The past two years has brought plenty of disruption to the food to go market. But despite the recent economic setbacks, the forecasts remain positive. In this blog, we look at five key trends that are shaping the return of the food to go market:
- Spending is up (despite visitation being down)
- Hybrid working opens up new opportunities
- Healthy eating and sustainable practices are top of mind
- Long term demand for delivery services
- Food waste prevention
1. Spending is up (despite visitation being down)
Although many consumers have been hit hard in their pockets, research from Lumina Intelligence revealed the sector recovered by 38% in 2021 and is set to reach £25 billion by 2025. Lumina say their findings show the low ticket nature of the food to go industry means consumers are unlikely to significantly restrict their spending on these products.
Lumina also found that while the number of office workers visiting shops and restaurants is down 40% since pre-COVID, spending is up 18%.
One explanation for this is consumers are more open to purchasing premium products when they do eat out, as it might be their weekly ‘treat’. For example, we’ve seen £10 lunch options like Leon’s burger bundle and Pure’s super salad meal deal grow in popularity in the first quarter of 2022.
2. Hybrid working opens up new opportunities
Today’s workers operate a more flexible schedule than ever before, where they may visit their place of work two or three times a week. This was highlighted in a recent report from CGA Strategy, where 45% of consumers revealed they do not plan to stop working from home or plan to work from home for the foreseeable future.
This change has driven footfall away from city centres and into suburban areas, opening up new opportunities for local, independent retailers. With convenience/location being the number driver for food to go consumers (ahead of value, choice, quality and speed), local businesses that can adapt to today’s healthier worker will be able to unlock new revenue streams.
For example, Manchester bakery Pollen have recently opened a new flagship location in the city’s Kampus garden neighbourhood with an expanded menu and open kitchen. This move highlights the shift in mindset of food to go businesses that are thinking outside of the traditional locations and looking to consistently evolve their offerings to consumers.
3. Healthy eating and sustainable practices are top of mind
Health and sustainability remain hot topics that are being driven by both consumers and regulatory bodies. The pandemic appears to have refocused consumers’ minds on health, with 70% saying they’re now leading a healthier lifestyle than they were pre-COVID, up from 65% in 2019.
The UK Government is also under pressure to curb Britain’s obesity crisis, which is currently one of the highest rates in Europe. That’s why, in October 2022, promotions on food and drinks high in fat, sugar and salt (HFSS) in retailers will become restricted.
Food businesses are recognising the need for a sustainable mindset, with today’s consumers not afraid to switch to a competitor if you fail to meet their values. In fact, research from Deloitte found 85% of UK consumers are now making more sustainable life choices than they were two years ago.
Regulatory changes such as the UK Plastic Packaging Tax (PPT) are also pushing food businesses into finding more responsible ways to source their materials. In response, food companies have joined initiatives like WRAP’s ‘Plastic Pact’, that aims to tackle problematic plastics and help build a stronger recycling system in the UK.
Elsewhere, leading food to go operators Greggs recently announced it had hit several key milestones from its ‘Greggs Pledge’ made one year ago. Their achievements include establishing more than 600 Breakfast Clubs, feeding almost 50,000 children every school day, donating more than 1000 tonnes of food to charity partners and creating ‘healthier choices’ on shelf stores across the country.
4. Long term demand for delivery services
The last 18-24 months saw the demand for takeaway and delivery reach new levels, with over half of consumers (53%) saying they either used delivery for the first time or ordered delivery more often during the first lockdown. And this remains the case despite normal trading being resumed.
Major retailers such as Waitrose and Aldi have recognised this shift and made their products available on food delivery apps like Deliveroo, allowing customers to order food to go offerings without having to leave their seat.
This contactless approach not only appeals to consumers (who we mentioned earlier are striving for convenience), it also opens up the potential customer base beyond the usual lunchtime footfall.
5. Food waste prevention
Today’s consumers are more environmentally and socially conscious, opting for brands they see are taking steps to making the world a better place. Pledging to do better is one thing, but acting on those promises is more important than ever, not only to align with your customer’s values, but to also do your part in tackling the climate crisis.
Food waste continues to be a major issue in the industry, with it being responsible for 3.3 billion tonnes of CO2 every year. Recent research also found that if global food waste was a country, it would be the world’s third biggest contributor to CO2 emissions behind only the US and China.
To combat this, we’ve seen several creative and effective ways businesses are trying to tackle the food waste crisis. For example, the app Too Good To Go gives supermarkets, restaurants and retailers a platform to offer products at a heavily discounted price that would otherwise be thrown away. So far, the anti-waste app has stopped 17 millions meals from being discarded.
Not only can food waste reduction help the environment, but it can also help you improve your cost efficiency. Take Kellogg’s as an example, who have partnered with Seven Bro7hers Brewery to produce a beer made from cornflakes that didn’t make it through quality control. Initiatives like these can help food businesses consistently convert food waste from a loss to a profit.
The need to be agile has never been more important in the food industry…
Adapting your offerings to meet the changing needs of consumers and tapping into new trends as they emerge is key to staying at the forefront of the industry. And in today’s digital age, the landscape changes rapidly. In our guide, we assess the current state of the food industry and predict what it could like in the future.
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