Foodservice market ‘beating the downturn’

A pick-up in the number of adults eating out has put the UK foodservice market in a “strong position” from which to emerge from the downturn, a leading research house for the sector has said.

Analyst firm Horizons claims that with average spend on eating out reaching £13.80 and some 72% of UK adults eating out on a regular basis, the industry is well-placed to capitalise on the fact that customers are starting to have more money in their pockets.

Horizons suggests market innovation in terms of outlets and menus is partly responsible for the sector’s buoyancy, along with the continued growth of coffee shops, managed food-led pubs and casual dining outlets.

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It predicts the winners in the sector will be those operators who continue to invest in their product, develop a greater understanding of their customers and open new outlets.

Food and drink sales in the eating out sector actually dipped to £43 billion last year with inflation taken into account, but Horizons’ managing director, Peter Backman, says there is now some excitement in the market and sales are likely to grow by at least 1% over the next 18 months.

He said: “By the end of this year they will return to 2006 levels, and by 2013 they will get back to 2008 levels. The signs are that things are beginning to level out – the population is growing, particularly amongst the restaurant-using over-40s, and employment is starting to rise. This is all good news for a sector that has performed better than the retail sector and emerged fairly unscathed from the downturn.”

Backman says that the biggest growth area will be seen in the casual dining sector, where average spend is likely to be between £10 and £20. The casual dining sector is currently worth £1.9bn and expected to grow by 3% this year.

“This sector offers what the customer wants, at a price they can afford, and continues to adapt and change its offer to keep customers interested,” says Backman.

Horizons says that in terms of new eating out concepts, the most growth is evident in pub restaurants, healthy eating concepts, coffee shops, gourmet burger chains and Japanese quick service outlets.

It also said its research shows that while consumers look for novelty and innovation when they eat out, top of their list of concerns are quality, price and cleanliness, as well as quality of service.

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