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Morning Briefing for pub, restaurant and food wervice operators

Wed 19th Jun 2019 - Bakeries sees strongest on-premise growth thanks to sharper food-to-go focus
Bakeries sees strongest on-premise growth thanks to sharper food-to-go focus: Bakery outlets have seen the strongest growth in on-premise sales and visits among British quick service restaurant (QSR) channels – up more than 19% and almost 18% respectively in the past year – thanks to sharper food-to-go focus. The research by insights firm The NPD Group showed bakery outlets boosted total sales by 6% in the year ending April 2019 and increased visits by 2.2%, outperforming pizza and chicken outlets, which saw visits drop. The findings also revealed a 19% jump in the number of coffees served at bakeries to 1.17 billion – the best in Britain’s QSR market. The NPD Group said Britain’s bakery chains and independents are in a strong position to increase their off-premise business and challenge sandwich retailers, supermarkets and QSRs for a larger share of the food to go, click and collect, and delivery channels. Bakery outlets are already a popular option for food-to-go customers, with 80% of bakery purchases consumed on the move. But with bakeries only accounting for £1.2bn (5%) of Britain’s £22.5bn food-to-go business annually, up from £1bn five years ago, The NPD Group said there was clearly room for growth. Bakeries also account for only 3% of total click-and-collect transactions but sales are already increasing from this low base. While delivery business for bakeries also remains at a low level, delivery volume is up almost 63% in the past year and the value of delivery sales has increased more than 47%. Bakeries also saw a 10% increase in snack sales in the past year, the strongest total sales growth in any QSR segment. About 1.46 billion visits to bakeries involved a deal or promotion, up 16% on the past year. Bakeries are also appealing across the generations. In the past year, bakeries have achieved 15% growth in visits from 16 to 24-year-olds and 5% from over-50s. Bakeries were the fastest growing segment among over-50s and second fastest for 16 to 24-year-olds. Peter Linden, insight manager foodservice UK at The NPD Group, said: “Bakeries and patisseries are an important part of Britain’s £57bn out of home (OOH) or eat-out foodservice industry. Many businesses are moving away from their traditional bakery offering to a sharper food-to-go focus. This involves putting on good coffee, offering new food choices, and meeting the demand for click and collect and delivery. Bakeries by their nature focus on food to go and this is where the growth is, with sales in this part of Britain’s total OOH market having grown 8% in the year to April 2019. Bakeries can secure more growth by increasing their share of the food-to-go market from their current level of just 5% and bringing their food-to-go appeal to dayparts they don’t normally service, such as dinner. They also have scope to provide delivery, especially at breakfast and weekends. Bakery chains are ideally suited to riding some of the big trends in British foodservice and have responded imaginatively to consumer demand for convenience.”

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