Food-to-go sector bouncing back to pre-pandemic levels

Food-to-go sector bouncing back to pre-pandemic levels

The food-to-go channel is again moving towards its pre-pandemic levels and will be worth £15.6bn at the end of  this year, IGD has predicted.

The food and consumer goods insight specialists said that by the end of 2021 the channel will have risen to 82.5% of its 2019 value, reclaiming much of the ground lost during Covid lockdowns.

Senior analyst Nicola Knight said: “This is a better-than-expected result, so is really positive news for the sector.

“By 2026, the market will be worth £22.7bn which is 20.5% more than 2019. This will be the outcome of five years of growth at above pre-pandemic levels, following significant contraction in 2020, and will predominantly be driven by foodservice operators.

“To survive and meet new demand, operators have fast-forwarded innovation at an unprecedented speed. Delivery, digital and proposition development have placed survivors in a good position to maintain momentum as restrictions ease. But it’s important to note that QSRs, coffee shops and food-to-go outlets may experience a dip in sales growth in the second half of this year, as consumers have more choice on where and how to spend their money.”

‘Adapt to changes’

In retail, the share of the food-to-go market is forecast to reduce to 21% in 2021 from 24% in 2019. This will gradually increase to 23% by 2026 as momentum starts to return to retail food-to-go.

Knight added: “In 2021, retailers have faced increased competition from foodservice operators who adapted quickly to changing consumer habits and demands. And, due to the decrease in demand and shift in shopping habits, retailers reallocated space to other categories.

“While larger stores have benefited from consolidated shopping missions, smaller stores have experienced a greater dip in sales but, conversely, are likely to recover more quickly as some pre-pandemic behaviours return.

“Whilst there have been some new product launches and major projects that were delayed due to the pandemic are now beginning to appear in stores, the challenge for retailers now is whether they can close the gap in market share. It will depend on how far consumers return to pre-COVID habits and how fast retailers adapt to changes in behaviour that stick.”

The annual Food-to-Go forecast report from IGD examines in detail the outlook by sector for: convenience, forecourts, QSR, coffee shops, food-to-go specialists, supermarkets/hypermarkets, and other retailers.