We’ve been here before. Much like in 2025, when cautious optimism gave way by the end of the first quarter to anxiety and angst, 2026 is tracking similarly. Geopolitics, war, tariff and trade policies, rising interest rates, immigration issues, sticky inflation, rising food and energy prices — pick your buzzkill. There’s no shortage of tough realities poised to cloud business and consumer confidence again this year.
One silver lining, however, is that we’ve been here before. Navigating uncertainty and unpredictability has become business as usual for leaders in every channel of the foodservice industry. And the reality that consumers continue to want and need what the industry offers, despite macro-level market turmoil, fuels persistent resilience and opportunity.
According to the National Restaurant Association research, nearly 6 in 10 consumers say dining out at limited- and full-service restaurants is “essential to their lifestyles.” And slightly more than half say the same about using delivery, takeout and drive-thru restaurant options. Further, 70% of consumers say they’d like to use foodservice more than they currently do if their budgets allowed.
This year, the NRA forecasts industry sales to reach a record $1.55 trillion, an inflation-adjusted growth rate of 1.3%. As of early April, the NRA’s forecast held firm, as did predictions for modest growth from other industry experts. But fresh hits to consumer confidence — thanks to rising prices, a softening labor market and, especially, uncertainty over the war in Iran — were poised to take a toll.
A Test of Resilience
In a statement issued in mid-April, NRA Chief Economist Chad Moutray, Ph.D., noted that while restaurant spending has proven resilient over the past several years despite some strong head winds, that resilience is likely to be tested in the months ahead. “With energy costs sharply higher, consumers — already anxious about the economy and their household budgets — are becoming increasingly choiceful in how and where they spend,” he said. “A softer job market has only added to those concerns. For restaurants, the labor market is often key as people with jobs and solid income growth are more likely to eat out away from home.”
Moutray added that coming into 2026, there were reasonable expectations for strong economic tail winds, driven in part by tax incentives in the One Big Beautiful Bill Act and the prospect of lower interest rates later in the year. He expressed confidence that, should the conflict in Iran de-escalate quickly, the growth narrative could be put back on track for the balance of the year, despite near-term hurdles.
Should energy prices remain unusually high, however, the industry could be negatively impacted. In that scenario, Moutray noted, consumers will be forced to “make trade-offs in their spending, potentially weighing on restaurant traffic and sales. From an operator perspective, the financial math was already challenging, and consumers were already seeking greater perceived value when dining out. In this environment, restaurants will need to continue leaning into perceived value. They will need to clearly articulate what makes their menu and overall experience worth the spend while offering variety, innovation and strong hospitality,” he said. “Restaurant operators have navigated extraordinary challenges over the past several years, and this represents yet another test.”
David Portalatin, senior vice president and food industry advisor at Chicago-based Circana, says his firm’s outlook for 2026 also remains in moderately positive territory, despite new war-related uncertainties. “There is potential disruption right now with things like very high gas prices, but it’s too early to know if that will change the outlook,” he said. “We’d need to see the current disruption sustain for a period of time before seeing any major shifts in consumer spending. That said, it’s certainly a concern, particularly with regard to lower-income consumers for whom there’s a direct share of wallet hit when gas prices rise as fast as they have. We don’t know yet how long this will last, but we continue to feel good about some of the underlying fundamentals, and we’ve seen traffic on an improving trajectory for the last two quarters.”
Circana forecasts approximately 1% growth in traffic for the rest of the year, a rate Portalatin expects to be sustained through 2028, with noncommercial operations faring slightly better than commercial. “The backdrop to that is we’re in a very mature, structurally flat marketplace, one that’s been in a -1% to -2% traffic environment for a while,” he says. “So this is meaningful improvement.”
Portalatin points to strength in recreation, healthcare and education foodservice, in particular, but says the commercial segment is gaining momentum as well. “One of the things that is encouraging is that a segment leader in recreation is movie theaters. That’s a sign that experiential demand is coming back,” he says. “People are looking for entertainment and to have experiences away from home, which bodes well for on-premises occasions. On-premises doesn’t occupy the same share of market that it did several years ago, and likely never will again, but in the moment, we’re looking for that third place — a place to sit down and take a break, whether by ourselves or with others.”
Datassential, too, recorded an optimistic start to 2026. The Chicago-based research firm found that the majority of operators were somewhat (47%) or extremely/very (35%) confident as the year got underway. Its research also showed that 60% of operators said they expect to see sales increases this year.
Huy Do, trendologist and research manager at Datassential, chalks some of that optimism up to the fact that we’ve been here before. “In 2025, operators and consumers alike were very focused on adapting to and making sense of widespread and dramatic geopolitical and economic phenomena,” he says. “Tariffs, inflation, even things like new dietary guidelines — over the past year and a half, we’ve seen so many new factors come into play that affect all corners of the industry. The trial by fire that all of those types of challenges presented in 2025 have brought us into a new normal of always being ready to adapt to change. This year, we’re seeing a shift in mindset: less hyper-focus on individual macro events and stronger focus on core aggregate impacts that businesses have to deal with.”
Value Perception
Promoting value is a top concern for operators in the current environment, but defining value and understanding how consumers perceive it goes well beyond price. Quality and experience must be part of the equation. A recent Datassential survey illustrates how these play into consumers’ definitions of value.
