LOS ANGELES: Latest insights released by NPD Group Inc, a market research firm, show rising grocery prices are driving US consumers back to restaurants, reports Reuters.
"Right now, supermarket prices are rising faster than restaurant prices," said Harry Balzer, chief industry analyst at NPD and author of ‘Eating Patterns in America’.
While Americans prepare 72 percent of their meals at home, they spend almost half of their food dollars in restaurants, Balzer said.
Balzer said food prices at grocery stores currently are up less than two percent from a year ago, when they were down by two percent.
Grocery stores are faster to pass changes in food costs on to consumers than operators of large restaurant chains, which tend to lock-in long-term prices for key food items.
Over the last few years, a weak economy, high unemployment and low prices for supermarket staples like meat, produce and milk prompted people to save money by cooking at home.
Those trends contributed to a drop in restaurant traffic. Annual U.S. restaurant visits, which totalled 61.5 billion for the year ended November 2008, fell about four percent to 59.1 billion for the year ended November 2010.
A healing US economy has prompted some diners to add restaurant visits back to their routines, but unemployment continues to hamper the industry's growth, NPD said.
Source: Reuters
