78% of restaurant companies plan to open new restaurants and 74% will increase their workforce by 2025
- The profile of today's consumer
- Speciality foods are leading growth
- Talent in an employer sector
- Delivery and ‘Take Away’ redefine consumption
- Technology transforms the customer relationship
- Commitment to sustainability and healthy eating
- Expectations for 2025
Marcas de Restauración (MdR), KPMG and Circana have presented the Observatorio de la Restauración de Marca 2024, an economic report that has exhibited its consumption figures, from which it can be seen that, despite the current geopolitical context, the companies associated with MdR continue to be at the forefront.
In this scenario in which Spaniards choose very well when and where to go out, catering contributes a total of 6,012 million euros GVA of the total; more than 8,100 million euros of annual turnover and a total of 920 million euros of annual tax contribution.
Branded Foodservice continues to be the engine of growth, exceeding 30 points of market share and growing in both expenditure and traffic in its establishments over the last year, as revealed by Circana's CREST Panel.
The aforementioned study establishes that organised catering is the driving force behind economic development in Spain and accounts for more than 4.35% of GDP. The GVA (Gross Value Added) that MdR could generate per year has been estimated at 3,365 million in direct value and 2,647 million euros in indirect value per year. This measure provides an insight into the highly efficient value creation of the catering activity carried out by MoR associates. When it comes to assessing the year ahead, the groups surveyed are optimistic: 90% plan to increase their turnover, 78% plan to maintain or exceed their current pace of openings and 74% plan to increase their workforce by 2025.
MdR CEO Adriana Bonezzi, in an interview with this journalist, explains that the restaurant sector contributes significantly to Gross Domestic Product and employment. It is made up of a wide range of establishments from small bars and cafés to haute cuisine restaurants.
As such, MdR is made up of 49 member groups, more than 170 brands and some 8,000 outlets, representing 71% of the branded restaurant sector's representation in terms of sales share and an annual job creation of 168,000 FTE jobs (66,758 indirect jobs, 85,803 direct jobs and 15,621 induced jobs). ‘78% of restaurant companies plan to open new restaurants and 74% will increase their workforce by 2025,’ announced Bonezzi.
In the same vein, Circana offered a comprehensive view of food and beverage consumption (in and out of the home), on the total perimeter resulting from the sum of ‘Food Service’, which continues to grow by 2.8%, leveraging on an average growth in spending per diner of more than 3.4%, and with a stabilisation in the number of visits (-0.5%).
The consumer's search for a memorable and specific experience, as well as the non-organic growth itself through the strong opening of new outlets, means that channels offering ‘specialities’ are growing in market share, both for FSR and QSR, with traditional FSR declining in spend and share.
On global consumer trends, the study highlights that price-sensitive consumers continue to seek memorable ‘experiences’ in their out-of-home consumption. Key elements for a terrace experience, restaurant atmosphere, free WIFI, digital ordering and payment, with live music.
The hours of consumption are subtly moving forward, becoming slightly Europeanised, although the bulk of consumption remains in the traditional peak hours in Spain. ‘Consumers are willing to pay more than twice as much for a lunch/dinner with friends/family than for a meal on a work/class day,’ Bonezzi said.
The growth of the Food Service market is matched by the pulse of the Branded Foodservice executives that KPMG has collected for this report. According to the vision of the companies, 39% have a positive perception of the sector's situation in 2024 and 9 out of 10 companies expect to close the year with an increase in sales, a figure that exceeds the expectations they had for this year.
However, inflation continues to have a high impact on the profitability of groups with 68% of respondents stating that their margins have decreased as a result. As a result, 77% will continue to take action to mitigate inflation and 84% consider it necessary to review their prices two or more times a year.
This scenario forces companies to continue making adjustments to simultaneously protect their profitability and competitiveness. To this end, according to Enrique Porta, partner in charge of Consumer and Retail at KPMG in Spain, ‘it is especially important to refine and optimise pricing strategies, an area that is becoming more sophisticated and in which technology is playing an increasingly important role’. In addition, the sector will accelerate the search for efficiencies in back office and operations, with seven out of 10 looking for improvements in this area.
In any case, companies are making progress in this area, with 22% of companies reporting that they have been able to protect their margins in the last year.
The profile of today's consumer
Circana points out that 70% of consumers demand that the industry continues to invest in the continuous improvement of the quality of its products. Quality in a food and beverage industry is the base of the pyramid of demands and needs of today's consumer, who also strongly demands to continue to find novelties and improvements in the speed of service.
But today there are other factors that also influence the choice of the final establishment. These include the availability of a terrace, the atmosphere of the establishment, the option of free Wi-Fi connection, live music in the establishment and, of course, the development of digital options for ordering and digital payment.
In a context that remains inflationary, consumers are expectant about the evolution of the offer and the experience and are willing to pay more if the experience justifies it, especially on special occasions such as lunches or dinners with friends and family. However, they remain price sensitive and expect their financial situation to remain stable.
