Medium-term outlook for catering market picks up

Expectations of strengthening economic growth, falling unemployment and modest inflation “bode well” for an improved medium-term outlook for the UK eating out market, according to analysts.

Eating out participation amongst the UK adult population has now grown for two straight quarters for the first time since 2012, said research firm Allegra Foodservice.

Although there has been a marginal decline since Q2 2012, Allegra expects that with rising consumer confidence, eating out participation will improve further over the second half of the year.

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Despite this, the study reveals that eating out frequency is down from 2012 across all day-parts, with the average number of meals consumed out of home per person lower in Q2 2014 than Q2 2012 across all day-parts.

The decline has been more marked in lunch and dinner than breakfast. Allegra suggests that even as the economy shows growing signs of recovery, consumers are still feeling the pressure on their wallets and spending power.

While frequency has decreased for breakfast, lunch and dinner since Q2 2012, average spend is up across all day-parts. Rising input costs are driving up prices, and many consumers treat eating out as an indulgence worth spending money on.

Executive director, Simon Stenning, said: “Spend per occasion rises in a linear fashion, apart from a slight dip at 40-44 year olds, until peaking at the 65-69 year old demographic. This shows how older consumers continue to see eating out as a special occasion, while younger people approach it in a more casual way.”

Significant regional differences exist in eating out frequency. At an average of 12.05 meals per month, Londoners eat out significantly more than all other regions — more than twice the amount of consumers in Wales.

The report shows that there are notable differences between eating out habits across all the regions of the UK. Many regions have higher spends per capita on breakfast than in London, including the East of England, where average spend is £5.17 compared with £4.46 for London.

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