A report from Bord Bia has found that the Irish food service market (or out of home industry) for 2020 is estimated to be €4.5 billion, representing a drop of 47 per cent against 2019 figures.
After eight years of consecutive growth, the report shows that the industry is expected to lose over €4 billion in consumer spending in 2020. The main factor in this is the impact of the Covid-19 pandemic.
However, it predicts that even in a worst-case scenario, there will be some bounce back in terms of market recovery in 2021.
Acknowledging the hugely challenging environment that the industry has faced over the past seven months and the ongoing uncertainties as we head into 2021, the report looks to forecast what the future will hold for all involved in food service in Ireland.
It also outlines key trends that food service operators and food suppliers should consider in order to ensure that their businesses remain relevant.
Maureen Gahan of Bord Bia said:“The performance of the food service industry is intrinsically linked to economic conditions, tourism and employment – all of which will continue to be challenged in 2021. The changing landscape will have a long-term impact on revenue and profitability - everything from the drive from consumers for keener value pricing, to the shift away from city centre and high street locations to the challenge of recruiting and training new staff."
bounce back
"We are predicting a bounce back in 2021 and have outlined three different scenarios within our report as to how this might play out. In a best-case scenario, the market could see an uplift of as much as 41 per cent, however in a worst-case situation, we’re suggesting that growth on 2020 figures will be circa 16%. In order to prepare for market improvements, we have outlined a number of considerations for food service providers and food producers in order to best position their business for recovery and growth.”
The recommendations in the report include the following:
- New Restaurant Layouts - As part of a shift in how food service operators can make money, a significant driver will be changes in the operational footprint/layout of restaurants across all sectors. Flexible indoor seating, additional outdoor seating and modular kitchens are just some of the corresponding front and back of house impacts.
- Off-Premise Acceleration – The pandemic has shown that having alternatives and contingencies available to shift to off-premise for all will be critical to future success. 2021 will see continued growth in Take-away, Click n Collect, Drive Thru and Home Delivery.
- Reinvention of the Business Model - The restaurant and broader foodservice industry will need to re-look at the business model and may need to re-invent parts of the business. This will include everything from delivery-only kitchens to restaurants selling grocery items, to a growth in meal delivery kits.
