prices might have affected a destination restaurant where it requires consumers to drive far to its location. there is not yet significant negative effect, if the restaurant is not on your way home, or on your way to a meeting, or not sitting in a shopping center of your neighborhood. Conventional wisdom might suggest that consumers are cutting back expenditures at restaurants because higher fuel costs are cutting into their discretionary incomes. But, according to Paul Leinberger, a researcher of NOP and Roper research group, "When consumers are optimistic and feel good about themselves, they enjoy the treat of going out to a restaurant. We don't expect to see that change unless we see gas prices go above $3 a gallon." Shifting Demographics US restaurants industry are observing and adapting to the changing eating habits of consumers in different life stages, hectic life styles, and more diverse population. With significant changes happening to what constructs the American population, demographics are vital especially for the restaurant industry. The changes are reflected in consumer spending patterns and consumer life-stage and lifestyle. A recent study conducted by the NPD Group found that consumers across all age groups visited quick-service hamburger restaurants more often than any other types of eateries. Their second-most-popular eating-places type was quick-service pizza outlets. However, consumers aged 50 and older chose as their second choice mid-scale restaurants like Denny's and IHOP that offer varied menus. Americans Are Aging, Says The Census Bureau The U.S. population age 65 and older is projected to grow faster than the total population in every state as the oldest baby boomers become senior citizens in 2011. In fact, it observes, 26 states are projected to double their 65-and-older populations between 2000 and 2030.