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Competitive Shift: Retail into Foodservice - US - May 2015

“Food retailers have gained traction in the freshly prepared meals category by providing foods that are of high quality, healthy, and competitively priced. Further, they have renovated stores and spaces to highlight their offerings, making these products easy for consumers to find and purchase. Foodservice operators need to focus on promoting their healthy offerings, snack foods. and convenience, in order to compete. Working on efficiencies to cut down on wait times and offering a wide variety of menu items also will help appeal to busy consumers looking to save money and time by purchasing ready-made foods.”
– Julia Gallo-Torres, Sr. Foodservice Analyst

This report answers the following key questions:

  • What can restaurants do to capture more of the snacking business? 
  • How to spur purchase of beverages in foodservice?
  • What can foodservice do to be seen as more convenient than retail?

This report will explore consumer attitudes and behaviors with respect to freshly prepared foods that are ready to go, in retail. These products include foods such as entrees, side dishes, soups, salads, appetizers and other dishes that compete directly against restaurant foods; this does not include frozen foods. The report will explore consumer motivations, attitudes, and reasons for purchase. It will show during which dayparts consumers purchase these freshly prepared foods both at retail, and at restaurants (for comparison), and how influences such as convenience, quality, health and food experience come into play.

Retail food stores have improved their freshly prepared, made-to-order foods and have become strong competitors to restaurants. As consumers are still concerned about spending, one way they can enjoy restaurant-quality foods is at retail food stores, which are offering high-quality, freshly made foods that are easy to grab and go. Further, as grocery stores become more sophisticated in their endeavors, in-store restaurants and foods will continue to eat away at foodservice market share.

Consumers are turning to food retailers to help with meal solutions, and these retailers have responded with improved offerings to include foods that are fresh, healthy and available at different price points. This is most evident during the snacking daypart, where consumers overwhelmingly choose retail foods over restaurant foods because of health, price, and convenience.

However, in many cases, consumers prefer to purchase their foods from restaurants, because those foods are deemed to be more exciting, trendy, and indulgent than what’s available in grocery stores. But, consumers are also concerned with health, especially when it comes to feeding their families. This presents an opportunity for foodservice operators, who have spent much time and effort revamping menus to provide healthier foods at competitive prices, to message on these points, so that they can appeal to any mindset of the busy foodservice consumer.

 

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Table of contents

  1. Scope and Themes

    • What you need to know
      • Definition
        • Data sources
          • Consumer survey data
            • Consumer qualitative research
              • Abbreviations and terms
                • Abbreviations
                  • Terms
                  • Executive Summary

                      • Market drivers
                        • Figure 1: Retail sales of foodservice and drinking places versus Grocery stores, January 1992-February 2015
                        • Figure 2: Median household income of families with children, in inflation-adjusted dollars, 2003-13
                      • Competitive context
                        • Figure 3: Consumer attitudes/opinions about food, November 2008-December 2014
                      • The consumer
                        • Figure 4: Restaurant types/daypart of consumer purchases, February 2015
                        • Figure 5: Reasons to purchase at retail, February 2015
                        • Figure 6: Types of food purchased, restaurants versus retail, February 2015
                        • Figure 7: Restaurants/daypart where consumers purchase – Any restaurant purchase, by social media, February 2015
                      • What we think
                      • Issues and Insights

                          • What can restaurants do to capture more of the snacking business?
                            • The issues
                              • The implications
                                • How to spur purchase of beverages in foodservice?
                                  • The issues
                                    • The implications
                                      • What can foodservice do to be seen as more convenient than retail?
                                        • The issues
                                          • The implications
                                          • Trend Application

                                              • Trend: FSTR HYPR
                                                • Trend: Nouveau Poor
                                                  • Trend: Many Mes
                                                  • Market Drivers

                                                    • Key points
                                                      • Foodservice sales surpassed grocery store sales in March 2015
                                                        • Figure 8: Retail sales of foodservice and drinking places versus Grocery stores, January 1992-February 2015
                                                      • Supermarkets and mass merchandisers are expanding fresh food offerings
                                                        • Disposable income continues to rise in 2015, though slowly
                                                          • Figure 9: Real disposable personal income, January 2007-January 2015
                                                        • The good news is that economics are improving for families with children
                                                          • Figure 10: Median household income of families with children, in inflation-adjusted dollars, 2003-13
                                                        • Unemployment dropping slowly; consumers spend with caution
                                                          • Figure 11: Unemployment rate and underemployment, January 2007-February 2015
                                                        • Weight continues to be an issue for many Americans
                                                          • Figure 12: Prevalence of obesity among adults aged 20 and over, 2011-12
                                                        • Consumers trying to increase their fruit and vegetable intake
                                                          • Figure 13: Per capita availability of fruits and vegetables (fresh, and total), 1970-2012
                                                      • Competitive Context

