The food-to-go (FTG) market is predicted to be worth £23.4bn by 2027 – 26% more than 2019 pre-pandemic levels, according to the latest channel forecast from IGD.
Its annual food-to-go forecast report examined the outlook by sector for QSR, coffee shops, food-to-go specialists, supermarkets, convenience, forecourts, and other retailers.
It found that by the end of 2022, the food-to-go segment will be worth £18.9bn, 3% more than its value in 2019 with inflation identified as the main driver for growth over the next 18 months.
But the insights provider expected performance to slow by the end of the year and throughout 2023 as consumers face rising energy, fuel, and food costs.
“Inflation is already affecting many consumers, but until now, food-to-go has continued to perform strongly,” Nicola Knight, senior analyst for food-to-go and author of the forecast at IGD, said.
“This will change as the true impact of rising prices really kicks in in the last quarter and takes hold next year. So, while inflation will boost the overall value of the market, volume will, at best, stay the same in 2023.
“The next 18 months will be a challenging period for the sector, mainly for coffee and food-to-go specialists, as operators attempt to balance rising costs with helping consumers to save money.”
With a consumer focus back on value, the report suggested the price point, range and execution of meal deals would become fiercely competitive but said retailers were in a strong position.
“If they can get their price, offer and format right, by 2027, retail could more than regain the share lost to foodservice operators during the pandemic to claim 23.7% of the food-to-go market, compared with 22.9% in 2019 and 20% in 2020/21,” Knight added.
“Key opportunities for retailers over the next 18 months will include strengthening their meal deal offers as consumers become more value-led, and utilising customer data to create tailored offers that are relevant and savings-focused. There’s also an opportunity for them to increase food-to-go ranges to meet consumer needs across a wider variety of meal occasions.”