Arena Round Table – March 15th 2024
In partnership with Rich Products
8 April 2024
Participants
Simon Stenning (Chair)
Strategic Advisor & Futurist and Founder of FutureFoodservice.com
Greg Bramwell
Director of Food and Beverage, BaxterStorey
Rachel Hartwell
Bakery & Desserts Buyer – Group Commercial, Bidfood
Philip de Ternant
Chairman, Creed Foodservice
Alana Newton-Terry
Head of Merchandising, Sysco GB
Laura Tighe
Managing Director – Healthcare, Elior UK
Adam Thomason
Culinary Director – Restaurant Associates
Charles Abraham
Director – Food Platform, Sodexo UK & Ireland
Dez Paterson
Sales Director, Rich’s
Event Review
Discussion revolved around current trends evolving within the current challenging economic landscape, with onus placed on consumers turning towards premium experiences to justify the growing cost of an out of home occasion. As specified in Future Foodservice’s 2030 Vision trend forecast report, the future of foodservice relies on suppliers, distributors and operators collaborating to create memorable moments for the consumer through food, whether that be a visit to a fine dining venue for a special occasion, or throughout their daily routine[1].
The roundtable agreed that the industry must remain informed of consumer trends and ensure a well-oiled supply chain from production to distribution to continue to exceed consumer expectations and sustain demand.
The UK foodservice industry, currently valued at £103bn[2], is very much in listening mode, operators are keen to respond to customer concerns surrounding barriers to growth with proactive, tailored solutions to suit individual business needs.
Food trends peaking amongst consumers in 2024
As we continue to traverse a challenge economic landscape, consumers increasingly look for value for money.
In a post-covid era, consumers look to maximise quality of life, connecting with each other and their food by savouring exceptional and memorable moments, which is where experiential and premium venues pull ahead[3].
Moreover, with the exodus of the workforce back to the office following the pandemic, day-to-day foodservice purchases have come to the fore once more, with consumers looking to well-known brands rather than independents[4] for their daily coffees and sandwiches as they trust the known quality and assurance that they will get value for money. Although bad news for independent business, chains and their foodservice industry suppliers will be able to absorb the profits brought by increased footfall and corresponding volume sales[5].
Sustainability and health remain key trends amongst consumers. Food provenance is important to eco- and health-conscious customers, particularly from within the Gen Z demographic, expecting to know exactly what goes into their food. Operators have a responsibility to make profit in a considerate way and to educate themselves on the sustainability and nutrition credentials and provenance of their products, expressing this knowledge both in marketing and in store to peak consumer interest.
The main challenges faced by the foodservice industry
There is concern that inflation may be set to rise again, particularly considering the minimum wage increase of 10% commencing in April 2024.
The current economic climate has resulted in menu pricing rising by 8% YoY; however, revenue remains flat. Consumers with squeezed budgets are less likely to splurge on regular out-of-home occasions, meaning that for more expensive venues and items volume sales drop and consumer dissatisfaction rises if quality is comprised to accommodate increasing operation costs.
Ongoing financial challenges across the board mean that hospitality outlets are shrinking, and independent venues are closing resulting in a reduction of business and revenue for the industry. Despite this, Future Food Service predicts that the UK economy will improve during the second half of 2024[6], ameliorating cost of living pressures and reducing strain on businesses, giving them a chance to recover.
Consumer choice is evolving, with budgets and health concerns front-of-mind customers are cutting back on indulgence, which is again where venues see reduced volume sales. The age demographic of consumer spend is changing also, with majority spending power now with the younger generation and retirees, who have more disposable income pre and post mortgage[7]. Catering to such a diverse audience, although a difficult challenge, is crucial to the future of the foodservice industry.
How the industry can respond to these challenges and opportunities
Roundtable consensus was that maintaining high standards of quality throughout the foodservice supply chain is key. This is where premiumisation comes in, venues must elevate their offering from both a menu and experience perspective to justify the increase in price and make consumers feel they are getting great value for money[8]. If consumers are not blown away by choice and creativity at a premium establishment, they will resent the additional cost. Although consumers may be visiting venues less frequently, they are likely to spend more on an occasional treat if a venue can deliver on ‘wow factor’.
Regarding the consumer tendency to lean towards established branded outlets or products, foodservice outlets should look to internally brand or put a face on their products in the manner of Marco Pierre White or Rich Products’ upcoming branded Rich’s baked goods range, to connect with and speak directly to audiences.
Attention must be paid to the business ethics behind suppliers to please operators, caterers, and customers ever more concerned with the sustainability credentials of their food. As it is difficult to accurately measure the carbon count, the foodservice supply chain must collaborate to ensure in depth data is available to be open about this on menus and answer questions should they arise.
Discussion also covered the importance targeting consumers at different purchase points throughout the day. For example, venues who can sweat assets all day, catering to the morning coffee connoisseurs as well as the evening pint drinkers, have greater opportunity to maximise sales. It was suggested that attempting to keep quick sale items as cheap as possible to ensure target audiences are appealed to at every opportunity with items that are guaranteed to improve their day-to-day.
What distributors and venues are looking for from suppliers
Suppliers offering consistent quality, minimal waste and a dependable, quick and easy service are highly sought after by hospitality operators. Foodservice representatives at the roundtable were more likely to collaborate with suppliers who could reliably get consumer favourite products into mass production to keep up with consistency.
Bidfood noted that companies are looking for volume rather than value, which is already up. This demand must be met by suppliers to accommodate shifts in contracts and ensuring that there is enough space to store stock.
Going forward, operators are looking to streamline processes with caterers seeking more services from one supplier. By minimising mileage and simplifying tasks, for example by delivering a variety of goods in one truckload and on one invoice, the industry will be able to save both time and money.
To reflect the consumer desire to connect with food, wholesalers and operators look for proof provenance and company heritage to ensure their offerings provide that all-important story-telling quality to draw a consumer in. This combined with product innovation and great flavour will impress operators looking to excite the consumer with an adventurous twist on classic favourites.
In Summary
Responding to consumer trends, needs and desires is key to ensuring a bright future for the foodservice industry.
Consumers are more conscious about what they’re putting into their bodies, meaning operators need to educate their customers on nutrition, provenance, and sustainability of food products. The story-telling capabilities of food and creative flair of a hospitality venue are key creating a remarkable consumer experience to ensure repeat purchases are made. Cost efficiency and quality must go together to sustain footfall and justify incremental prices.
The roundtable was a fantastic opportunity to various elements of the foodservice supply chain to engage on a customer/supplier basis and gain valuable insight into what each other are looking for.
To conclude, adding value to the lives of consumers through quality foodservice offerings will guarantee the longevity of the industry.
[1] ‘2030 Vision: The Future of Foodservice’, Simon Stenning, 2024, [2] ibid, [3] ibid, [4] ibid, [5] ibid, [6] ibid, [7] ibid, [8] ibid
If you’re interested in hosting or participating in a future round table event, please contact Lorraine.
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