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Morning Briefing for pub, restaurant and food wervice operators

Thu 19th Apr 2018 - Takeaway delivery expected to be worth £5bn in two years as market soars
Takeaway delivery expected to be worth £5bn in two years as market soars: The delivery phenomenon is continuing to shake up Britain’s takeaway foodservice industry, growing 73% in the past decade to £4.2bn as of February 2018, according to insights firm The NPD Group. The aggregators – such as Deliveroo, Just Eat, Hungryhouse and UberEats – have been the catalyst for this growth. They have levelled the playing field, allowing smaller independents to compete more effectively with the bigger foodservice chains, The NPD Group said. It believed takeaway delivery would grow a further 17% in value over the next two years and could be worth as much as £5bn by then. The UK’s favourite foods for delivery in 2017, according to The NPD Group, were Chinese (179 million servings), pizza (171 million servings), burgers (82 million servings) and curry (70 million servings). Cyril Lavenant, The NPD Group head of foodservice UK, said: “Delivery is a big hit with consumers – thanks to the aggregators they now have a very large choice of restaurants at their fingertips. It is also a great marketing platform, especially for independent restaurants that can’t afford to spend on advertising. Phone apps and websites also make it easier for consumers to order full meals from a variety of cuisines. Just one aggregator could offer a choice between burgers, chicken, Indian or Chinese, and much more. It’s all there at the click of a button.”

The findings also showed:

Delivery orders up: Orders grew by 20% in visits in the two years to February 2018 – that’s 20 times faster than for the overall foodservice industry.

Ten takeaway deliveries per person: In the year ending February 2018, there were 673 million deliveries, nearly 6.0% of the total British eat-out or out-of-home market. This is equivalent to everybody in Britain ordering ten pizza takeaway deliveries each year.

46% of delivery is still by phone: Although online is catching up, with 38% of orders, apps make up the remaining 16%. The NPD Group said it expected app orders to race ahead – in two years they have increased three-fold.

Pizza is not so hot: While pizza delivery is in second place, it is not growing as quickly as the takeaway delivery market. Pizza’s share has dropped three percentage points in 2017 versus 2016.

Burgers are still sizzling: But British consumers love burgers knocking on their front door. Burgers are among the delivery winners, accounting for 60% more deliveries in 2017 than 2016.

Chips with everything: Chips are making their way into many a delivery box as they are now present in nearly 16% of all delivery visits.

Lavenant added: “Larger foodservice operators are responding well to the takeaway delivery boom but know they need to manage the demand very carefully. With consumers spending about half as much as when they visit a restaurant in person – people typically cut out starters, desserts and drinks – a delivery order is potentially less lucrative to a large foodservice business and can reduce an operator’s profitability. Restaurants also must pay commission to the delivery company, and this impacts profits too. Whatever way you look at it, takeaway delivery is definitely changing the shape of Britain’s foodservice industry.”

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