Lower-priced dining offerings could perform well as consumers seek cheaper options. Last week, pub -operator Mitchells & Butlers outlined a value-food strategy to attract people who might usually opt for more expensive venues.
Domino's Pizza and Pizza Hut's online-delivery services both recently claimed an increase in sales, fuelled by belt-tightening consumers seeking cheaper alternatives to regular products.
McDonald's has also previously expressed confidence that it will 'catch' consumers who desert casual dining outlets and is lining up premium offerings to tempt them (Marketing, 8 July).
Katrin Roscher, an account manager at research company NPD Group, covering the UK food service industry, said: 'In the last quarter of 2007, quick-service restaurants really benefited from increased traffic.'
However, mid-market restaurant chains such as Pizza Express, Frankie & Benny's and La Tasca, could suffer, according to one analyst. 'The top end in London won't be hugely affected,' he said. 'It is highly probable that the mid-market will be hit.'
The extent of the sector's potential downturn hinges on whether unemployment -levels rise significantly, he added. 'The next few months will be crucial for the sector.'
Pressure on all sectors is coming from the burgeoning £2bn ready meals market. It offers an ever-widening array of products intended to provide a high-quality alternative to eating out.
Data file: Cheaper dining
- Traffic in fast-food restaurants rose by 3.2% in the first quarter of 2008 compared with the same quarter in 2007, according to The NPD Group/CREST.
- Over the same period, the average individual spend rose from £3.35 to £3.51.
- Since the launch of www.pizzahut.co.uk in March 2007, Pizza Hut's online sales have increased at an average of 25% a month, a trend it attributes in part to a high number of consumers choosing to eat in.
- Domino's Pizza's pre-tax profits for the 26 weeks to 29 June rose by 32.7% to £10.9m.
- The average meal price at most Mitchells & Butlers pubs is £3.96.
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