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Eating out sector growth will be 'low and slow'

28 | 03 | 13

Recovery in the UK's eating out industry will be "low and slow" over the next three years, according to a report by research company NPD Group.

It predicts growth will be somewhere between one and two per cent per year. NPD believes consumers will "trade back" to the eating out sector this year, which will be welcome news for the industry, as it lost 90 million visits in 2011 and recovered only 14 million last year.

The findings of this report will be of interest to commercial catering equipment suppliers, as it may impact the nature of their business in the year ahead.

NPD also highlighted the growing importance of promotions, which accounted for a quarter of all meals and snacks eaten out of the home in 2012.

However, it claimed that with food prices set to rise as a result of inflation, operators must focus more on value.

Guy Fielding, director of business development for NPD, stated: "Consumers have become more controlled spenders, but not afraid to spend when they find good value, quality, and trust the product and its provider. So the way forward becomes clear. Winners will focus on 'menu value' not 'value menu'.”

Another key trend may be the growth of the breakfast market, which rose by eight per cent last year and is beginning to challenge lunchtime sales.

“The away-from-home morning meal is seen as more acceptable, and a necessity, and with our increasingly busy lives, starting the day with a takeaway porridge or toasted panini is more desirable and affordable than buying lunch out,” Mr Fielding commented.

Quick service restaurants are expected to do well in the year ahead and already hold a six per cent market share in the UK, which is larger than the four per cent it occupies in the US. Mr Fielding  described this area as “poised for rapid growth as new concepts open up rapidly and consumers respond favourably to the offering”.

This may appeal to family diners in particular, with research showing that people socialising over a meal to celebrate special occasions such as birthdays is becoming increasingly common.

Somewhat surprisingly, healthy eating does not appear to be a major concern when Britons eat out. NPD's research found that just three per cent of people are primarily motivated by “wanting something light/healthy” when buying meals or snacks outside their home. Use of words such as 'fresh' and 'natural' have more of an impact on how individuals perceive a meal rather than the calorie counts that have been introduced to UK menus.

The report predicted that areas of the industry that will suffer in 2013 are independently-owned pubs that don’t offer food, as well as takeaways and restaurants that are unable to adapt their offerings to compete with the supermarket meal deal.

It concluded by claiming the food service sector must be prepared to constantly adapt if it is to survive. Mr Fielding commented: “The British consumer eats out more than any other in Europe -142 times per person in 2012 - but their eating out habits have changed forever.

"From the breakfast, to family dining, to the rise of the fast casual sector, the message is know your customer, monitor your competitors and build on your strengths."ADNFCR-16001031-ID-801564000-ADNFCR

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