Success in 2017 will be about showing flexibility, thinking ‘classics with a twist’, ramping up local suppliers and being conscious of healthy choices and ethical concerns, according to The NPD Group.
1) Respond to the delivery revolution
Delivery is not new in foodservice but it is growing quickly thanks to an aggressive push by aggregators and non-food providers. With consumers enjoying greater choice than ever, operators are finding it more and more difficult to maintain customer loyalty.
Winners will need a flexible business approach. This could mean introducing a delivery service, or opening take-away-only outlets to complement a traditional sit-down restaurant format. Or it could mean partnering with the most relevant delivery aggregator. Speed of delivery and excellent product quality will be key to a great customer experience.
2) Deliver an increasingly high experience
The foodservice industry is facing a storm of cost increases from the National Living Wage (NLW), inflation, weaker sterling and growing business rents. There is already an impact on prices and they are expected to grow further in 2017. At the same time, consumer confidence will remain fragile so consumers will remain cautious about how they spend their money. Quality will be more important than ever.
Winners will need to focus on maintaining the quality of their food and drink offerings and retain menu diversity while delivering an ever better customer experience. With the eat-out market offering a dizzying array of choice, engaging with customers will be key to driving loyalty and repeat visits.
3) Find local food suppliers but don’t sacrifice quality
Consumers are increasingly looking for good quality food; they won’t accept low quality. While sterling was strong, operators could use suppliers around the world to source the best quality products such as high quality meat from South America while still controlling food costs. But the weakness of sterling, inflation and the impact of the NLW will force operators to find local suppliers capable of providing high quality products on a commercial scale.
Winners will be the operators that source locally. They will benefit from consumer approval of local provenance and support for British farmers.
The foodservice industry is facing a storm of cost increases from the National Living Wage (NLW), inflation, weaker sterling and growing business rents”
4) Cater for ‘healthy choice’ and ethical consumers
While consumers do not always opt for the ‘healthy choice’, they are increasingly on the lookout for such menu options. Why? Because for many consumers the availability of a ‘healthy choice’ is a reassuring sign of quality. Yes, this adds menu and sourcing complexity for operators as ‘healthy’ or ‘healthier’ food can mean vegetarian, vegan, low fat, low calories, gluten-free, or simply the increasing use of fresh ingredients. But it needs to be taken seriously. Consumers are also seeking ethically-sourced and locally-sourced ingredients and are concerned about limiting food waste and protecting the environment.
Winners will be the operators that meet the demand for ‘healthy choice’ menu options while maintaining their core menu appeal. Operators that understand consumer sensitivity to sourcing, waste and environmental protection will find it easier to succeed.
5) Offer a new twist on a classic
Consumers love seeing a wide variety of food and drink on a restaurant menu, and many operators have successfully catered for this need. Yet consumers are also creatures of habit who – when it comes down to choosing something from a menu – will often be happiest enjoying a classic or traditional dish. If done well, a new take on a classic dish will wow the customer and keep the menu fresh.
Winners will be those operators who can offer the reassurance of the traditional dish while adding a surprising twist that wins the customer’s heart.
Cyril Lavenant, NPD’s director of foodservice UK, says: “The competition within the £50 billion British foodservice industry has become intense in recent years and operators must constantly adapt to satisfy ever more demanding consumers, who are now not only thinking about their own health but also about the impact of their actions on the environment. Britain’s foodservice industry is also facing big external challenges which might have a long-term impact on operators. But the industry has responded to challenges in the past and will do so again. Foodservice operators know the importance of maintaining a strong connection with the consumers they serve.”