Retail will account for 71 per cent of the market with eating out (foodservice) at 29 per cent this year, stated a recent report, suggesting that retail channels will start to steal share of stomach from foodservice in 2023.
According to new forecasts from IGD’s Eating In Vs. Eating Out report, total food and drink market across eating in and out is forecast to finish this year at +6.6 per cent vs 2021, with further growth for 2023 of +5 per cent.
Present figures show a recovery for eating out from the 21 per cent share in 2020 but still some way below its pre-pandemic share of 37 per cent. IGD forecasts that retail channels will start to steal share of stomach from foodservice in 2023. However, retail wins from foodservice will be mostly offset by down-trading by shoppers – cheaper products, buying less and switching to own label.
Growth will be driven by inflation. Real market value is set to decline in 2022 vs 2021. Retail has already been experiencing the impact of the increased cost of living on shoppers. In real terms, the UK retail market for food and drink will shrink in 2022 and fall slightly in 2023. Consumers are expected to trade down to cheaper products and switch channels to control their spending.
Nicola Knight, insight manager and eating out sector expert at IGD, said: “In 2020 lockdowns forced a strong switch from eating out to eating in, with 2021 showing a gradual return as venues opened and consumer confidence and appetite for going out increased. However, from Q4 2022 and into 2023 there will be a halt to this trend as retail channels start to steal share of stomach from foodservice, reflecting the challenging economic landscape.”
“Retailers are implementing a variety of initiatives to win and retain shoppers. These are mainly focused on promoting value and loyalty schemes. This looks set to continue into 2023 as shoppers remain very price sensitive.”