RESTAURANT INDUSTRY - SWINE FLU MAY STEM DEMAND

Our healthcare analyst, Tom Tobin, flagged the following two CDC charts this morning.  The first chart shows that the flu season is starting early this year as it was virtually non-existent at the same time in the prior two years.  This chart points to an already bad flu season that is likely to get significantly worse come the winter months when the flu is more prevalent.  The second chart illustrates which regions of the U.S. are currently most affected.

 

Swine flu has infected more than 254,000 people since April and killed more than 2,800, according to the World Health Organization. The number of fatalities has more than doubled in the last month, with infections rising 10-fold since June.  Thus far, the swine flu has not been as deadly as past pandemics, but based on current outbreaks so early in the season, it is likely to be far more widespread.

 

Such widespread illness, even with only moderate symptoms, will affect people’s behaviors, and I would not be surprised to see an impact on restaurant demand.  Most obvious, people will not go out to eat if they are sick.  The bigger impact, however, comes from all of the people who choose to stay home out of fear of becoming infected.  From a geographic standpoint, it will be interesting to see how restaurant trends in Florida and the South Atlantic states have fared most recently as the flu is most widespread in those regions of the country.  Based on Malcolm Knapp’s data, both Florida and the South Atlantic have been outperforming the national average in recent months (through June) after consistently underperforming in 2008 and early 2009.  We expect to receive Malcolm Knapp’s July regional data and overall August comparable sales numbers in the coming week.

 

RESTAURANT INDUSTRY - SWINE FLU MAY STEM DEMAND - Swine Flu1

 

RESTAURANT INDUSTRY - SWINE FLU MAY STEM DEMAND - Swine Flu2


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