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United Kingdom Foodservice Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)

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  • 80 Pages
  • June 2022
  • Region: United Kingdom
  • Mordor Intelligence
  • ID: 4622435
The UK Foodservice Market is projected to register a CAGR of 3.02% during the forecast period (2022-2022).

There has been a definite impact of the coronavirus outbreak on the overall foodservice business, with various segments affected in varying degrees in the United Kingdom. The COVID-19 pandemic placed unprecedented stress on food supply chains, with bottlenecks in farm labor, processing, transport, logistics, as well as momentous shifts in demand. Lockdown resulted in the closure of all pubs, cafes, and restaurants in the country. During this time, the entire industry came to a complete halt; however, some restaurants remained open for delivery and takeaway. To address the lockdown hit to the industry, the UK government implemented an initiative to help the restaurant industry, the Eat Out to Help Out scheme, in August 2020, following the first COVID-19 lockdown. During August 2020, diners in participating restaurants received a 50% discount on food items, up to GBP 10, purchased in restaurants, pubs, and cafes. Such factors are likely to change the market scenario in the coming years.

In the United Kingdom, chain outlets are very famous in the channel, acquiring the highest portion in the foodservice market. Standalone establishments are most common and well-liked by consumers. Digital platforms play a vital role in driving everyday sales of fast serving restaurants, reducing the delivery time, and providing contactless food service for consumers. The foodservice operators are benefiting from a dynamic and expanding corporate sector in areas like full-service dining, among other sectors.

The increasing frequency of restaurants offering various ethnic foods, such as Asian, American, Chinese, Japanese, and Thai cuisines, is the major factor driving the market in independent outlets among consumers. The increasing number of quick-service restaurants such as KFC, McDonald’s, Pizza Hut, and Domino’s captured maximum attention from consumers who were looking for convenience in their everyday meal requirements.​

Key Market Trends

Cafes and Bars Hold a Significant Share in the Market

The country’s strong café culture has resulted in an increasing number of cafe and bar establishments every year. The utilization of QR codes became more popular in conventional cafes, restaurants, and the pub market. More than 84% of UK citizens have utilized the QR code to payment mode for paying for a meal, constituting their existence as a staple in restaurant payment alternatives. The increasing number of cafes and bars includes a blend of non-specialists, independents, and major chains, such as Starbucks, Costa Coffee, and Caffe Nero, thus meeting the consumers’ demand for different coffee blends.​ About 39% of UK consumers claim that their coffee consumption has increased over the past couple of years, with 18% visiting cafes at least once a day. The country’s strong coffee culture has contributed significantly to the growth of coffee shops/cafes. ​Supermarket store's grab-and-go stayed as the largest food supply sub-channel till the pandemic phase, but its presence in market growth is expected to fall due to the rising pressure to compete with steadfast food-to-go experts.

Growing Demand for Multicuisine or Ethnic Cuisines

The demand for multi- or ethnic cuisines in European countries, including the United Kingdom, is increasing as more consumers, especially millennials and baby boomers, are willing to experiment with new and global cuisines. The consumption of healthy and nutritious food is rising, along with the increasing capital investment in making healthy and traditional food, boosting the foodservice market in the United Kingdom. The manufacturers of ethnic food are concentrating more on food quality, convenience factors, different types of cuisine, and food packaging. Moreover, the high rate of immigration, tourist population, and increasing sporting events have supported the ethnic food demand. To cater to the personalized taste of consumers, cuisine-specific caterers or restaurants are setting up their kiosks in villages, stadiums, and near venues where sporting events are held to increase their popularity. Some of the most popular ethnic cuisines consumed include Japanese, Chinese, Mexican, Italian, Greek, French, Thai, Spanish, and Indian, which are increasingly served to consumers via hotels, restaurants, food halls, fast-food holdings, etc.

Competitive Landscape

The UK foodservice market is highly competitive, owing to the number of small and giant players dominating the market. In the United Kingdom, cafés, mobile food services, and restaurant services are projected to be the largest sectors in this industry, with more than 89,130 businesses. Due to the diversified product portfolio, the food processing companies are competing with each other in terms of offering ethnic and multicuisine foods at affordable prices on consumer demand. Some of the key players in the market include McDonald’s, Starbucks Coffee Company, Domino's, Whitbread PLC, and Yum! Brands. Major players are embarking on market expansions and innovations in terms of online delivery to achieve consolidation while optimizing their offerings and increasing their market shares.

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Table of Contents

1.1 Study Assumptions and Market Definition
1.2 Scope of the Study
3.1 Market Overview
4.1 Market Drivers
4.2 Market Restraints
4.3 Porter's Five Forces Analysis
4.3.1 Threat of New Entrants
4.3.2 Bargaining Power of Buyers/Consumers
4.3.3 Bargaining Power of Suppliers
4.3.4 Threat of Substitute Products
4.3.5 Intensity of Competitive Rivalry
5.1 By Type
5.1.1 Full-service Restaurants
5.1.2 Quick-service Restaurants
5.1.3 Street Stalls and Kiosks
5.1.4 Cafes and Bars
5.1.5 100% Home Delivery Restaurants
5.2 By Structure
5.2.1 Independent Consumer Foodservice
5.2.2 Chained Consumer Foodservice
6.1 Most Active Companies
6.2 Most Adopted Strategies
6.3 Market Share Analysis
6.4 Company Profiles
6.4.1 Yum! Brands Inc.
6.4.2 Starbucks Corporation
6.4.3 McDonald's Corporation
6.4.4 Domino's Pizza Inc.
6.4.5 Burger King Corporation
6.4.6 Mitchells & Butlers
6.4.7 Whitbread PLC
6.4.8 PizzaExpress (Restaurants) Limited
6.4.9 Nando's Group
6.4.10 The Restaurant Group PLC

Companies Mentioned

A selection of companies mentioned in this report includes:

  • Yum! Brands Inc.
  • Starbucks Corporation
  • McDonald's Corporation
  • Domino's Pizza Inc.
  • Burger King Corporation
  • Mitchells & Butlers
  • Whitbread PLC
  • PizzaExpress (Restaurants) Limited
  • Nando's Group
  • The Restaurant Group PLC