The Top Three Quarterly Trends Shaping the Great Britain Foodservice Industry

Consumer confidence in Great Britain continued to be positive in the first quarter, but it dropped slightly at +1 compared to +4 at the end of December.

At the end of February, a date for the European Union referendum was confirmed, and Britons got ready to make what has been described by some as the “most important decision in a lifetime.” They will decide whether the U.K. will continue as a member of the European Union. In the context, uncertainty has already started to hang over the British economy; the pound started to lose some of its value, and the U.K.’s GDP growth slowed down to only +0.3 percent year-on-year growth in Q1 compared to +0.7 percent experienced in Q4 15.

However, this uncertainty has not had an impact on consumers’ spend out of home, as it kept on growing in Q1 16 by +3.3 percent. That is only slightly lower than the +3.6 percent growth in spend witnessed in Q4 of 2015. This represented an additional £295 million consumer spend compared to the same quarter last year.

Growth was driven by a balanced mix of traffic and average spend per eater increase, which rose by +1.7 percent and +1.5% respectively.

In this edition of Topline Top 3, we witness the strong growth of snacking in Q1, observe the return of families, and we look at the importance of aggregators.

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Snacking performance in Q1 again showed hope for long-term recovery

As we saw in Q2 2015 with an impressive +4.0 percent growth in snacking traffic, we hoped for a return of the daypart after long-term decline. However, flat performance in Q3 2015 (+0.5 percent) and even a slight decline ( -0.9 percent) in Q4 2015 made us believe this was a momentary trend.

Q1 performance gives us hope again. Indeed, we observed +1.5 percent growth in PM snack, in line with the traffic increase experienced overall during the entire day.

Source: The NPD Group/CREST®

Families are back to the foodservice sector

More encouraging news comes from the confirmation of families’ return to the sector.

Indeed, the end of 2014 and the beginning of 2015 showed decline amongst those parties. The reprise of family visit growth in Q3 2015, at +1.3 percent compared to a year ago, accelerated even more during the last quarter of the year, at 2.4 percent.

This quarter we saw families’ return to foodservice confirmed with an impressive +4.2 percent traffic gain compared to the same quarter in 2015.


Source: The NPD Group/CREST®

Nonetheless, Easter being in Q1 this year may have slightly influenced this trend.

Aggregators are taking over traditional delivery and takeaway

Seeking super convenience, consumers are increasingly using aggregators to get their foodservice meals in the comfort of their homes.

Source: The NPD Group/CREST®

Looking at dinner only, we see that in Q1 2016, 4.6 percent of overall foodservice traffic came from aggregators such as Just Eat, Hungry House, and Deliveroo.

Aggregators account for almost a third of all deliveries in the market. 

Overall, we were wondering if the positive performance of the last quarter of 2015 was a good omen for 2016. Looking at first quarter of 2016, it appears last year’s Q4 did portend a strong Q1 2016.

Upcoming European sporting events could mean the good industry performance and positive trends will continue. However, with a slowdown of the general economy and political uncertainty related to the EU referendum, consumers could become a bit more cautious.

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