Food-to-go on the move to £23.5bn by 2022, IGD forecasts

Date : 09 August 2017

The UK’s food-to-go sector is in rude health and will be worth £23.5bn by 2022, up from £17.4bn in 2017, according to IGD, as shoppers’ preference for eating on the move shows no signs of slowing down.

IGD’s food-to-go research splits the market into five segments, with the organisation’s latest forecasts suggesting particularly strong growth among specialist food-to-go retailers (e.g. Greggs, Subway, Pret, EAT and Leon), which are set to overtake quick service restaurants (QSRs) to become the biggest part of the market in the next five years.

  2017 value
(£bn)
2022 value
 (£bn)
CAGR 2017-2022
 (%)
Food-to-go specialists 5.1 7.7 8.4
Quick service restaurants (QSRs) 5.4 6.3 3.4
Coffee specialists 2.9 4.2 7.4
Convenience, forecourt & other retailers 2.7 3.6 6.1
Supermarkets & hypermarkets 1.3 1.7 5.9
Total 17.4 23.5 6.2

Gavin Rothwell, Senior Insight Manager at IGD, says: “As shoppers become more sophisticated in their tastes and demands, so too does the UK’s food-to-go market. Across all our five market segments we’re seeing some highly innovative product and menu development, much of this inspired by shopper trends towards health and wellness and global flavours and tastes. Many operators are looking to tempt shoppers with ranges tailored to different times of day, while also improving the quality of their fresh food and coffee offers.

Food-to-go specialists are really setting the pace on product innovation and range development, as well as expanding quite rapidly outside London, which is why we’re forecasting them to become the biggest part of the food-to-go market by the end of 2022. In addition to the well-known high street names, there are several new players emerging in this segment as well. Health and wellness is a particularly big focus for these specialists, with three-quarters (76%) of shoppers satisfied with the choice of healthy options available in-store, higher than any other segment of the food-to-go market.

“Although we expect food-to-go specialists to become the biggest part of the market by 2022, QSRs are also set to grow well over the next five years, with 83% of the food-to-go shoppers who visit these stores satisfied with their overall experience. Many QSR chains are updating their menus and reinventing the in-store experience to bring in more technology, creating a more premium look and feel to appeal to younger consumers. There are also many newer players emerging and expanding across the UK in this segment.

“Food is also a growing focus amongst coffee specialists, many of whom are now pushing the boundaries with menu upgrades and ranges tailored to different times of day, especially breakfast. Hot drinks remain the most purchased food-to-go product at breakfast, bought by half (49%) of shoppers, but over the last year there’s also been an overall rise in the number of products bought on a breakfast mission, including hot food (20%) and fruit (24%). There’s also a wave of smaller chains and niche independents innovating in this part of the market, all of which is encouraging larger coffee specialists to innovate with their own ranges too.

Convenience and forecourt retailers have spotted a great opportunity in the food-to-go market and are now becoming increasingly active in this area, either through their own ranges or by teaming up with well-known brand names to add credibility. Younger shoppers are particularly likely to drive growth in these stores, with 18-25-year-olds twice as likely to buy food-to-go in convenience stores compared to their older counterparts.

“The same goes for supermarkets and hypermarkets, which are increasingly devoting more space in-store to food-to-go. Many are expanding their own ranges as well as creating new partnerships with suppliers to introduce more diverse in-store experiences, such as sushi bars and juice bars. With over half (55%) of food-to-go shoppers visiting a supermarket, there’s clearly plenty of opportunity for these stores to perform well in food-to-go.”

For both food-to-go operators and suppliers, there’s plenty to play for, adds Gavin Rothwell. He says: “In future, we expect to see the five market segments we’ve identified become increasingly blurred, as specialists and grocery retailers continue to combine great fresh food-to-go ranges with excellent drinks offers that tick the boxes for shoppers when it comes to quality.

“It’s common for shoppers to visit more than one store to complete their food-to-go shop, especially at breakfast (53%) but also throughout the day. Suppliers to the food-to-go sector therefore have a great opportunity to work closely with retailers and specialists to create winning ranges that will ultimately meet more shoppers’ needs, making their lives easier.”

Visit igd.com/ftg2022 for more information. To keep up with the latest trends on food-to-go, sign up to IGD’s monthly newsletter

ENDS

Notes to editors:

  1. IGD is an education and training charity for the food and grocery industry that undertakes research for the benefit of the public. Our in-depth understanding of shoppers, retailing and supply chains is supported by our knowledge of broader topics affecting the industry – health, nutrition, sustainability and economics among them. This gives us unparalleled insight that can help identify opportunities to improve performance and tackle business challenges. Our reach is global, with experts based in the UK, Singapore and North America. We invest the net income we make from selling our expertise back into our charitable activities
  2. We define the market based on sales of food-to-go operators and a proportion of sales of relevant, food-to-go products from retailers. The core methodology is based on a bottom-up approach, building up total sales of key operators in the channel, plus a top-down approach benchmarked against ONS spending figures for relevant sectors
  3. All shopper data is derived from IGD ShopperVista
  4. Food-to-go specialists include operators such as Pret A Manger, Greggs, Subway, Leon and Chipotle; coffee specialists include operators such as Starbucks, Costa Coffee and Caffe Nero; and QSRs include operators such as McDonalds, Burger King and KFC
  5. All figures correct at time of going to press

For more information contact:
Laura Roberts on:
press@igd.com or +44 (0)1923 851 986

Infographic: Food-to-go on the move

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