Home vs. Away
Over the past three years, restaurant and takeout costs (food away from home) have climbed faster than grocery prices (food at home). Restaurants currently get 53% of consumers’ food dollar, according to the USDA Economic Research Service, and the gap between retail and restaurant price increases has leveled out somewhat. But should prices continue to rise, the value equation for dining out relative to the cost of doing so may shift, putting added pressure on operators already struggling with higher costs and shifting demand.
Cost Increases
| Category | 2023 | 2024 | 2025 | 2026 Forecast |
| Food at home | 5.0% | 2.1% | 2.3% | 3.1% |
| Food away from home | 7.1% | 4.1% | 3.8% | 3.9% |
Source: USDA Consumer Price Index
Top Driver: Value
Do, like Moutray, believes that the No. 1 core focus now must be on value. “Anything that happens, whether it’s new tariffs, new geopolitical unrest, the war in Iran, rising gas prices — all of these individual things combine to have an effect on value in general and demand for it,” he notes. “Consumers are hugely focused on value, and operators are trying their best to launch as many value strategies as possible, throwing spaghetti at the wall to see which strategies hit and stick. And it’s not always just the lowest price.”
Long the purview of limited-service restaurants, which have leaned heavily into value positioning last year and early this year, full-service brands are also driving traffic and meeting consumer demand for affordable on-premises dining options. Logan’s Roadhouse, for instance, in March announced a new happy hour featuring $3 and $4 beers, plus $5 cocktails and shareable starters “designed for after-work visits that don’t feel like a splurge.” In late 2025, IHOP announced the launch of its first everyday value menu, featuring multiple combo meals available at most units for $6. It’s part of what the chain calls a broader push to offer more affordable dining options. Chili’s, Applebee’s, Olive Garden, Buffalo Wild Wings and many other segment leaders are turning up the volume on value as well, both with dedicated menu sections and with value-driven LTOs.
It’s all fueled by inflation, and to an even larger degree, some industry experts contend, by consumer perceptions of inflation. Whether fully justified by the scope of underlying economic realities or not, consumer perception and sentiment are the realities that can most directly influence restaurant spending.
Do says Datassential research shows a disconnect at play between reality and perception when it comes to the economy. “Over the past couple of years, many of the big metrics, such as GDP, inflation rate and employment levels, have stabilized or improved,” he says. “But there’s also psychology at play. We’re living in a moment when things are unstable, and we naturally fixate more on things that feel negative. It has a cumulative impact on how we feel about the economy, even if the material reality of many of these measures isn’t quite at that same level of doom and gloom. And specific to inflation, there’s often a lack of consumer understanding of how inflation works, which also contributes to separating macroeconomic realities from the consumer mindset.”
Macroeconomic realities aside, the consumer mindset is increasingly sour. The University of Michigan’s Consumer Sentiment Index plummeted 11% to a historic low of 47.6 in early April. Sentiment declined across all demographics as well as every index component. One-year business condition expectations plunged 20% while assessments of personal finances fell 11%, with consumers citing rising prices and shrinking asset values as key concerns. Year-ahead inflation expectations spiked to 4.8% from 3.8% in March, the largest one-month jump since April 2025, while long-term inflation expectations rose to 3.4%, the highest since November 2025.
For restaurant operators, squaring that disconnect with value-focused strategies is a top strategy in the current environment, particularly as consumer sentiment continues to fall. Says Portalatin, “The sentiment numbers are at some of their lowest levels ever. At some point, we will likely see the consumer sentiment numbers become detached from the consumer behavior numbers. If we stay at $4 a gallon gas prices for a sustained period, the outlook may change. But ultimately, the American consumer is going to eat out five times a week, on average. So the real differentiators in performance become who is executing well, who has the right value proposition, who is innovating the menu, who is relevant to emerging consumer trends. The operators who are doing those things are performing quite well right now.”
MFG Mindset: Disruption the New Norm
In releasing its 2026 Advocacy Issues Survey results in March, the North American Association of Food Equipment Manufacturers (NAFEM) noted, “What once felt like short-term disruption has become a lasting reality. Volatility is no longer temporary; it’s part of today’s foodservice equipment and supplies industry and a microcosm of the overall business landscape.”
For manufacturers, top sources of disruptive volatility are tariffs and regulation. The negative impacts from both of these pressures have grown substantially since the last NAFEM Advocacy Issues Survey was fielded in 2023. The one-two tariff-regulation punch is limiting manufacturers’ ability to manage costs, invest strategically and pursue growth, per the survey results. The association also points out that while the 2023 survey reflected post-pandemic challenges, such as extended lead times, shipping delays and material shortages, this year’s findings signal a shift. Trade policy uncertainty and tariff exposure have become long-term strategic concerns that complicate forecasting and capital investment decisions.
- 91% Manufacturers who said tariffs are negatively impacting their businesses, compared to 9% who said the same in 2023.
- 85% Manufacturers who said regulatory compliance is limiting their ability to control costs.
- 78% Manufacturers who said they’ve passed increased tariff-related costs on to customers.
- 53% Manufacturers who said regulation is making it more difficult to compete.
Source: NAFEM 2026 Advocacy Issues Survey of 396 member companies, Jan. 20-Feb. 3, 2026
