Branded chains and fast food concepts to lead eating out sector growth

By Peter Ruddick

- Last updated on GMT

Related tags: Restaurant, Eating, Food

Branded reastaurant chains and the fast food sector are to lead growth in the eating out industry, according to a report from Allegra Strategies
Branded reastaurant chains and the fast food sector are to lead growth in the eating out industry, according to a report from Allegra Strategies
The branded restaurant sector is to grow by more than 20 per cent in three years and fast food operators are to spearhead growth in the eating out industry, according to the Allegra Project Restaurant 2012 report from Allegra Strategies and Barclays.

The report asked around 12,000 consumers and nearly 300 industry leaders about eating out habits and forecasts for the industry as a whole. According to the experts the eating out sector is set to grow by nearly 6 per cent in 2012 to a total of more than £11bn.

The branded restaurant chains will be behind a lot of that growth as the sector is forecast to grow by 22 per cent to nearly £14bn in the next three years. The report says eating out is becoming ‘increasingly ingrained in consumer behaviour’.

According to the research around half of all consumers surveyed say they eat out just as much as a year ago while 13 per cent say they actually eat out more often. Although more than 25 per cent of those are visiting cheaper restaurants in the difficult economic climate.

Innovative

Anya Marco, director of insight at research consultancy Allegra Strategies said operators would have to continue to manage price expectations from consumers. "The report shows that visit frequency is expected to remain stable and regardless of prevailing economic conditions, people are determined to continue to enjoy themselves when they can," she said.

"Successful operators in the branded restaurant market recognize the pressures on household budgets.  By focusing on more innovative ways to deliver value for money, it is these operators who are benefiting most. The strength of a brand should not be underestimated in the restaurant market," Marco added.

Discounting

The study echoes findings in the latest Peach BrandTrack report which indicated restaurants have their ‘work cut out’ to move away from discounting​ when voucher use appears to be continuing to rise.

Of the consumers surveyed in the Allegra Project Restaurant 2012 report, nearly 20 per cent said they would stop regularly visiting a restaurant if it stopped offering discounts.

More than half of the consumers also said they regularly use restaurant vouchers; a statistic acknowledged by operators with 45 per cent expecting the use of discounting to become more widespread and over half saying they believed footfall would drop if they removed offers.

Other findings in the Allegra Project Restaurant 2012 report include:

  • Fast food operators, including health-conscious outlets, will outperform the sector as a whole with growth of 6.7 per cent this year.
  • In the next year 70 per cent of consumers surveyed expect to eat out at the same rate.
  • Italian remains the nation’s favourite eating out cuisine followed by Indian food.
  • Men are more likely to spend more than women in restaurants, and the over-60s spend the most out of any age group.

The full report will be launched at the Allegra Group’s Eating Out Europe Summit on 26 June.  

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