Trading through the eating out sector is likely to see steady growth this year, despite being a long way off peak 2008 levels, according to foodservice consultancy Horizons.
Total sales for the UK’s restaurants, hotels, quick service dining outlets, cafes, contract caterers and takeaways saw sales improve around 2% during 2014, with similar growth anticipated for 2015.
“It won’t be a meteoric rise this year, but sales are likely to see steady growth if consumer confidence continues to improve, prompting a rise in average spend,” says Horizons’ managing director Peter Backman.
Current global uncertainties, for example the ebola virus, the UK’s presence in Europe, and the outcome of the general election in May, mean that consumer confidence is, however, fragile.
Projected to experience growth, according to Backman, are product takeaways such as juice bars, Mexican street food and bakeries and coffee outlets. These occupy small outlets in high traffic areas, allowing consumers to satisfy their need to buy food when and wherever they want.
“We envisage this trend continuing as entrepreneurial operators come up with novel ideas for brands. It is these operators who will bring new food trends to the market by renting small, cost-effective spaces that larger brands can’t,” says Backman.
Horizons’ research envisages a year in which the bigger eating out operators are likely to grow further through acquisition, with smaller players being the inevitable targets.
“The larger players are now at the point where they will start to ask where further growth will come from,” he says. “The eating out market in some sectors is reaching saturation and overseas expansion is difficult for most, so acquisition through 2015 and into 2016 is the obvious answer. Investors are much keener on the eating out sector than they were and obtaining finance for deals will get easier.”