How Does Your Business Stack Up Versus Industry Benchmarks?

Articles
February 20, 2012

How Does Your Business Stack Up Versus Industry Benchmarks?

Whether you are a grocer, manufacturer or foodservice operator, the most recent sales estimates from the U.S. Census Bureau will give you a handle on how you fared against the industry as a whole last year, and give you a first look at how 2012 is starting out. This is useful benchmarking information The Food Institute provides members like you each month that you may want to share with your employees, your suppliers and even your customers.

Whether you are a grocer, manufacturer or foodservice operator, the most recent sales estimates from the U.S. Census Bureau will give you a handle on how you fared against the industry as a whole last year, and give you a first look at how 2012 is starting out. This is useful benchmarking information The Food Institute provides members like you each month that you may want to share with your employees, your suppliers and even your customers.

Food Store Sales Off To A Slow Start In 2012

On the retail side, the latest revisions for 2011 put overall sales at the nation’s supermarkets a comfortable 5.2% over a year earlier at $522 billion. That is nearly three times larger than the seemingly small 1.8% gain supermarket sales increased in 2010. However, almost all of the gain in 2011 was the result of grocers successfully passing along higher prices to their shoppers after nearly 18 months of absorbing higher prices at wholesale (More on that in next week’s report!) So considering that retail food prices increased 4.8% in 2011 physical sales volume rose less than 1% last year based on these revisions.

And looking at the first industry benchmarks for 2012, sales results are not very encouraging as grocery store sales (95% of those are supermarkets) advanced just 2.9% from a year earlier. (Note that supermarket sales data lags one month behind other data from the Census Bureau for some reason.) That is the smallest such gain since October 2010 – 15 months ago. So, how did your numbers for the first month of 2012 fare against industry-wide data reported here?

Clubs & Supercenter Sales Gains Edged Out Grocers Only Marginally In 2012

The 5.5% Increase in sales reported by the nation’s warehouse club & supercenter operators in 2011 was only slightly larger than the 5.2% gain in supermarket sales noted above. Of course only about one-half of the sales at these clubs/supercenters are food according to industry estimates – still the largest among the so-called alternative food retailers. Drug store sales, meanwhile, increased only 3.2% during the year, and were up only 0.7% from 2010 during December. And mail-order, e-commerce sales, of which only a small portion is food, continued their double-digit growth, rising 12% last year.

Unfortunately, another alternative retailer, dollar stores, are not broken out separately by the Census Bureau, included only in an “other general merchandise” categorization. That broad group, which also includes such retailers as home and auto parts stores, saw sales rise 5.2% as well in 2011 to $55.6 billion.

Dining Out Patrons Going Upscale

Based on revised 2011 sales data, the nation’s full service restaurant industry had an extremely strong fourth quarter, seeing sales rise 11% to $55.5 billion. A very strong December, during which sales jumped 12.4%, contributed greatly to that increase. Interestingly, that increase in full-service sales, was just under the 11.95% increase in the Dow Jones Industrial Average during the same period – the largest such gain in nine years! Perhaps the rise in the stock market gave consumers frequenting more fine dining establishments a reason to splurge during the end of the year.

Limited service (fast-food) outlet sales increased only 4.5% during the quarter – barely keeping pace with retail food price inflation. But December sales finished the year nicely, rising 6.4%.

And the first data from 2012, puts January sales up 7.2% at the eating and drinking places and the Food Institute estimates the trend toward greater sales at full-service restaurants continued last month. The first government breakdown by type of restaurant will not be available until March.

For regular monthly updates of all of the important economic benchmarks, go to www.foodinstitute.com.