                                                        • Key points
                                                          • Consumers enjoy cooking at home
                                                            • Figure 14: Consumer attitudes/opinions about food, November 2008-December 2014
                                                          • C-stores widen their made-to-order menu options
                                                            • Figure 15: Made-to-order and fresh food purchases in convenience stores, December 2014
                                                          • Consumers seek frozen and shelf-stable, restaurant-quality foods at retail
                                                          • Marketing Strategies

                                                            • Key points
                                                              • Convenience trumps health
                                                                • Consumers seek restaurant-quality foods in retail food experience
                                                                  • HEB Grocery
                                                                    • Mariano’s Fresh Market
                                                                      • Standard Food Market
                                                                        • Whole Foods Market
                                                                          • Kings Food Markets
                                                                            • Sprouts Farmers Market
                                                                              • Schnuck Markets
                                                                              • Correspondence Analysis

                                                                                  • Full-service restaurants deliver on variety and indulgence
                                                                                    • Figure 16: Correspondence analysis – Descriptors consumers associate with restaurants versus retail, February 2015
                                                                                    • Figure 17: Descriptors consumers associate with restaurants versus retail, February 2015
                                                                                  • Retail products win on health and diet
                                                                                  • Consumer Data – Overview

                                                                                    • Key points
                                                                                      • Consumers seek convenience, within their budgets
                                                                                          • Figure 18: Reasons to purchase at retail, February 2015
                                                                                          • Figure 19: Reasons to purchase at restaurants, February 2015
                                                                                        • Consumers prefer using FSRs for dinner; snack at retail more than foodservice
                                                                                            • Figure 20: Retail stores/daypart where consumers purchase, February 2015
                                                                                            • Figure 21: Restaurant types/daypart of consumer purchases, February 2015
                                                                                            • Figure 22: Daypart where consumers purchase, retail versus foodservice, by nets – February 2015
                                                                                          • Consumers prefer burgers and pizza at restaurants, and social media users order more
                                                                                              • Figure 23: Types of food purchased, restaurants versus retail, February 2015
                                                                                              • Figure 24: Types of food purchased, restaurants versus retail, February 2015
                                                                                              • Figure 25: Restaurants/daypart where consumers purchase – Any restaurant purchase, by social media, February 2015
                                                                                              • Figure 26: Retail stores/daypart where consumers purchase, by social media, February 2015
                                                                                          • Consumer Data – By Gender and Age

                                                                                            • Key points
                                                                                              • Those 55+ like a unique dining experience, while younger men value convenience
                                                                                                  • Figure 27: Attitudes toward food purchases, restaurants versus retail, by gender and age, February 2015
                                                                                                  • Figure 28: Attitudes toward food purchases, restaurants versus retail, by gender and age, February 2015
                                                                                                  • Figure 29: Attitudes toward food purchases, restaurants versus retail, by gender and age, February 2015
                                                                                                • Males aged 18-34 most likely to purchase at both restaurant and retail
                                                                                                    • Figure 30: Restaurants/daypart where consumers purchase – Any restaurant purchase, by gender and age, February 2015
                                                                                                    • Figure 31: Daypart where consumers purchase – Any retail purchase, by gender and age, February 2015
                                                                                                  • Consumers most definitely like restaurant pizza, hamburgers, and chicken
                                                                                                      • Figure 32: Types of food purchased, restaurants versus retail, by gender and age, February 2015
                                                                                                      • Figure 33: Types of food purchased, restaurants versus retail, by gender and age, February 2015 (continued)
                                                                                                      • Figure 34: Types of food purchased, restaurants versus retail, by gender and age, February 2015
                                                                                                      • Figure 35: Types of food purchased, restaurants versus retail, by gender and age, February 2015 (continued)
                                                                                                    • Consumers save money with retail beverages, enjoy restaurant seafood
                                                                                                        • Figure 36: Types of food purchased, restaurants versus retail, by gender and age, February 2015
                                                                                                        • Figure 37: Types of food purchased, restaurants versus retail, by gender and age, February 2015
                                                                                                        • Figure 38: Types of food purchased, restaurants versus retail, by gender and age, February 2015 (continued)
                                                                                                        • Figure 39: Types of food purchased, restaurants versus retail, by gender and age, February 2015
                                                                                                        • Figure 40: Types of food purchased, restaurants versus retail, by gender and age, February 2015 (continued)
                                                                                                      • Men choose healthy foods both at retail and restaurants, women seek convenience of restaurant foods
                                                                                                          • Figure 41: Reasons to purchase at retail, by gender and age, February 2015
                                                                                                          • Figure 42: Reasons to purchase at restaurants, by gender and age, February 2015
                                                                                                          • Figure 43: Reasons to purchase at restaurants, by gender and age, February 2015
                                                                                                      • Consumer Data – By Generation

