The latest UK Eating Out Market Report (EOMR) showed that despite the challenges posed on the sector by high inflation, which has hindered growth in certain market segments, the market has been forecasted to grow 4.6% compared with 2019 levels.
According to the report, which quantified the size and growth of the channel and market forecasts from 2023 to 2026, there has been positive movement with market penetration in recent months, indicating increased consumer confidence.
Furthermore, consumer spending was also expected to improve towards the end of the year alongside easing energy bills.
Data from Lumina’s Eating and Drinking Out Panel (EDOP), released earlier this year, showed eating and drinking out occasions in the on-trade were in year-on-year decline, attributed to the cost-of-living crisis.
However, despite a decline in the frequency of eating out occasions in hospitality settings, the figures indicated participation and spend rates had increased.
The latest EOMR report, which also took information from the 1,500 consumers surveyed for Lumina’s recurring EDOP, additionally found the number of new premises opening could outpace business closures this year, driving an outlet compound annual growth rate of 0.3% from 2023 to 2026.
However, the report claimed this was largely driven by coffee shops, fast food and sandwich/bakery venues capitalising on growth opportunities in diverse formats and locations, including travel hubs, high streets and out of town destinations.
This comes data from the latest Business Confidence Survey CGA by NIQ and Fourth earlier this week revealed business leaders were torn on how they feel about trade.
The quarterly poll showed more than half (54%) of leaders felt optimistic about business prospects over the next 12 months, an increase of 7% vs the previous survey, and more than double the number (22%) who felt pessimistic.
In addition, the survey revealed the proportion of operators feeling confident about the eating and drinking out market in general had risen to 40% quarter-on-quarter.
CGA by NIQ director of hospitality operators and food EMEA Karl Chessell said: “All our research shows consumers remain eager to eat and drink out when they can, and business leaders are rightly confident about the long-term outlook for hospitality.
“Nevertheless, the relentless rise in bills for businesses and consumers alike leaves many firms and jobs extremely vulnerable. Until inflation finally eases conditions will remain very difficult, and hospitality deserves targeted Government support to mitigate costs.”