Food-to-go market to return to pre-COVID levels in second half of 2022
QSRs in particular, were credited for being the main driver of growth.
The food-to-go market is recovering faster than expected, with IGD forecasting it will return to its pre-COVID levels in the second half of 2022.
The insights agency said the sector will be worth £15.6 billion at the end of 2021, already 82.5% of its 2019 value.
“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,” explained Nicola Knight, a senior analyst for food-to-go at IGD.
QSRs in particular, were credited for being the main driver of growth, increasing market share from 77% in 2019 to 79% in 2021. IGD cited COVID-19 restrictions playing a “significant” role in this, due to consumers “suffering from cooking fatigue and opting for affordable treats, which has in-turn benefitted “destination” food-to-go sites.”
“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,” Knight added.
In retail, the share of the food-to-go market is forecast to decrease to 21% in 2021 from 24% in 2019. However, IGD expects this to gradually increase to 23% by 2026 as momentum starts to return.
“While larger stores have benefitted 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,” Knight said.
“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.”
