The UK food-to-go market is predicted to decline in value by almost half over the next three years due to the impact of the coronavirus pandemic according to IGD.
New research formed in consultation with the industry forecasts that the sector will decline by to £10.8 billion in 2020 – a decrease of £8.1 billion in 2019.
However, a degree of bounce-back is anticipated in 2021 with high levels of year-on year growth off a low base.
Despite continued high growth rates – the market in 2022 is expected to only return to 88% of 2019 levels, valued at £16.7 billion.
Nicola Knight, senior food-to-go analyst at IGD, said: “Unsurprisingly, since the UK went into lockdown, almost all food-to-go shopping trips experienced significant declines.
“Where previous forecasts saw the sector growing at twice the rate of grocery retail, 2020 has seen a rapid change in consumer behaviours and daily routines that could have long term implications.
“Footfall in cities and transport hubs – on which many food-to-go businesses depend – has so far been slow to return. The shift to more homeworking in particular has had massive implications for food-to-go.
“Specialist operators with sites prevalent in affected locations are already adapting strategies to offset this long-term change in consumer behaviour.
“The return will be gradual and may be subject to reversal; trends may differ by geographic area subject to local lock-downs.”
IGD’s medium-long term predictions for food-to-go include specialists in within the sector being most affected with many being located in city centres and transport hubs.
While some smaller players and new entrants may grow by moving into vacant store units, economic conditions will mean many empty sites are not filled for some time.
QSR is anticipated to be the most resilient as it offers a value option for financially stretched consumers, growing its share by 4.6 percentage points between 2019 and 2022.
Drive thru and delivery offers have also enabled the sector to adapt to local lockdown restrictions.
Convenience stores in particular have and will continue to benefit from their local presence.
Retail channels will grow market share, mainly during 2020 as food-to-go specialists and coffee shops are impacted by declines in commuter footfall.
Addressing how retailers and suppliers can navigate current and future challenges, Nicola Knight said: “Changes in consumer behaviours throughout this period offer up opportunities but food-to-go businesses need to be quick to grab them. Never has it been more important to know your customers, understand them and engage with them.
“Picnic sets for outdoor socialising, lunch boxes for home workers and meals to be heated at home are all examples of rapid deployment of new ranges adapted to current consumer needs.
“Responding this quickly requires staying close to customers, building strong partnerships with suppliers and an internal structure designed for fast decision-making.
“Engaging with customers in this way should also help retailers to understand where the demand has moved to if city centres and transport hubs continue to lose footfall.
“Delivery should also continue to form a part of retailer and operator strategies, particularly if local lockdowns progress.”
For more insights into the food-to-go market, visit IGD Retail Analysis.
Rural Affairs Secretary Mairi Gougeon 
Andrew Goodacre
Andrew Goodacre
