Despite a dismal 2012, food service operators have emerged in good shape with the possibility of some growth in the market this year, according to food service consultancy Horizons' Annual Review of 2012.
The review shows that operators have become resigned to the fact that current levels of business are the new norm and survival depends on maintaining business with offers and innovative menus.
Horizons' managing director Peter Backman said the lack of growth in the market during 2012 was fuelled by lack of consumer confidence, driven by fears over unemployment. Low interest rates has left consumers with less money in their pockets, which, together with intensive competition amongst food service operators, meant that people were becoming more choosey about where, and when, they ate out.
"The last few years have demonstrated that the majority of strong businesses survive. They have developed the systems, and mind-sets, that are effective in exceptionally tough times, and invested money in businesses that can actually deliver profit and growth."
"The continued use of vouchers and money-off deals means that the battle for consumers continues, particularly amongst mid-spend, high street operators. Operators are also experiencing competition from the retail sector, where keenly priced meal deals are still popular. "
"Some sort of bottom has now been reached or will be in early 2013. At some point during 2013 we expect consumer confidence to start returning and spend on eating out will start to rise again."
Backman said the year ahead would be characterised by the continued need for operators, and suppliers, to attract consumers with innovation in terms of food offers, discounting and new service styles, which perhaps might include a more embracing return to all-you-can-eat buffet styles of service.
By Janet Harmer
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