Specialty Food Magazine

Winter 2019

Specialty Food Magazine is the leading publication for retailers, manufacturers and foodservice professionals in the specialty food trade. It provides news, trends and business-building insights that help readers keep their businesses competitive.

Issue link: https://specialtyfoodmagazine.epubxp.com/i/1061591

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Today's families are much more diverse: 67 percent of house- holds are singles or couples, we have multi-generational families, and ethnic diversity. That 'one meal option' no longer applies as indi- viduals at the table may be vegan, gluten-free, a keto diet enthusiast, or someone running out the door to soccer practice. Who has time to cook for all these options? Restaurant spending is up, representing about 50 percent of consumers' food spending. But Americans are also eating an increased number of meals at home, according to a recent NPD survey. Millennials are getting married and starting families and are finding that eating food at home is an economic priority and more aligned with their busy schedules. But, do they have time to cook? According to a recent Harvard Business Review article by Eddie Yoon, growth strategist and author of "Superconsumers: A Simple, Speedy and Sustainable Path to Superior Growth," only 10 percent of consumers say they love to cook. Forty-five percent indicate they outright hate it, and 45 percent are indifferent. Cooking has become another household chore and when they do enjoy it, it is primarily for entertaining on weekends. But consumers have many options that allow them to eat out while staying at home. Meal Delivery: Foodora, Grubhub, SkipTheDishes, DoorDash, and Uber Eats have transformed urban meal delivery. These gig economy services have added thousands of restaurants to their offerings, allowing consumers to order quickly online for immediate delivery of a variety of menu options. Restaurant Delivery: Widely available overall and growing to include even fast-food chains. In Asia, the Middle East, and Latin America, McDonald's has launched a meal delivery system called McDelivery. Through this service, McDonald's delivers its products 24 hours a day to households and apartment dwellers. Grab and Go: Most grocery stores have set up grocerant services to offer freshly prepared salads, sandwiches, and meals at their retail store for convenient pickup. U.K. retailers pioneered the fresh pre- pared foods market by offering commuters fully prepared meals to heat and eat at home. Meal Kits: While not ready to eat, meal kits are a convenient alternative to cooking from scratch with fresh ingredients and curated recipes. Starting with the meal kit subscription models of Blue Apron, Graze, HelloFresh, and Home Chef, shoppers can now find meal kits at such traditional grocers as Kroger, Wal-Mart, and Albertsons. They can also find meal kits at unexpected retail locations like Williams Sonoma, Martha Stewart, and Amazon Go. More heavily curated meal kits are now being sold that offer specific meals for diabetics, those who eat gluten-free, and kits with other nutritional food alternatives. The online food delivery market currently has a low penetra- tion with 10 percent of the U.S. foodservice market, according to a June 2018 report from UBS Evidence Lab called "Is the Kitchen Dead?" But it is expected to grow dramatically over the next decade, driven by lower delivery costs, shared kitchens achieving economies of scale, increased demand by time-starved households, and innova- tions in packaging to allow fresher food presentation. Ultimately, online food delivery sales can chip away at money spent in restaurants in the U.S., to the tune of 40 percent of total restaurant sales—or $220 billion—by 2020, according to some esti- mates. More consumers reported ordering food for delivery in the past six months of 2018, 47 percent versus 44 percent over the same period in 2017. Forty-three percent of consumers who ordered food for delivery say it replaced a meal at a restaurant, up from 38 percent in 2016, suggesting incremental cannibalization of dine-in meals. Expect to see massive industry consolidation as meal delivery services must balance the costs of labor and transport with the convenience of multiple menu options, delivery quality, and competition from supermarkets. WINTER 2019 89

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