Data from independent foodservice research agency The NPD Group shows out of home meal and snack visits in the UK have contracted by -6.0% since 2008, and are unlikely to recover to pre-recession levels in the next 18-24 months.
As the UK’s foodservice brands fight to maintain market share, The NPD Group’s experts examine what brands must to do survive.
On average UK consumers ate out of home (OOH) 181 times last year, a significant drop of 15 visits per year since 2008, said researchers.
The NPD Group’s data reveals the decline is particularly noticeable amongst 18-24 year olds, who accounted for 222 visits in 2008 but only made 184 visits last year, and 25-34 year olds who dined out 28 fewer times in 2011 compared to 2008.
Guy Fielding, business development director for foodservice Europe at The NPD Group, said: “Although the market generated 11bn visits to restaurants in 2011, the loss of more than 90m visits, as customers cut back, shows the eating out of home market is shrinking.
“Nationwide foodservice brands and independents alike are fighting for both customer visits and for serving share in a ferociously competitive environment. Every time one brand wins a new customer, another brand loses one.
“The market continues to contract, and it is difficult to predict a return to growth in the short term. At the same time some consumers are ‘trading-out’, in other words, they are simply no longer eating out, removing themselves from the market entirely.”
Workplace catering losing out to the high street
More than 40% of the 90m foodservice visits that were lost in 2011 can be attributed to the decline in workplace eating, said The NPD Group. The impact of rising unemployment has been exacerbated by the increased number of attractive high street meal deals, promotions and incentives.
Fielding said: “2012 will be a tough year. Foodservice brands need to understand and leverage their core strengths, find fresh ways to connect with their customers and watch and react to changing offerings from their competitors.
“We’re already seeing the UK’s foodservice landscape change. Some foodservice outlets have extended opening hours, others have launched new products in new categories and some have even introduced different service formats. On the other hand, some have reacted by simply slashing prices and offering more deals. Consumers are being offered more choice whilst brands and independent outlets are fighting for their share of a declining market.
“For foodservice brands to succeed in this environment they must attract and claim their share of a shrinking audience that is increasingly cost-conscious. They need to offer a clear value proposition, and ensure they communicate it to consumers with messaging that is relevant to them. Whether that message is value, healthy food, local sourcing, great service, or a place for kids and families, the brands that survive and thrive will have successfully moved beyond price, price, price.”