Bob OBrien

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Bob OBrien
The NPD group
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The State of the U.S. Global Foodservice
Economy
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The Economy

• Its
• bad
• you
• know

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Not all periods of economic stress resulted in
declines in restaurant demand
Restaurant Industry Traffic Trend - PCYA
Source The NPD Group / NPD Foodservice / CREST
CONFIDENTIAL
For Client Use Only
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Traffic trend was negative for the first time
since spring 2003
Total Restaurants
Traffic Change vs. Year Ago

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Support Trends

• Womens workforce participation rate flat since
  2000
• Meals per person flat since 2001

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Segments Weak in 4th Quarter

• QSRs flat
• Midscale down
• Casual Dining down

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Pricing and Promotions

• Checks increasing lower than CPI
• Dealing up in 2008

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All of the industrys traffic growth this year
sourced to deal visits
Total Restaurants YE Nov '08 Traffic 0
Traffic Change vs. Year Ago
Deal ( )
Check
Non-Deal ( )
Check
(Share of Traffic YE Nov '08)
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Pricing and Promotions

• Checks increasing lower than CPI
• Dealing up in 2008

• Advertising increase as other industries cut back

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Unit growth came to a halt in 2008
Total Restaurant Traffic PCYA vs. Unit Count PCYA
Source The NPD Group / NPD Foodservice / CREST
CONFIDENTIAL
For Client Use Only
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Business Segments Weak

• Weekends down
• Supper only declining day part(2nd year in a
  row)
• Weekend Supper and Snacks werethe weakest
• On and Off Premises flat

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As traffic growth slowed, consumers cut back on
family visits
Total Restaurants YE Nov '08 Traffic 0
Traffic Change vs. Year Ago
Adult Only Parties ( )
Average Party Check 9.69
Parties with Kids ( )
Average Party Check 17.30
(Share of Traffic and Average Party Check - YE
Nov '08)
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Consumers age 18-24 cut back on their visits to
restaurants.
Meals and Snack Occasions Per Capita by Segment
YE November
260
254
254
235
233
231
209
207
205
204
168
160
162
151
Total Consumers
18-24
25-34
50-64
35-49
65
Under 18
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Winning Categories

• Other Sandwich
• Mexican
• Retail
• Hamburger

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Consumer Spending by Country
Total 8 Country Spend 816 Billion
Total Restaurant Away From Home Spend Distribution
Pop 45M
Pop 300M
Pop 60M
Pop 83M
Pop 65M
Pop 33M
Pop 61M
Pop 128M
Population is for entire country
Total is QSR, Full Service, and Retail
(In US Dollars converted 2/2/09)
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Consumer Spending by Country
Total 8 Country Spend 816 Billion
Total Restaurant Away From Home Spend Distribution
Pop 45M
Pop 300M
Pop 60M
Pop 83M
Pop 65M
Pop 33M
Pop 61M
Pop 128M
Population is for entire country
Total is QSR, Full Service, and Retail
(In US Dollars converted 2/2/09)
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Amount spent per Capita (US) by Country
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Traffic by Time of Day
Total
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Traffic by Time of Day
Total
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Traffic by Time of Day
Total
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Traffic by Time of Day
Total
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Traffic by Time of Day
Total
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Traffic by Time of Day
Total
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Traffic by Time of Day
Total
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Traffic by Time of Day
Total
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Traffic by Time of Day
Total
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Average Individual Check (US)
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Party Size by Country
2008 vs. 2007
2007 Party Size
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QSR traffic growth strongest in Japan France
registered the highest average eater check
Total
Components of Spending - Change vs. Year Ago
Spend
(In US Dollars converted 2/2/09)
YE November 2008 except Europe Apr Nov 2008
Source The NPD Group/CREST ?
Japan represents Tokyo and Osaka only
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Industry Structure by Restaurant Segment
Retail
Full Service
QSR
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Industry Performance by Restaurant Segment
Retail
Full Service
QSR
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Global QSR Category Structure
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Industry Structure by Daypart
Total
Morning Meal
Lunch
Supper
PM Snack
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Industry Performance by Daypart
Total
Morning Meal
Lunch
Supper
PM Snack
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Industry Deal Rate by Country
Deal Rate 2008 vs. 2007
2007 Deal Rate
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Global Same Store Sales Trends
NPD SalesTrac Same-Store Sales Percent Change vs.
Year Ago
Adjusted to reflect revised data from a Pizza
participant as of Jan 08 thru Sept. 08 Restated
data to reflect the exclusion of a Specialty
participant as of period 08-52
Sales Figures Reported Weekly Beginning January
5, 2003 Through December 28, 2008
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What now?

• Good long-term opportunity in European countries
• New product in Japan for the flat market
• Worried about Canada
• Maybe for no good reason

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What now?

• Still more quarters of declines
• Slow expansion with the recovery
• Tight pricing and margins
• Still more on-the-go services and products