The National Restaurant Association says the industry “posted a modest increase in November.” Restaurants sales increased .84 percent in 2017, according to government data. Consumers opened their wallets for Christmas but did restaurants share in the spending? Wahlburgers signed a deal with the Meijer chain. These stories and a whole lot more This Week in Foodservice.

The National Restaurant Association’s Restaurant Performance Index improved a bit in November, rising to 101.1 from 100.9 in October. Both major components of the Index rose in November. The Current Situation Index reached 99.6. Despite the 0.1 percent increase, this part of the Index remained in contraction mode. This also represented the eighth consecutive month in which operators reported a net decline in customer traffic.

The Expectations Index hit 102.6, an increase of 0.3 percent for November, as operators became more optimistic about their own sales as well as about the direction of the economy as a whole.

Unfortunately, the improvement in the overall index did not translate into an improved picture for operators’ investments. In the last 3 months, 50 percent of operators report making an investment in equipment, expansion and/or remodeling. This is down from 67 percent who reported similarly in the October survey.

As for the future, 60 percent of those surveyed reported they plan on spending for equipment, expansion and/or remodeling in the next 6 months vs. 64 percent who had similar plans in October.

In summary, it appears from the data above that the industry continues to bump along perhaps with a little growth.

Economic News This Week

• The U.S. Commerce Department’s third estimate for the third quarter gross domestic product was +3.2 percent on an annual basis. This makes a .1 percent decline from the second estimate. Most observers continue to profess that the U.S. economy is doing well.
• First-time jobless claims remained unchanged at 245,000 for the week ending Dec. 23 from the week ending Dec. 16. The 4-week moving average was 237,750, up 1,750. The number of claims continue to run near historic lows.
• November housing starts increased 3.3 percent from October and increased 12.9 percent from November 2016. Building permits issued dropped 1.4 percent in November from October but the number building permits issued increased 3.4 percent over November 2016.
• Existing home sales grew 5.6 percent in November. This marks the third straight month existing home sales increased, the strongest pace since December 2006. The National Association of Realtors said November sales ran at a seasonally adjusted annual rate of 5.81 million homes.
• New home sales totaled 733,000, on a seasonally adjusted rate for November. This represents a 17.5 percent increase compared to October and 26.6 percent over November 2016.
• Durable goods orders increased 1.3 percent in November from October according to the U.S. Census Bureau’s advance report. The increase was driven by new orders for transportation equipment. Excluding transportation equipment, new orders for durable goods were down 0.1 percent for November.
• Personal income rose 0.3 percent in November while personal consumption expenditures rose a hefty 0.6 percent. Thus, consumers are in a spending mode but they are either going into their savings or buying on credit.
• The Chicago Production Manufacturing Index hit a six-year high in December, rising to 67.6 from 63.9 in November. (Any reading that exceeds 50 shows expansion and any number greater than 60 is considered exceptional.) New orders hit a two-year high.
• The Philadelphia Federal Reserve Manufacturing Business Outlook Survey Index increased in December. The index rose to 26.2 from 22.7 in November. (Any reading greater than zero shows increasing activity.) The New Orders Index rose to 29.8 from 21.4 in November. The shipments Index increased to 23.4 from 21.7 in November. But the Unfilled Orders Index fell to 10.8 from 17.0 in November. Both employment indexes also declined. Overall manufacturing business in the region continues to look strong.
• The University of Michigan Index of Consumer Sentiment continued to sink slowly in the final report for December. The Index fell to 95.9 in December from 98.5 in November. The Current Economic Conditions Index remained steady at 113.8 compared to 113.5. In contrast, the Index of Consumer Expectations dropped to 84.3 from 88.9 in November. A University spokesman said most of the decline was among lower-income households.
• The Conference Board’s Consumer Confidence Index declined in December after hitting a 17-year high in November. The Index fell to 122.1 from 128.6 in November. The Present Situation Index increased from 154.9 in November to 156.6 last month. The Expectations Index dropped sharply to 99.1 in December from 111.0 in November. 

Foodservice News This Week

• What did America spend last year? The web site 247wallst.com selected 50 consumer products and services and analyzed spending provided by the Bureau of Economic Analysis. Many of the findings were to be expected. Healthcare spending was way up and postal spending was way down. Other results were surprising. For example, spending for books, magazines and newspapers rose considerably. As for restaurants and bars, dollar spending was put at $5.61 trillion which was up 0.84 percent over 2016 and a 15.65 percent increase in the past 10 years. restaurants and bars accounted for 4.3 percent of total consumer expenditures. (Note: The data is for the first 11 months of 2017.)
• Did strong Christmas sales carry over to restaurants? Retailers are generally trumpeting a very good selling season (and in some cases a sigh of relief.) It is true that e-commerce drove the increase, rising 18.1 percent from Nov. 1 through Dec. 24, according to data from Mastercard. But, the brick and mortar stores did well, too, with Mastercard finding sales for the period up 4.9 percent vs. 3.7 percent last year. It has been long recognized that shopping trips outside the home frequently involve a meal or two. For some consumers it could just be a visit to a mall food court but others hit fancier operations. Early indications are December was a good month. We’ll find out when the Census Bureau data arrives later this month.
• Wahlburgers signed a deal with grocer Meijer, which calls for the hamburger company to open several restaurants at the supercenter’s locations in Michigan and Ohio.
• UberEats is bigger than Uber’s ride-hailing business in 19 European cities.  Just 3 years old, the food delivery division was on pace to hit $3 billion in sales by the end of last year. On the negative side, some European countries want to classify UberEats couriers as employees, which will likely increase the cost structure and may well increase fees that have to be passed on to the consumers.
• Corporate Stirrings:  J. Alexander’s Holdings has scheduled a special shareholders meeting in January in order to attain stockholder approval for the purchase of Ninety Nine Restaurant & Pub. Church’s Chicken sold 70 company-owned units in Texas to a new franchisee, Ampler Chicken LLC. Church’s also revealed the pending sale of six restaurants in the Atlanta area to an existing franchisee. The amounts paid for the purchase for the two deals was not stated.
• Growth Chains: Papa John’s inked a development deal to open 5 restaurants in the Bahamas in the next 36 months. Cool Greens has developed a franchise program which the chain plans to take the company nationwide. Tropical Smoothie has signed a franchise agreement for eight cafes in Florida. Falafel chain Taim will open five locations in New York and one in Washington, D.C. Mamoun’s, the New York City-based falafel chain, signed a franchise agreement for five restaurants in the Chicago area. Dunkin’ Donuts opened 16 restaurants in New York last year  and now has 612 locations in the Big Apple, making them the largest operation in the New York City area in terms of units.
• Comparable Store Sales Reports: Ark Restaurants up 0.9 percent and Darden Restaurants (All brands up 3.1 percent, Bahama Breeze up 2.5 percent, Capital Grille up 3.8 percent, Cheddar’s Scratch Kitchen down 2.0 percent, Eddie V’s up 6.8 percent, LongHorn up 3.8 percent, Olive Garden up 3.0 percent, and Season’s 52 down 0.5 percent.)

For details and same-store sales of other chains, please click here for the Green Sheet.