Retail food service ready-to-eat foods on the rise

by Staff
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CHICAGO — The market for retail food service meals and snacks is growing as nearly 6% of the $62 billion consumed in commercial food service meals and snacks in a year are purchased at retail stores, according to The NPD Group. In addition, convenience stores represent an additional 7%.

"Consumers’ increasing use of food service for ready-made meals has long been recognized by grocery retailers as an opportunity," said Bonnie Riggs, NPD restaurant industry analyst and author of "Retail Meal Solutions" report. "For some time, retail stores have offered prepared foods in the deli department but have now expanded food service offerings to include a variety of cold and hot ready-to-consume meals and snacks."

Overall, retail food service represents a spending level close to $13 billion. Ready-to-eat meal and snack purchases increased 2% for the year ended August 2008. The quick-service restaurant segment grew by only 1%, and the full-service restaurant segment saw a downturn.

In addition, NPD found supper only represents 17% of retail meal solutions consumed with afternoon/evening snacks representing the largest share at 35% followed by lunch at 27% and breakfast at 21%.

"Retail outlets are more dependent on morning meals and PM snack purchases than Q.S.R.," Ms. Riggs said. "These are the on-the-go needs that are being met by retailers — consumers making those purchases on the way to work, to eat at work or in the car. Purchases that otherwise would have been made at Q.S.R."

Consumers are choosing retail options due to convenience, availability of healthier options, variety and affordability.

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