Although global trends influence their consumption habits in some areas, Spanish consumers retain their Mediterranean gastronomic habits. For example, there is a slight trend towards more European consumption schedules, but the bulk of meals are still concentrated in the traditional peak hours in our country.
Speciality foods are leading growth
This detailed report has concluded that today's consumer is moving towards the search for concrete and memorable dining experiences outside the home.
This growing interest, coupled with the expansion of new speciality outlets, is driving growth in the Speciality segments (chicken, Italian, burger, poke, American, etc.) in both Fast Service Restaurant (FSR) and Quick Service Restaurant (QSR). Segments that are increasing their market share to the detriment of the traditional restaurant segment, which is suffering a slight decrease in spending and a reduction in its share, as shown in Circana's CREST Panel.
Talent in an employer sector
The foodservice sector is facing increasing difficulty in attracting and retaining talent.
According to data from this report in KPMG's executive survey, 87% of groups have had difficulty recruiting new employees in the last year, and 81% have experienced absenteeism problems. These figures are reflected in high turnover rates (58 % of groups with rates above 20 %) and absenteeism (30 % with rates above 10 %). Given its prominent position as a generator of employment, this sector is particularly exposed to changes in labour regulations that may be implemented.
Adriana Bonezzi, CEO of MdR, says: "It is a challenge to focus on career plans that allow us to develop the potential of our employees. At MdR we are committed to lead and promote, together with the institutions, all the necessary measures to reverse this situation and to make them become our brand ambassadors, convinced that we can build an even brighter future’.
Delivery and ‘Take Away’ redefine consumption
Consumers are becoming completely omnichannel also in terms of their consumption occasions in Foodservice. As Circana shows, although Spain is still a country of in-room consumption (68% of total spending by Spaniards), off-premise consumption options have been consolidated and now 25% of spending is done via Take Away and Drive Thru and 7% is done via Food Delivery.
This is even more marked for Branded Foodservice, where almost half of the expenditure (45% specifically) is for off-premise consumption, and where Take Away accounts for 29% and Delivery for 16% of the total expenditure made by national consumers. These figures are absolutely consolidated and growing, as reported by Circana's CREST Panel on a monthly basis.
This growth in off-premise business has generated friction with in-store service, since, according to KPMG, 48% of the groups surveyed reported problems of coexistence between the two channels, such as longer waiting times for customers in the store due to simultaneous attention to home delivery orders.
Technology transforms the customer relationship
The digitisation of in-store orders is consolidated as the main area of technology incorporation with 55%, but also the automation of back-office processes and personalisation and loyalty (48%). To this effect, 58% of respondents already have a loyalty club.
The adoption of Generative Artificial Intelligence in foodservice is an incipient process (16% have already integrated it and 42% will do so soon). In the words of Porta (KPMG) ‘consumer loyalty and personalisation of the experience are becoming a key competitive vector that could be reinforced by the progressive incorporation of Gen AI, a technology that is set to revolutionise the sector's relationship with its customers and enable new ways of interaction and transactions, such as social commerce’.
In this sense, KPMG highlights that social networks tend to be more transactional, which is why 61% of the executives surveyed believe that these platforms will be transformed into a sales channel, thus expanding business opportunities.
Commitment to sustainability and healthy eating
In this area, the sector is undergoing a profound transformation, adopting more sustainable and healthier models by 2025. Retailers will prioritise food waste reduction (68%), energy efficiency (61%), carbon footprint reduction (61%) and plastic substitution (52%).
At the same time, according to data obtained by KPMG for this Observatory, the gastronomic offer is evolving to offer greater diversity in menus and a better nutritional and environmental impact.
57% of companies will expand their offerings to include options for people with food intolerances, and 30% will incorporate vegetable alternatives. In addition, 40% will go for local suppliers, thus contributing to a positive impact on the environment and consumers' health.
Expectations for 2025
In this sense, Circana anticipates a scenario marked by an increase in the Consumer Price Index (CPI) for catering, while the prices of food and beverages for domestic consumption, although high, will remain more stable.
In this context, Edurne Uranga, Vice President of Food Service Europe, points out how ‘this scenario will generate an increasingly price-sensitive consumer in the foodservice sector who, in turn, will increase their search for memorable gastronomic experiences that justify the expenditure made on consumption occasions in foodservice establishments’.
Uranga adds that the consumer's greater exposure to global trends will mean that over the coming months we will see the arrival and development of booming global trends in Spain.
Amongst these, we can highlight the development of the Korean gastronomic offer (which will further boost the positive trend that chicken has amongst proteins at the current level in Catering). Today in Spain, promotional activity is present in 22% of consumption occasions in foodservice, well below the 38% of FR or the 34% of the UK. From the point of view of organised foodservice, KPMG points out that half of the respondents foresee a drop in traffic in the sector in the coming months. However, it is worth noting that 45% expect the average ticket per order to increase.
Carmen Chamorro García, CIP/ACPE director, graduate in International Relations, Global Terrorism and Business Tourism.