KANSAS CITY — Just a few years ago, away-from-home food sales equaled and, at times, surpassed what consumers spent for food at home. However, the pandemic changed that, and it looks like foodservice establishments are facing more challenges in this current economic environment.
A recent study by Information Resources, Inc. and The NPD Group pointed out that eating out typically costs 3.4 times more than in-home food purchased at retailers. To counter rising food prices, consumers are cutting back on restaurant visits and seeking for bargains at supermarkets.
The research noted the nearly $1.5 trillion at- and away-from-home food market is forecasted to grow around 8% in 2022. At-home food sales are expected to expand 8.7% versus a year ago outpacing away-from-home sales, which are predicted to rise 6% over last year. The study also noted that up to 20 million Americans work from home.
As a result, a whopping 62.5% of dollars spent on food come from retail at-home sales with the remainder from foodservice. Moreover, the study said foodservice traffic has decelerated, slipping 3% in July. That information is consistent with other studies showing foodservice sales growth slowing earlier this year.
When dining out, consumers also are trading down, which explains why fast-food chain sales remain strong while other segments of the foodservice industry struggle. Keep in mind there’s no single consumer. The study indicates higher income households prefer premium products and are driving growth while lower income consumers seek mainstream or value products. The researchers predict restaurant recovery will be slow but steady in 2023 as traffic strives to return to pre-pandemic levels.