Consumer foodservice spend returns to pre-COVID levels across Europe – but customer visits have yet to recover fully

Circana CREST service analysis reveals a positive outlook for the remainder of 2023

BRACKNELL, UK – July 5, 2023 – Circana, the leading advisor on consumer complexity that formerly traded as IRI and The NPD Group, today launched its latest results from its CREST service analysis, revealing continued recovery for the European foodservice sector as consumers across five markets return to bars, restaurants and other foodservice establishments. Total spend for the sector is now back to pre-pandemic levels (€308 Bn in 12 months ending May 2023). 

Spain is the first country to show spend growth to pre-pandemic levels (8%) for the year ending May 2023 compared with 2019. It is closely followed by Italy with 3% growth and Great Britain, down a nominal 1%. Germany lags slightly, down 2%, whilst France, with restrictions still in place in early 2023, is down 6%.

Whilst consumer spend has recovered to almost pre-pandemic levels in most countries, the data revealed that the sector is still seeing a long-tail COVID-19 impact, with 1 in 4 European consumers (24%) saying they still consider restaurants a risk for infection. This reduces when they can eat outside. Because of this, changes to consumer’s lives, such as incremental work-from-home and the continued cost of living crisis, the number of consumer visits still lags pre-pandemic levels by 11%.

The impact is more varied by channel. For the first time since COVID-19 hit, consumer spend in quick service restaurants (QSR) rose above pre-COVID-19 levels in June 2022 to 8% at the end of May 2023. Full Service Restaurants (FSR) continue to recover whilst workplace and student canteens remain in double-digit losses, with new working habits continuing to impact the sector even while many people are back in offices for at least some of the time. 

Jochen Pinsker, the Senior Vice President of European Foodservice at Circana who has tracked foodservice and consumer behaviour trends for more than 20 years, commented: “Many in the industry can view the spend in foodservice as a sign of recovery, but this is mainly being driven by inflation and masks the fact that consumers are making fewer visits. There is, however, large potential to bring many consumers back into restaurants, especially as the outdoor season begins.” 

For consumers that are eating out, Circana revealed that growing average eater checks have helped get money into cash registers (an increase of 11% from May 2019 to 2023). Whilst people claim high price sensitivity, their actual behaviour hasn’t significantly changed: Price as a reason for choice has yet to grow, while satisfaction with value for money (65%) and re-visit intentions (60%) remain high.

Pinsker continued: “That said, confidence remains low as factors like inflation and economic uncertainty are concerning to consumers, which is why we are seeing small changes to reduce costs where possible – including using price promotions, cutting down on add-on items and switching to lower price channels.”

Circana identified three key areas for growth:

1. The need to socialise continues to motivate people to eat out (35% in May 2023). The data revealed an opportunity for growth in afternoon visits – which has risen from 18% in 2019 to 21% post-COVID. In fact, the importance of socialising and treat visits is growing at the expense of convenience-driven purchases.

Pinsker recommended: “Create an atmosphere and ambience that encourages consumers to spend more time in. Look at extending opening hours and creating sharing products.”

• High demand for healthy and sustainable food, especially after the pandemic. 50% of consumers said they were more likely to order healthy food at restaurants than before the pandemic (2019 compared with 2022). Furthermore, 53% of consumers now prefer restaurants that are focused on sustainability (reducing waste and plastic use).

Pinsker added: “Whilst healthy and sustainable choices are important, our data showed that product quality and choice are the most important drivers for consumer decisions when deciding where to go. This is closely followed by location/atmosphere. Promotions were cited as a reason for choice by just 5% of consumers.” 

• Consumers love to order digitally. Whether for delivery, to pick up, or even in a kiosk restaurant, spending has reached €31 Bn – in May 2023.Click&Collect is now the fastest growing service – growth was on the increase pre-pandemic, skyrocketed during that period and is still experiencing further gains – ten percent growth on 2022 figures to reach €10 Bn in 2023.

Pinsker commented: “Click&Collect has proved popular during and post pandemic with consumers. Being able to waive payment processes, ordering at their own speed and enjoying loyalty programmes has paid off. Restaurants are, however still struggling to make delivery options work for them.”

Notes to editors: CREST panel data captures consumer information collected from Circana’s online consumer panel in five European countries (France, Germany, Italy, Spain, and Great Britain) about commercially prepared meals, snacks and beverages, and provides a detailed understanding about where consumers are eating, what they eat and how much they are spending. The data covers 2023 year to date (end of May).