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Foodservice spend down 80% in April



Weekly spend in British foodservice fell to just over £200 million in April 2020, an 80% drop compared to the £1 billion spent in 2019, according to global information company The NPD Group.


In addition, the decline in British out-of-home (OOH) foodservice visits in April 2020 was almost three times as severe as the collapse seen during the financial crisis of 2008-2010.


Lockdown officially started on March 23rd, but many people were already avoiding eating out, meaning that by the end of Q1 2020 there was a 10% year-on-year deterioration in OOH visits. This decline accelerated dramatically in April and for the two-month period of March and April 2020 the fall was 54%.


According to the research, price and meal deal-related visits reached record levels in April while personal or online recommendations became increasingly important.


The importance of ‘quality’ offered by a foodservice outlet also rose by one third year-on-year, with consumers likely associating quality with hygiene.


Dominic Allport, insights director (Foodservice), The NPD Group, said: “The scale of the crash in out-of-home foodservice visits is unprecedented and the 80% fall in spend underlines the severity of the collapse. As we start to come out of lockdown, consumers are likely to be sensitive to prices and value for money.


“Value-related visits should increase rapidly in the same way as the 2008-2010 financial crisis when price-driven or voucher-driven visits rose sharply. We also expect deal-based visits to increase as they did in the financial crisis: they grew by over a quarter even though the overall market registered a 2% visit decline. The importance of meal deals is likely to grow as operators fight for market share.


“Operators are now more savvy about these deals, and they know that consumers that buy on ‘value’ can often spend more if the product range and offering is right. However, it’s important to sound a note of caution. While reopening and initial recovery is imminent, and the relaxation of social distancing is welcome, the eating-out industry has a huge task ahead if it is to return to anything like normal trading. The good news is this is an extremely innovative and creative sector, and we know it will adapt fast to create the ‘new normal’.”

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