                                                                                                        • Key points
                                                                                                          • Older Millennials seek foods that are socially responsible, and will pay for convenience
                                                                                                              • Figure 44: Restaurants/daypart where consumers purchase – Any restaurant purchase, by generations, February 2015
                                                                                                              • Figure 45: Daypart where consumers purchase – Any retail purchase, by generations, February 2015
                                                                                                              • Figure 46: Reasons to purchase at restaurants, by generations, February 2015
                                                                                                              • Figure 47: Attitudes toward food purchases, restaurants versus retail, by generations, February 2015
                                                                                                              • Figure 48: Reasons to purchase at retail, by generations, February 2015
                                                                                                            • Health drives Baby Boomers, convenience drives older Millennials to retail
                                                                                                                • Figure 49: Attitudes toward food purchases, restaurants versus retail, by generations, February 2015
                                                                                                                • Figure 50: Attitudes toward food purchases, restaurants versus retail, by generations, February 2015
                                                                                                            • Consumer Data – By Income

                                                                                                              • Key points
                                                                                                                • Retail offers more healthy snacks for higher incomes
                                                                                                                    • Figure 51: Retail stores/daypart where consumers purchase – Dinner, by household income, February 2015
                                                                                                                    • Figure 52: Restaurants/daypart where consumers purchase – Any restaurant purchase, by household income, February 2015
                                                                                                                    • Figure 53: Retail stores/daypart where consumers purchase, by household income, February 2015
                                                                                                                    • Figure 54: Retail stores/daypart where consumers purchase – Snack, by household income, February 2015
                                                                                                                  • Burgers, sandwiches, and seafood preferred in restaurants; desserts win at retail
                                                                                                                      • Figure 55: Types of food purchased, restaurants versus retail, by household income, February 2015
                                                                                                                      • Figure 56: Types of food purchased, restaurants versus retail, by household income, February 2015 (continued)
                                                                                                                      • Figure 57: Types of food purchased, restaurants versus retail, by household income, February 2015
                                                                                                                      • Figure 58: Types of food purchased, restaurants versus retail, by household income, February 2015 (continued)
                                                                                                                    • Despite higher income, consumers seek to save on beverage costs
                                                                                                                      • Figure 59: Types of food purchased, restaurants versus retail, by household income, February 2015
                                                                                                                  • Consumer Data – By Race and Hispanics

                                                                                                                    • Key points
                                                                                                                      • Hispanics and Blacks are content to eat foods at retail
                                                                                                                          • Figure 60: Attitudes toward food purchases, restaurants versus retail, by race/Hispanic origin, February 2015
                                                                                                                          • Figure 61: Attitudes toward food purchases, restaurants versus retail, by race/Hispanic origin, February 2015
                                                                                                                          • Figure 62: Attitudes toward food purchases, restaurants versus retail, by race/Hispanic origin, February 2015
                                                                                                                          • Figure 63: Attitudes toward food purchases, restaurants versus retail, by race/Hispanic origin, February 2015
                                                                                                                        • Asians or Pacific Islanders more enthusiastic about retail, during any daypart
                                                                                                                            • Figure 64: Restaurants/daypart where consumers purchase – Any restaurant purchase, by race/Hispanic origin, February 2015
                                                                                                                            • Figure 65: Retail stores/daypart where consumers purchase, by demographics, February 2015
                                                                                                                          • Hispanic focus on natural foods, either at retail or foodservice
                                                                                                                              • Figure 66: Retail stores/daypart where consumers purchase – Snack, by race/Hispanic origin, February 2015
                                                                                                                              • Figure 67: Retail stores/daypart where consumers purchase – Breakfast, by race/Hispanic origin, February 2015
                                                                                                                            • Hispanics prefer to purchase burgers at retail, to save money
                                                                                                                                • Figure 68: Types of food purchased, restaurants versus retail, by race/Hispanic origin, February 2015
                                                                                                                                • Figure 69: Types of food purchased, restaurants versus retail, by race/Hispanic origin, February 2015 (continued)
                                                                                                                            • Consumer Data – By Parents

