On-trade

Pubs: 24% share of foodservice market

At €1.55 billion, pubs enjoy a 24% share of the €6.37 billion Island of Ireland foodservice market which is over twice that held by the full service restaurants at €705million (or 11%).

In fact pubs have the second highest share of this foodservice market after quick service restaurants which have €2.47bn or nearly 40% of the market. Pubs spend €403 million a year on foodservice purchases.

However pubs’ share of the foodservice market is slipping, showing a Category Annual Growth Rate of -1.7% between 2012 and 2015 and Bord Bia predicts that the pub’s share of the Irish foodservice market will flatline to 2018.

This contrasts with 2.0% growth in the total commercial market over the last four years which is predicted to grow even faster – by 3.1% over the next three years.

These were among the findings contained in Bord Bia’s Quick Service and Food-to-Go Insights Report 2015, published today.

Foodservice is the term used to describe all food consumed out of home, from restaurants, hotels, coffee shops and bars to workplace catering, hospitals, education and vending.

Bord Bia predicts that this foodservice market will grow from €6.13 billion in 2014 to €6.9 billion in 2018, thanks mainly to a growing economy, rising tourist numbers, falling unemployment, a continuation of the 9% VAT rate and improving consumer confidence.

The report is being launched at Bord Bia’s annual Foodservice Seminar, which takes place at the Aviva Stadium today, attracting close to 300 Irish food suppliers and foodservice trade buyers. Delegates will hear presentations from a number of industry experts including senior representatives from McDonald’s Ireland, BWG Foods and Greggs UK on new foodservice business trends and changing consumer habits.

“It’s encouraging to see that the sector is continuing to grow at an even faster rate than was forecast this time last year,” commented Bord Bia’s foodservice specialist, Maureen Gahan, “Overall, Ireland is still viewed as a growth market for both domestic and international chain operators and opportunities exist for Irish food and drink suppliers that have the capacity to service them.

“Consumer culture is evolving, with new demands being placed on restaurant operators. According to our survey, fast service, fair price and transparency are three of the most important characteristics for diners,” she added.

In advance of today’s event, Bord Bia also commissioned consumer research to gauge Irish consumer trends while eating out.

Some of the key survey findings include:

 

  • 62% believe it’s important to support restaurants that are supporting local operators
  • More than half are looking for menus using fresh ingredients when they’re eating out. Ingredients related to artisan and craft items are gaining attention too
  • 48% frequently make special requests to customise menu items. Convenience and customisation are key factors that today’s Millennial generation are looking for when eating out and restaurants responding to these demands are winning market share
  • Nearly 6 in 10 (58%) claim premium coffee is important to them. An affordable luxury that has shown resilience through recessionary times, foodservice operators recognise that coffee can act as a major footfall driver
  • Some 55% of those surveyed said food sourcing and transparency is important when dining out. Transparency is still very much on trend and it covers everything from provenance of ingredients, food integrity and sustainable supply chains, to fresher and better quality food offerings and healthier options on the menu. Those aged 25 to 44 are most concerned with transparency

 

In addition to analysing the sector’s overall performance, the Insights report also highlights:

  • That ‘Better-for-you’ positioned foods are viewed favourably by consumers. Better-for-you ingredients are growing in importance as they provide a “health halo” for menu items that can help operators differentiate from the competition in a manner that’s highly relevant to their customer base.
  • The role that technology plays in how outlets interact with their customers which cannot be underestimated and is changing the face of how they build loyalty programmes to facilitate pre-order, cashless transactions and redefining take-away with online delivery services such as Deliveroo and Just Eat.

 

Fast Casual sets the pace of growth

The Fast Casual channel in Ireland is forecast to grow at three times the rate of overall market growth, driven by more robust consumer spending, a high degree of interest in the menu variety and the ability for consumers to customise menu items.

Fast Casual is the term used to describe outlets that provide quick service and counter service, but with higher price points, more innovative offerings and an enhanced overall eating experience compared to traditional fast food.

Examples include Rockets by Eddie Rockets, Tolteca Mexican restaurants and Five Guys ‘Better Burgers’.

Consumers are willing to pay somewhat higher price points in exchange for a higher quality, enhanced dining experience that’s perceived to be healthier in general.

 

 

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