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2014 penton industry overview 3 17-14 (march update)
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- 2. Polar Vortex Update •Weather affecting businesses across most of the U.S. • Retail down 0.4% in Jan 2014 (projected to be flat) • Flight cancellations – hurts restaurant travel/tourism spending • Online shopping increased (foodservice delivery, however, did not increase as a result) • FSR hit hardest along with B&I and K-12 (office and school closings) • Across all segments, Technomic forecasted growth for 2014 is expected to decrease by a full percentage point Source: Technomic, Inc. Foodservice doesn’t have the benefit of a “catch up” (purchases not deferred to a later time)
- 3. Fast Casual Quadrupledin a Decade • Food offerings competitive • Environments are pleasing and many facilities are new • No tipping at FC leads to increased overall value to customers • FC also has more control over experience (no servers) • Customers also in control consumption and customization The top 150 fast- casual concepts posted aggregate sales of nearly $26 billion in 2012, up 13.1% from 2011, and is expected to have maintained momentum through 2013. Sources: Bellwether Food Group, Inc.; Technomic, Inc. QSR 69.5% FCR 8.1% CDR 17.6% MSR 4.8% QSR 72.6% FCR 2.7% CDR 17.8% MSR 6.9% 2012 Total Top 100 Sales: $211 B 2002 Total Top 100 Sales: $135 B 5.4% FCRs 3.1% QSR 2.1% MSR 0.2% CDR
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- 5. Growth in SmartphoneUsage Source: Go-Globe.com … with continuing growth in smartphone ownership worldwide. Most of the world is already on mobile… 2O2O VISION
- 6. How Consumers Interactwith Restaurants Today Sources: National Restaurant Association, 2014 Restaurant Industry Forecast All Adults Children under 18 in household Look up locations or directions 67% 80% Order takeout or delivery 52% 67% Use rewards or special deals 50% 65% Make a reservation 46% 56% Look up nutrition information 42% 54% Pay for your meal 24% 32% Consumers who say they would be likely to use a smartphone or tablet or restaurant- related activities Smartphone Activities in Restaurant All Adults Children under 18 in household Electronic payment system at the table 47% 55% Electronic ordering system at the table 40% 52% Menus on iPad/tablets 37% 48% Self-service, touch-screen kiosk for ordering 43% 54% Consumers who say they would be likely to use the following technology options in restaurants Using Restaurant Technology
- 7. Investing in theTechnology 21% 24% 9% 27% 18% 13% 23% 16% 22% 21% 4% Equipment upgrades Redesign of exterior/interior Technology upgrades Marketing Can't invest right now Other investment area 2012 2014 Source: NRN Restaurant Operator Survey (December 2013) In 2014, my business plans to put more money behind:
- 8. Operators Willing toInvest in Technologies Sources: National Restaurant Association, 2014 Restaurant Industry Forecast Family Dining Casual Dining Fine Dining Quick Service Fast Casual ALL RESTAURANTS Online ordering 57% 63% 48% 77% 89% Ordering via smartphone app 45% 49% 30% 73% 88% Wi-fi for customers 85% 93% 87% 87% 77% Mobile/wireless payment options 43% 58% 54% 75% 77% Nutrition information online or via smartphone/tablet app 46% 57% 48% 80% 80% FULL SERVICE RESTAURANTS Electronic ordering at the table 28% 48% 30% Electronic payment at the table 48% 65% 59% Menu of iPad/tablet at the table 36% 54% 50% Wine/beer/cocktail list on iPad/tablet at the table 31% 53% 56% LIMITED-SERVICE RESTAURANTS Self-service, touch-screen ordering terminals 47% 57% Video menu boards 78% 68% Restaurant operators who believe these technology options will become popular within their segments in the future More Technology Options on the Horizon
- 9. At the Table •Guest self-ordering • Suggestive selling • Interactive feedback from guests to the restaurant • Wireless networking • Some touch-screen devices that make up the entire tabletop 2O2O VISION
- 10. At the Counter(F.O.H.) • Mobile point-of-sale • Digital wallets • Facial-recognition software Immediate recognition of customers and their preferences • Digital menu and marketing boards 2O2O VISION
- 11. Technology vs. Adoption •Technology is coming, question is around adoption • Which chains will convert first? • Will independents be able to implement or afford? Technology will certainly make operators’ jobs easier… but it must also enhance the customer experience to drive value
- 12. REAL GROWTH (2014): 0.5% PURCHASES(2013): $10.0 billion SALES (2013): $18.2 billion K-12 Schools Sources: Technomic, Inc.; Food Management What’s Trending? • Final requirements from Healthy Hunger-Free Kids Act being implemented • July 1 requirement that a full cup of fruit is served at breakfast comes into effect • New regulations decreasing lunch program participation • 1.8 million kids lost from program in 3 years • Supper programs replacing after-school snack programs • Unpaid meal charges remain an issue • 2017 looms large because of sodium restrictions
- 13. Summary • Big StableMarket • Sluggish Growth Continues • Labor, Healthcare, Food Costs Remain a Problem • Market Share Theft Plus Operational Efficiency • Big Winners Amongst the Flatness • Technology Adoption Soaring • Fast Casual Continues to Drive the Market
Editor's Notes
- #4 https://blogs.technomic.com/a-look-back-on-the-year-in-fast-casual/
- #8 Investing in the Future Operators who planned to make improvements this year were almost evenly split between investing in a redesign and putting money behind marketing efforts. A slightly smaller group said they planned to invest in technology upgrades. About one-fifth of respondents said they can’t divert any funds for improvements now.
- #9 Idea: start with what Operators are implementing
- #12 Problem: Will consumers adopt and use?
- #13 Arrows indicate increase for that statistic over previous year. Dash means equal to previous year.