Circana Predicts Moderate Growth for Spanish Foodservice Sector, With Some Disruption as Food Retail Inflation Eases

Barcelona, Spain – 8 June 2023 – According to the latest CREST panel insight on Europe’s foodservice sector from Circana (formerly IRI and The NPD Group), consumers spent just over €13bn in the year ending 30 April 2023 on foodservice in establishments, such as bars, restaurants and other channels. This was 20% more than in the previous year, to the end of April 2022. 

However, despite faster recovery of foodservice in Spain than other European markets in the last year, Circana advises Spanish bars and restaurants to be prepared for slower growth and further disruption in the second half of the year as inflation in food retail eases, widening the price difference between eating out or eating at home.  

“Inflation in the price paid by Spaniards for foodservice (7.6%) has been lower than for food retail (which is more than 15%),” said Edurne Uranga, head of Circana’s foodservice business in Europe. “This is partly because restaurants and bars softened the full impact of inflation for diners by reducing their own profit margins.  This narrowed the price gap between dining out and cooking food at home, making it easier for people to justify the increased cost of eating out, while also satisfying their desires to cook less and socialise with friends and family more.

“However, as food retail inflation eases (it dropped from just under 13% in April from highs of nearly 17% in February and March), the price gap will widen. As a result, the cost of dining-out could become a discretionary cost. The foodservice industry will need to work hard to manage consumers’ perceptions about future price increases and justify the value of their dining experience.”

A large majority (83%) of Spanish consumers think their personal financial situation will be at least the same as today (or even better) during the next six months. This is a positive signal for the sector. Even with food retail inflation easing, Circana predicts moderate growth for this Summer on foodservice visits and spend compared to last year. Spending will grow between 3 and 6%. This compares to nearly 30% growth last summer, which can be attributed to pandemic recovery as consumers eagerly returned to restaurants and bars for the first summer without restrictions. “Understanding what people want when they dine-out will help restaurants cater to the adapted needs of consumers,” said Uranga. 

Circana’s latest European Sentiment Survey highlights the increasingly innovative and non-conformist demands of consumers. For example, growing preference for vegan, vegetarian, and low fat and low sugar meals means that more than one-third of Spanish consumers (36%) now say they prefer restaurants that can satisfy the needs of everyone in their group with broader menu options. This is 25% for Europe. Spanish consumers are also more likely than Europeans (20% more people) to prefer restaurants that provide memorable experiences, with great food, music, and the general ambience. 

Other highlights from Circana’s analysis include: 

• Takeaway and delivery of ready prepared food from bars and restaurants to eat in the home continued to outpace pre-pandemic levels. However, the “eat at home” part of this channel is a smaller slice of total foodservice spending (13%) compared to Europe overall (17%), cementing Spain’s position as a nation of dine-outers. 
• The overall market for takeaway and delivery, including food on the go and consumption in the workplace, accounted for 32% of foodservice spend in the last year, some €12.6bn.   
• €3.6bn spent in bars and restaurants during April, the highest monthly spend in the last year, highlighting the determination of Spaniards to socialise with friends and family even while food retail inflation shows signs of easing.  
• Tapas bars show particularly strong growth and now capture 13.9% of foodservice market share (by number of visits, some €403 million spent). 
• Spanish consumers continue to find ways to mitigate impact of inflation on the cost of their final bill through ordering fewer starters, desserts and/or drinks and ordering the less expensive dishes. They are also trading down from casual dining to limited-service restaurants for example. 

About CREST
CREST is Circana’s flagship information service for the foodservice industry. It captures consumer information collected from an online consumer panel in five European countries (France, Germany, Italy, Spain, and the UK) about commercially prepared meals and snacks bought from bars, restaurants, commercial catering and other minor channels such as vending, convenience stores or company canteens, to provide detailed understanding about where consumers eat, what they eat and how much they spend.