UK Eating Out Market Set for Growth While US Suffers

The total UK eating out market will continue growing over the next 18 months, according to foodservice analyst Horizons. It is estimated to increase by £850m to a new value of £42.8 billion maintaining the same modest 2% annual growth seen in recent years.

In contrast, the US eating out market has been hit hard by the downturn, suffering an estimated accumulative fall in value of 5% over the last three years.

 “The way US operators are dealing with it, especially in the quick-service market, is by slashing prices,” says Peter Backman, managing director of Horizons.  “McDonalds has done well and upheld its prices and its point of difference, but there are hundreds of other burger chains which are slashing prices and eroding customer loyalty.  This is a downward spiral which is very difficult to climb back out of.”

Back in the UK, however, the cost of eating out has risen, says Horizons.  The average cost of a starter has increased 8% to £5.27 over the last 12 months, a main course has increased 1.4% to £8.98 and the price of a dessert has gone up 11.9% to £4.53.

Since January 2009 the price of a three-course pub meal has risen 6% from £14.85 to £15.74, a restaurant meal is up 5.1% from £19.48 to £20.47, while the average cost of a hotel meal has risen 6.6% over the past 12 months, from £26.45 to £28.20.

The research also reveals operators are using a variety of ‘meal deal’ offers, familiar retail brands, health claims and details of food provenance to keep the public eating out.

A separate survey by YouGov found that almost half of Londoners (46%) eat out at a restaurant or get a take-away at least once a week and this figure rises to 76% for 18-24 year olds. Nearly two-thirds of respondents use a discount voucher to get money off their meal and almost three-quarters (73%) of 18-24 year olds use the voucher schemes.

New research from foodservice analyst Horizons, which analyses menus from 100 high street foodservice brands, reveals deals such as ‘Italian car owners eat for free on Thursdays’ at Revolution, ‘curry & pint night for £4.99’ at Hungry Horse, and ‘all you can eat’ for £7.75 at Whitbread’s Table Table.

Some offers encourage diners to trade up to bigger portions such as Marston’s ‘go large for £1’ on its carvery, ‘go large on your chips for 35p’ at Beefeater, ‘add an extra egg’ on gammon & chips at Punch Taverns, ‘add a dessert for £2’ at Pizza Hut or ‘upgrade to an 8oz steak for £1’ at Miller & Carter.

The research shows that retail brands are becoming more commonplace on menus, particularly in pubs, as operators seek to sell familiar products that give consumers quality assurance. Examples include Heinz Baked Beans (Little Chef), Ben & Jerry’s (Gourmet Burger Kitchen), Häagen-Dazs (Gusto), Yeo Valley Organic Yogurt (Premier Inn) and Mövenpick ice cream (Exchange Bar & Grill).

Operators are also making more use of provenance-related labelling such as ‘rope-grown British mussels’ and ‘organic Shetland salmon’, while terms such as ‘farm assured’, ‘line-caught’ and ‘locally grown’ as well as health-related claims such as ‘nutritional balance’, and ‘5-a-day’ are becoming more common. Chef & Brewer’s menu, for example, has a ‘superfood salad’ dressed with pumpkin seeds and beetroot or pomegranate dressing. The Orchid pub company offers a roasted half of chicken with chips and a superfood salad, while Giraffe’s menu has an ‘ultimate superfood rude health muesli’, a wheat-free, organic blend of oats, rye, quinoa and barley flakes with chopped dried fruits and wild berries.

Exotic-sounding dishes are appearing more frequently on menus too, as chains attempt to offer customers something new. Pub chain Varsity, for example, has a dish called  ‘dirty dog’s dinner’ (served in a dog bowl!) and vodka chilli cherry tomato pasta, Blubeckers sells chips with Bloody Mary Ketchup, Scream has Quorn and Chianti lasagne while Las Iguanas has brie and papaya quesadilla.

The research also reveals something of a return to nostalgia, with a growing number of dishes being described as slow-cooked or roasted. Porridge has also made a comeback. Frankie & Benny’s, Little Chef, Eat, Starbucks and Browns are all selling porridge while Pret A Manger sells pots of porridge plain, with honey or with compote. Prices range from 99p to £3.50. “Porridge has made a remarkable reappearance over the past year, it has really gained in popularity. But it’s the perfect breakfast option – cheap to make, nutritious, healthy and filling,” comments Horizons’ managing director Peter Backman.

Mini desserts are another new high street trend, giving diners a taste of several desserts or enabling them to share. Ha Ha Bar & Grill, for example, has a trio of mini desserts with a mini lemon tart, chocolate fondant and a shot of blackcurrant and lemon mousse for £5.95. Likewise, Greene King-owned Hardy’s House offers a ‘mini hot pudding trio’ including chocolate and orange, zesty lemon and treacle sponge pudding costing £3.49.