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FOOD-TO-GO SPOTLIGHT, in association with Fri-Jado

Food-to-go

The food-to-go space in the UK is set to grow a healthy 32% in 2022, to a value of £21.3 billion, according to data from Lumina Intelligence.

This will see the market fully recover to and exceed its 2019 pre-pandemic market value and follows growth of 38% in 2021.

Key food-to-go channels including convenience and supermarket grab-and-go, coffee shop/cafés as well as travel are expected to surpass 2019 turnover in 2022.

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Branded traditional fast food is expected to have a slower recovery, with delivery gaining large proportions of the sales mix for key operators. Travel, coffee shops/cafés and street food are expected to see the strongest growth in share.

Convenience store grab-and-go remains the largest channel in the food-to-go space, with 28% of the market, but the channel is losing share to higher spend food-to-go specialists as consumer quality expectations increase.

Lumina notes that operators across the food-to-go market, including Greggs, Costa Coffee and Pret A Manger, are diversifying outlet coverage in line with changes to consumer habits following the pandemic, with operators targeting more drive thru, travel-led sites, as well as neighbourhood and suburban locations.

Blonnie Whist, insight director at Lumina Intelligence, said: “During the pandemic, the very nature of food-to-go was hampered by tight restrictions on movement. However, the channel has always been well-placed to recover post-pandemic. This is apparent in our forecasts, which indicate a full recovery by the end of 2022. This growth is set to be driven by a number of factors.

“Firstly, the reopening of hospitality, as well as recovery in city centre footfall, will drive food-to-go occasions as more consumers return to offices at least some of the working week. Secondly, recovery in travel and tourism will boost food-to-go throughout key parts of 2022, including the summer months. Thirdly, food-to-go is a relatively low ticket item and is well-placed to capitalise on tighter budgets as consumers feel the impact of cost increases across food, fuel and utility bills as well as taxation.”

Kitchen projects

The top 10 brands account for around a third of the overall food-to-go market and with 30% of adults having a “food-to-go occasion” each week, it is no surprise that many are firing up their new project engines after putting expansion on hold during the pandemic.

Caffe Nero is among the brands to have resumed its store openings programme. It has just unveiled plans for flagship branches at Stansted Airport and Belfast Airport, while a further six stores are set to open across the UK by early summer, with the company targeting urban centres and market town locations. Additional sites are being scoped and screened for further openings later in the year.

“As the UK emerges from pandemic restrictions, we are looking to return to growth by resuming our store openings programme,” said founder and group CEO, Gerry Ford. “We have several new stores in the pipeline scheduled to open over the coming weeks and I’m excited by all of them.

“Customers are talking with their feet and we are already seeing customer numbers increase week by week. We will be looking at other new sites moving forward as there seem to be a lot of very good opportunities out there.”

Greggs, meanwhile, has said that 2022 will herald its “next generation of shop refits” as stores are equipped to support its multi-channel model. The new design, which will set the standard for store layout moving forward, will see it create dedicated space for digital channels and increased capabilities in food preparation. It will initially be introduced to around 200 shops, accounting for 10% of its estate.

Greggs said it will also continue to improve the quality of its estate through relocations, seeking larger, better premises offering more channels, and coffee shop seating where appropriate.

Trading hours

In addition to new shops, the company said it has identified a “strategic opportunity” to extend trading hours in many of its shops to compete for food-on-the-go sales in the evening. Market research shows that sales after 4pm accounted for 35% of food-to-go sales in 2021, the largest proportion of the market by time of day.

Greggs shops typically close at around 6pm and therefore it currently accounts for just 1% of this ‘dinner time’ market by value compared with nearly 8% of the lunchtime market and 11% of the breakfast market, according to NPD/Crest figures.

With 86% of demand in this dinnertime market being ‘take out’ in nature, Greggs said it is “well-positioned” to compete for sales provided it can tailor its menu to meet customer expectations at that time of day.

Initial trials in 100 shops show that by combining walk-in with delivery sales, offering the existing menu, it can already grow the evening daypart to an average of 17% of daily sales. In 2022 it will extend late opening, with delivery service, to a total of 500 shops, including hot food menu trials and supported with marketing activity.

Many of the leading food-to-go operators have also unveiled plans to improve their sustainability credentials moving forward.

Costa Coffee intends to accelerate its carbon transition after committing to halving carbon emissions per serving of coffee by 2030, with a target approved by the internationally recognised Science-Based Targets initiative.

To tackle the emissions that sit within Costa Coffee’s direct control, the company has begun to create a transition roadmap to help it achieve its goals. The roadmap builds on the work that Costa has been doing for many years, including at its UK company-owned stores which have used 100% renewable electricity since 2017.

Moreover, since the start of 2022, its UK roastery is powered by 100% renewable gas. The brand is also now working with Climate Partner to source high-quality credible carbon offsets for those emissions which are currently unavoidable, and continues to develop and implement plans to increase energy efficiency and expand the use of renewables.

Costa Coffee’s global brand and sustainability director, Deb Caldow, commented: “We are proud of the progress we’ve made over the years at Costa Coffee across all elements of sustainability. Committing to a SBTi-approved target helps us set a pathway to achieving significant carbon reduction; it is the right and necessary next step.”

For food-to-go operators, balancing carbon management with the operational challenges of menu development and speed of service is par for the course as the sector strives to improve on the position it was in prior to the pandemic.

The Food-To-Go category of the 2022 Market Landscape Report is supported by Fri-Jado. For more information please visit www.frijado.com or call 01895 272227.

Tags : food-to-goFri-Jado
Andrew Seymour

The author Andrew Seymour

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