Europe 2018 Foodservice Outlook


By Maria Bertoch, Foodservice Industry Expert Europe & Russia, The NPD Group

European foodservice markets are back to growth

Healthy foodservice visit growth is the story for all countries in Europe’s Big Five (Germany, France, U.K., Spain, and Italy), shown by our CREST® consumer data for the year ending September 2017. In addition, overall improvement in economic conditions in much of Europe has influenced consumer confidence – now at its strongest levels since 2010. What does this mean for the individual countries in the Big Five? And what’s ahead in the coming year?

Looking Ahead: The Outlook for 2018

All of the positive economic indicators we’re seeing point in the direction of overall traffic improvement in Europe’s out-of-home (OOH) market. Of course, foodservice still faces many challenges, so operators should not expect automatic growth in consumers’ OOH eating in 2018. Their habits are being shaped by such factors as technology and innovation, the desire for experiences, increasing competition within the industry, and more. Success in foodservice will depend on how the industry adapts to changing demands.

Here’s a look at those changing demands – our analysts weigh in on what’s happening and what’s next.

Digital: While technology is omnipresent in the modern world, the foodservice sector is still in its infancy where integration of digital tools is concerned. In the U.S. foodservice industry, 10 percent of all foodservice visits involve the internet or mobile apps for ordering and delivery. In Europe’s Big 5, it’s three times lower (3 percent of orders in YE September 2017). This is an area to watch in 2018.

Experience: For consumers, foodservice today is all about the experience. Whether replacing tedious and time-wasting household chores, living in the moment with intensity, sharing a meal or snack with friends, or being surprised by innovative concepts, foodservice is one of the rare industries that continue to create experiences that are shared in the real world, not on a screen. The challenge for operators will be to offer a unique and memorable restaurant visit experience using all tools: creative food offers, décor, outstanding staff, special events, and, of course, technology (think touchscreens for orders, a wine menu on presented on an electronic tablet, digital entertainment for kids while waiting to be served, etc.).

Blurred frontiers and increased competition: The foodservice market’s boundaries are in flux. Supermarkets increasingly offer restaurant-quality prepared foods; restaurant brands are featured on supermarket shelves; and the “groceraunt” concept, where supermarket customers can enjoy meals to eat in or take away, delicatessen-style, is growing both in the U.S. and in Europe. Operators will face increased competition based on this emerging trend.

The rise of Millennials and Gen Z: The industry’s focus will shift to younger generations. Millennials and Generation Z (those who are under 35 years old today) live in complete technological immersion, having grown up with the internet. Understanding who they are and how they differ from previous generations is critical for foodservice marketers. For example, these young adults have eaten lots of fast food in the course of their lives, so eating with their fingers is familiar. They judge a classic table-service restaurant as slightly out of date, maybe even boring. They want adaptable food options, easy to eat on premises or easy to take as on-the-go meals. Simplicity, health, freshness, transparency of ingredients – these are priorities, and fast casual delivers on them today. Millennials and Generation Z will represent six people out of ten on our planet in 2020! They will shape the future of foodservice. Building their loyalty is crucial to remaining relevant and keeping ahead of competitors.

Innovation: A decade ago, who could imagine eating a burger made from genetically grown meat? Or food based on insects? But now, plant-based protein meals, vegetarian options, and “free from” foods are taking more space on restaurant menus. Foodservice operators know the importance of maintaining a strong connection with the consumers they serve and adapting to the needs of new generations. Continuing to innovate will keep the industry exciting for consumers.

Get more restaurant industry outlook insights

While overall improvement of the foodservice industry in Europe is expected in 2018 and into 2019, not all parts of the industry will experience the same growth rates, and some may even decline. We have compiled a comprehensive  2018/2019 Foodservice Industry Outlook based on historic visit and sales data from Europes’ Big 5 countries and our analysts’ insights and observations. The result is the industry’s most detailed predictions across a range of foodservice segments and channels, to help you make data-driven decisions and plan for your future.

To learn more about the 2018/2019 Foodservice Industry Outlook or any of these insights, please contact your NPD account representative or email Guy Fielding at guy.fielding@npd.com.

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