A new survey suggests that the recent surge in global food prices could drive consumers away from eating out in restaurants and into discount retailers.
Food inflation is currently running its highest since the 1970s. Recent data from the United Nations Food and Agriculture Organization (FAO) showed that global food prices were up 32.9% in August from a year earlier, with vegetable oil, grains and meat on the rise. This has been caused by production and supply chain issues in some markets in the wake of the pandemic.
The GlobalData survey confirmed that a growing number of people are cooking from scratch at home, with 91% of respondents globally saying that they had either started to, continue to, or are doing this more frequently, which suggests that this trend is here to stay.
Hannah Cleland, Consumer Analyst at the research, commented: “Higher food prices combined with the ongoing economic impact of the pandemic will inevitably shift consumer spending priorities away from non-essential/luxury items like visits to hospitality venues, bars and restaurants and towards making savings on the household budget with more discount grocery shopping.
“Restaurants could be affected by this as more people may opt to stay at home and cook rather than going out for a meal”.
She added: “Although many people are on tightened budgets, there are opportunities for restaurants and foodservice outlets to capitalize on their access to higher quality or specialist products compared to those available to consumers in supermarkets and discounters.
“An effective service that has already gained traction during the pandemic is meal kits and the same GlobalData survey found that 53% of global respondents have started to, continue to, or are using meal kits more frequently. Meal kits provide a way for food outlets to continue engaging with consumers who can’t afford to eat out and cuts the overhead costs for businesses running a bricks & mortar venue.”