                                                                                                                              • Key points
                                                                                                                                • Households with younger children are focused on health
                                                                                                                                    • Figure 70: Attitudes toward food purchases, restaurants versus retail, by presence of children in household, February 2015
                                                                                                                                    • Figure 71: Restaurants/daypart where consumers purchase – Any restaurant purchase, by parental status by gender with children in household, February 2015
                                                                                                                                    • Figure 72: Retail stores/daypart where consumers purchase, by demographics, February 2015
                                                                                                                                    • Figure 73: Reasons to purchase at restaurants, by parental status by gender with children in household, February 2015
                                                                                                                                  • Parents of kids aged 6-11 most likely to purchase retail snacks, and fathers focused on saving
                                                                                                                                      • Figure 74: Retail stores/daypart where consumers purchase – Snack, by presence of children in household, February 2015
                                                                                                                                      • Figure 75: Retail stores/daypart where consumers purchase – Breakfast, by parental status by gender with children in household, February 2015
                                                                                                                                      • Figure 76: Retail stores/daypart where consumers purchase – Breakfast, by presence of children in household, February 2015
                                                                                                                                    • Fathers with children most likely to order foods at restaurants
                                                                                                                                        • Figure 77: Reasons to purchase at restaurants, by parental status by gender with children in household, February 2015
                                                                                                                                        • Figure 78: Attitudes toward food purchases, restaurants versus retail, by presence of children in household, February 2015
                                                                                                                                        • Figure 79: Attitudes toward food purchases, restaurants versus retail, by parental status by gender with children in household, February 2015
                                                                                                                                    • Consumer Data – By Household Size

                                                                                                                                      • Key points
                                                                                                                                        • Larger households rely on retail for convenience, quality, and speed
                                                                                                                                            • Figure 80: Restaurants/daypart where consumers purchase – Any restaurant purchase, by household size, February 2015
                                                                                                                                            • Figure 81: Retail stores/daypart where consumers purchase, by demographics, February 2015
                                                                                                                                            • Figure 82: Reasons to purchase at retail, by household size, February 2015
                                                                                                                                            • Figure 83: Attitudes toward food purchases, restaurants versus retail, by household size, February 2015
                                                                                                                                            • Figure 84: Attitudes toward food purchases, restaurants versus retail, by household size, February 2015
                                                                                                                                          • Larger HHs seek to save money and want natural foods in foodservice
                                                                                                                                            • Figure 85: Reasons to purchase at restaurants, by household size, February 2015
                                                                                                                                            • Figure 86: Reasons to purchase at restaurants, by household size, February 2015
                                                                                                                                            • Figure 87: Attitudes toward food purchases, restaurants versus retail, by household size, February 2015
                                                                                                                                        • Consumer Data – By Area

                                                                                                                                          • Key points
                                                                                                                                            • Urbanites are pickier about quality and buy more restaurant meals
                                                                                                                                                • Figure 88: Attitudes toward food purchases, restaurants versus retail, by area, February 2015
                                                                                                                                                • Figure 89: Attitudes toward food purchases, restaurants versus retail, by area, February 2015
                                                                                                                                                • Figure 90: Attitudes toward food purchases, restaurants versus retail, by area, February 2015
                                                                                                                                                • Figure 91: Restaurants/daypart where consumers purchase – Any restaurant purchase, by area, February 2015
                                                                                                                                                • Figure 92: Retail stores/daypart where consumers purchase, by demographics, February 2015
                                                                                                                                              • Urban residents focus on natural foods, both at foodservice and retail
                                                                                                                                                  • Figure 93: Reasons to purchase at restaurants, by area, February 2015
                                                                                                                                                  • Figure 94: Reasons to purchase at retail, by area, February 2015
                                                                                                                                                  • Figure 95: Reasons to purchase at restaurants, by area, February 2015
                                                                                                                                                  • Figure 96: Reasons to purchase at retail, by area, February 2015
                                                                                                                                              • Appendix – Trade Associations

                                                                                                                                                • Appendix – Methodology for Correspondence Analysis

                                                                                                                                                  Companies Covered

                                                                                                                                                  • Kings Supermarkets (USA)
                                                                                                                                                  • Roundy's, Inc
                                                                                                                                                  • U.S. Department of Agriculture
                                                                                                                                                  • Whole Foods Market Inc

                                                                                                                                                  Competitive Shift: Retail into Foodservice - US - May 2015

                                                                                                                                                  US $3,995.00 (Excl.Tax)