(Dec. 24, 10:50 a.m.) The National Restaurant Association gave a bleak outlook on growth in the foodservice industry, as the recession continues to eat into consumers’ budgets, but cited healthy eating and green initiatives as trends to watch.

Sales will be up $8 billion, to $566 billion, from 2008 sales, mostly because of anticipated increases in prices on menus and by quick-service restaurants, as well as the on-site restaurant division, which includes health care foodservice and the academic market, that are carrying the rest. The association released its 2009 Restaurant Industry Forecast on Dec. 19 in a Web broadcast.

Even though national sales are projected to increase, Hudson Riehle, senior vice president of research and information services, said 2009 will be one of the most challenging years in decades for restaurants.

“Real growth is negative, more negative than in any other recessionary period in the last 40 years,” Riehle said.

Real gross domestic product will also decline, by 1.2%, in its weakest showing since 1982.

The economy

In its 2009 Top Trends Forecast, Denver-based National Restaurant Consultants Inc. also reported 2009 should be an especially tough year for the foodservice industry. The economy will be the No. 1 issue and consumers will limit spending, according to the forecast.

“We noted this is going to be one of the toughest years, especially for full-service and mid-range restaurants,” said Kevin Moll, chief executive officer of National Restaurant Consultants. “The fact of the matter is people are just cutting back.”

As growth of disposable income dwindles and the number of job losses increases, the correlation between restaurant business and these two factors becomes more obvious. Full-service restaurants seem to be taking most of the hit, Riehle said.

“People won’t have to stop going out, they just may go to different places,” Moll said. “Instead of a Chili’s, (it) may be a Taco Bell.”

Among these factors, input costs have also gone up. Riehle said wholesale food prices are forecast to grow a record high 8%.

Moll said even though quick-service restaurants are proving recession-proof at the moment, they are still facing the challenges of rising food costs.

“It’s going to be a tough year to make money,” he said. “It’s going to be a year unlike any in recent history.”

Restaurant operators are echoing back economic woes. In NRA’s latest survey, 44% of restaurant operators said the economy was their No. 1 challenge. In 2007, that percentage was only 9%. In 2007 and 2006, recruitment and retention were the biggest issues for most operators. Three-fifths of operators reported lower same-store sales than last year.

Going green

In the same survey, the NRA reported green initiatives topped the list of things that are important for restaurants. Those initiatives include more energy-efficient lighting fixtures, water-saving measures and alternative heating and refrigerating systems.

“Green initiatives are a trend across the board, especially those that are most cost-effective,” Moll said. “I don’t see a lot of rebuilding, but a lot of things that save restaurants money.”

Moll said tankless water heaters are an example of investments restaurants are making to save money in the long run.

Food safety also topped the list, with 40% of operators reporting they plan to put more resources into food safety.

Pent-up demand

Despite the setbacks, NRA officials agreed that the industry is up to the challenge. One opportunity, Riehle said, is what he called pent-up demand. The term refers to consumers who reported wanting to patronize restaurants more often. Riehle said this demand is growing, from 31% in 2007 to 33% in 2008.

“Once on-hand cash gets better, this proves people will be using restaurants more,” Riehle said.

The other possibility, though, is that people will be more cautious with their money even once the economy sees better days.

“We are in a unique time, more so now than in the Great Depression,” Moll said. “The economy looks not so good for at least a year, and people might not spend money, even if they did have it.”

One way restaurants will save money, Moll predicted, is by purchasing more bulk fruits and vegetables instead of precut, washed, prepared products.

“I suspect we’ll see a move away from high-end produce to more mainstream comfort foods,” he said.

Organic, locally grown trends

Riehle also reviewed information from the NRA’s “What’s Hot” chef survey for trends in 2009. Restaurants continue to focus on local and organic produce, as well as nutritionally balanced children’s meals, which include fruit and vegetable side dishes.

“Organic is a trend that’s here to stay forever,” Moll said.

He agreed healthier options for kids should expand in the coming year. He was not as optimistic about locally grown produce.

“It’s just my opinion, but I think local produce is overhyped,” he said. “The fact of the matter is you’re (as a restaurant) going to be getting your produce from all over. It’s not reasonably practical to maintain a full menu. Maybe a few seasonal local items, but not a full menu.”

Even then, he said, quick-service and mid-range restaurants are deal buyers and are not going to pay an inflated price for local products.

Moll suggested evaluating and reworking menus, evaluating labor and focusing on local marketing to get restaurants through the hard times.

“Now is a time to be proactive with marketing, pricing and controls,” he said. “It’s not the time for hands-off operators. It’s time to roll up your sleeves.”