The value of UK food-to-go market is set to decline by £6bn in 2020 because of the coronavirus pandemic. However, Lumina Intelligence’s new UK Food To Go Market Report 2020 forecasts a recovery to 2019 levels by the end of 2022.
The food-to-go market in the UK experienced a decade of growth through the 2010’s. Lumina Intelligence valued the market at £21.3bn for 2019, a growth of 2.4%. However, the impact of the pandemic is set to result in a decline of 29% this year, taking the market value to £15bn.
Relative to the overall eating out market, food-to-go is somewhat insulated and as a result this decline is lower than that forecasted for the total sector. Consequently, Lumina Intelligence predicts that the share of the total eating out market held by food-to-go will increase to 27.4%, up from 23.3% in 2019.
The Government’s ‘stay at home’ message during the height of the pandemic resulted in 60% of people working from home, causing a major decline in city centre footfall. The report shows that the average number of food-to-go visits per consumer per month has dropped 25% year-on-year, with lunch the most impacted daypart, with a fall in frequency of 37%.
Coffee shops/cafés have been the strongest performers over the last year, increasing share across all dayparts but most significantly at dinner (+1.7pp). In terms of overall share, convenience store grab and go dominates the market at a value of £5bn – representing a 33% share of the total market in 2020.
Despite the significant reduction in value this year, Lumina Intelligence expects the food-to-go market to recover quickly due to its versatility, low contact and value-led proposition. By the end of 2021, the market is forecast to be worth £21.2bn, just behind its 2019 turnover.
Blonnie Walsh, Head of Insight at Lumina Intelligence said: “The sudden shift from a highly transient, on-the-go society, to one with restrictions placed on movement has had a catastrophic impact on the UK food-to-go market. With much of the UK workforce working from home or furloughed, footfall in city centres nose-dived.
“However, the sudden setback is not expected to last. The food-to-go market is forecast to grow by over 40% in 2021, returning the market value to around the 2019 level. The very nature of food-to-go, whereby it is not consumed on premise, it is relatively inexpensive and much of the customer base of the major players are already back at work, means the sector is well insulated for a swift recovery.”
NAM Implications:
- May be worth factoring in the possibility that home working of say 25%…
- …may become a permanent feature of the economy.
- i.e. consider key drivers:
- Cost/inconvenience of commute and childcare
- Cost savings for employers re reductions in desk space/usage
- All contributing to city centre street traffic/food-to-go consumption decline.
- Worth a what-if?
