On-trade

Pub foodservice levels to reach 80% of 2019 levels by ’22

Foodservice levels in pubs on the Island of Ireland should be back to nearly 80% of pre-pandemic 2019 levels by the end of 2022 according to Bord Bia in a new revised report on the Island of Ireland foodservice market.

 

While foodservice levels in pubs were down 64.6% in 2020, Bord Bia expects that there will be a slight increase in foodservice levels this year of 2.4% and its prediction for 2022 is for a 117.3% increase.

While foodservice levels in pubs were down 64.6% in 2020, Bord Bia expects that there will be a slight increase in foodservice levels this year of 2.4% and its prediction for 2022 is for a 117.3% increase.

While foodservice levels in pubs were down 64.6% in 2020, Bord Bia expects that there will be a slight increase in foodservice levels this year of 2.4% and its prediction for 2022 is for a 117.3% increase.

Its report found that last year, 2020, pubs’ foodservice levels were running at just 35.4% of 2019’s pre-pandemic levels and are expected to increase slightly this year to 36.3% of 2019 levels. However as hospitality opens more fully, 2022 is likely to see a healthy increase in foodservice in pubs to 78.8% of 2019 levels.

But the hiatus in service caused by the pandemic is also likely to see pubs lose share of Island of Ireland turnover to other sectors in the interim thus the report reckons that 2019’s 16% share for pubs will reduce to 14% in 2022.

The Irish foodservice market as a whole – including restaurants, hotel food and beverage, pubs, office catering and other segments that provide food away from home – will grow by 11% on last year (which declined by nearly 48% compared to 2019) to reach almost €5 billion by the end of this year.

In response to the ongoing impact of Covid-19 on Ireland’s foodservice industry and the knock-on effect on Irish food and drink producers, Bord Bia has published revised outlooks and a new report charting growth forecasts for the remainder of 2021 and into 2022 as the industry moves towards a full reopening. Bord Bia’s recently-launched revised report predicts an additional 56% (€2.8 billion) growth for 2022. Indeed, much of the surge originally predicted for the second half of this year has been pushed into 2022.

Last year, following eight years of consecutive growth, the foodservice market fell by a stark 47% (from €8.5 billion to €4.5 billion) and Bord Bia believes it will be the end of 2022 before the majority of the industry could return to close to the pre-pandemic levels of trade.

Previous Bord Bia reporting on the impact of Covid-19 provided preliminary forecasts for the Irish foodservice industry’s recovery in 2021 but the ongoing restrictions have been more longstanding and impactful than originally estimated.

 

Outlook on the Irish Foodservice Industry Post-Pandemic

The ‘Outlook on the Irish Foodservice Industry Post-Pandemic’ report, co-authored by global foodservice research specialists Technomic, has been developed to equip the industry and Irish food and drink suppliers servicing this market with up-to-date data and insights as they plan for the period ahead. It includes key trends and recommendations for businesses across the sector.

“Our end of year Market Insights report published in November 2020 documented the huge hit that the industry had taken as a result of Covid-19,” said Maureen Gahan, Foodservice Specialist with Bord Bia and co-author of the report, “At that stage we estimated that even in a ‘worst case’ scenario 2021 would see growth rates of 16%; however, we had not anticipated the length nor depth of the Lockdown that was to follow. This has resulted in a lowering of the overall expectation for growth in 2021 to 11%, lower than the ‘worst case’ scenario laid out late last year.

“That being said, foodservice in Ireland has displayed resilience in the face of the most prolonged shutdown in modern memory. The industry has shown adaptability, perseverance and tenacity to survive and with the assumption that the worst part of the crisis has passed, will begin to emerge and grow again in 2021 and beyond.

“We’re forecasting a strong second half to 2021 as the vaccine roll-out continues at pace, coupled with pent-up demand and consumer savings and we remain confident on the longer-term viability and resurgence of the industry.

“As the economy recovers and consumers grow more confident living in the age of Covid-19, this will see a parallel recovery in the Irish foodservice market.”

 

Trends and recommendations

The latest Bord Bia report outlines trends and recommendations for businesses as they forward-plan and adapt their positioning, products and services.

For example, even as dine-in reopens there will be a need for offerings that can easily transition from on-premise to off-premise occasions and provide a great experience.

 

Segment-specific expectations

The report states that, “Many pubs have not had their doors open for business in 16 months (since March 2020).

“Food-led pubs fared slightly better during Summer 2020 and in some instances, having been using delivery for survival, but this has been more the exception than the rule. Wet-led pubs are open for outdoor since June 7th but until all restrictions are lifted will continue to suffer at lower turnover rates. As a result, the pub experience is likely to see the largest change of nearly every foodservice segment until such time as Social Distancing is a thing of the past.”

The need for skilled labour was a concern even before Covid-19 but it is now further exacerbated due to job uncertainty experienced by many during the pandemic.

According to the report, “Coming out of the pandemic, foodservice operators are reporting challenges finding any type of labour and ongoing labour shortages could have longer term ramifications on industry recovery”.

Labour-saving solutions will continue to be sought after by foodservice operators.

David Henkes, Senior Principal at Technomic and the report’s other co-author, believes that Ireland’s foodservice industry and the Irish food and drink suppliers servicing this market are facing prolonged and significant changes due to the pandemic and many of these shifts will be permanent.

“This report highlights the key trends that have been identified and/or accelerated over the past 12-14 months,” he says, “For example, with the strong demand for off-premise food (including delivery, takeaway and drive-thru) restaurant models are adapting to accommodate what’s widely expected to be elevated demand, even as the pandemic ends. Seating areas are being re-thought, with more outdoor space being added. For some quick-serve restaurants, dining areas are being reduced in size or eliminated altogether.

“Meanwhile, technology has been a key enabler for restaurant and foodservice operator survival and success during the pandemic and further investment in this space will move forward at an accelerated pace while the importance of sustainability, particularly in packaging, but also in food waste, local sourcing and other critical areas, is expected to return and accelerate.

“Many of these changes are here to stay and we would encourage all foodservice operators and suppliers to remain informed and use these insights to refocus and reboot the foodservice aspect of their business in order to best service their customers as the market reopens.’

Bord Bia presented summary findings from its Outlook on the Irish Foodservice Industry Post-Pandemic report via an hour-long webinar recently.  

It offered a range of bespoke supports and services for foodservice operators and the Irish food and drink companies who supply the market. Some of the upcoming activities include a virtual Meet the Buyer event taking place at the end of September and the annual end-of-year foodservice seminar taking place in early December.

A full 2021 Irish Foodservice Market Report will be published in December with plans to include a section on consumer insights and changing customer behaviours as a result of Covid-19.

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