Consumers are now demanding red meat more often while swapping three courses for two; café chains are on the increase while independent cafés are falling; and retailers are now cooking from scratch more often to save on costs.
According to BIS Foodservice’s Australian Foodservice Market 2012 report, consumers continued a trend to trade down in their choice of outlet, and while they are still dining out for lunch and dinner, they are not doing so as often nor do they spend as much money.
“Many foodservice operators are finding that their customer base has shrunk significantly, with meal services as a whole much quieter,” says Sissel Rosengren, Head of BIS Foodservice. “Consumers are watching their money now and are much more frugal in attitude and spending.”
However, the Australian foodservice market expected to grow once again after five years in decline.
Consumer habits
In the 12 months prior to June 2012, the number of food service outlets in Australia declined by one per cent overall, driven largely by a 1.1 per cent decline in commercial outlets. Café chains grew by 5.2 per cent in 2011, while independent cafés and bakeries with cafés declined. Fast food chains grew by 3.8 per cent in 2011, but a further decline in independent fast food outlets – combined with a significant decline in snack food chain outlets – led to an overall fall in the Quick Service Restaurant (QSR) channel of 1.7 per cent. Restaurant numbers declined by 2.6 per cent last year, and function caterer numbers declined 7.3 per cent.
Overall, these numbers reflect the current economic times and fluctuating consumer confidence. And while Australians have continued to eat out since the GFC, they do not eat out as much and there has been an evident trade down effect among consumers in terms of where and what they are eating, and how much they are spending when they do.
There has also been a return to „comfort foods‟ with demand for fish & chips and bangers and mash on the rise.”
Overall, food service operators experienced a growth in demand in terms of food and non-alcoholic beverages served in their outlets in seven different product categories in 2011.
Consumers are demanding red meat more often with 21 per cent of outlets reporting an increase in demand for the product. Coffee demand continues to rise, and poultry also was in high demand among consumers.
Operator trends and business confidence
Many restaurant operators believe 2012 will be another “lean and trim” year in which it will be vital to watch costs in order to stay in business. As such, operators are minimising costs where possible.
“Restaurants are now keeping staff numbers at a minimum, with those staff expected to multitask,” says Rosengren. “Chefs in some places are now expected to take orders, wash dishes and make coffee.”
Operators are now preparing more food from scratch in order to reduce food costs. This trend is also influenced by an increased preference for fresh produce among consumers, as well as locally sourced products.
Foodservice market since the GFC has been “volatile”
Retail turnover of restaurants, cafes and takeaway services proved to be extremely volatile in 2011, as it was during 2010. Turnover fell by 1.3 per cent in January 2011, during the only peak season on the Australian foodservice market. It rose one per cent in February and flatlined in March, before an unexpected decline of two per cent in December 2011 was offset by a 4.2 per cent spike in January this year.
Foodservice market outlook to 2015/16
But it’s not all doom and gloom for the industry. According to BIS Foodservice, the market is expected to grow year-on-year for the next five years. The report found that confidence among foodservice business operators was up despite the total number of outlets – as well as overall turnover – declining last year.
“The market as a whole is forecast to grow steadily over the next five years following declines over the previous five years,” says Rosengren. “Businesses are now adapting to evolving consumer demand and understand the need to offer the full service to customers in order to retain regulars.”
