Supermarket sweep: How to beat the meal deals

09-May-2013 - Last updated on 01-Aug-2024 at 11:44 GMT

Consumers are increasingly opting for supermarket ‘meal deals’ which typically offer a meal for two for £10 or under

As supermarkets begin to take a bigger bite of the foodservice sector, many restaurant operators are left struggling to compete. Could an extra emphasis on lunchtime offerings and more seating options provide that crucial point of difference?

New research from business advisory firm The NPD Group has found that supermarkets enjoyed almost 46 million more out-of-home eating visits in 2012 than they did three years ago.

The primary motivation for these visits was ‘didn’t want to cook/nothing at home’ – accounting for an additional 28 million more visits to supermarkets and their convenience stores over the same three-year period.

“Previously, more traditional restaurants would typically benefit from people not wanting to cook or having nothing in, but more and more consumers are answering this need with a trip to a supermarket,” said Guy Fielding, director of business development for The NPD Group.

“In many cases choosing the smaller local c-stores with their extensive prepared ready-to-eat meals and snacks.”

Rapid growth

As the below chart shows, supermarket visits were up across all out-of-home eating occasions over the past three years.

And, as supermarkets continue to expand in numbers and consumers opt for cheaper ‘meal deals',Fielding says neighbouring foodservice businesses should expect direct competition, especially as their product mix and promotion strategies are refined and adapted to the local trade.

“We expect to see more ready-to-eat hot offerings; variations on portion sizes, more drink and snacking options, and a heavier focus on breakfast, an area that is enjoying rapid market growth,” he added.

Taste the difference

Just a few weeks ago, BigHospitality spoke to a number of ethnic restaurant operators about the issue, concluding that it would be of less concern to operators offering a very specialist product, where the difference in taste could be more easily recognised.

Restaurant consultant Maurice Abboudi – one of the team behind contemporary Japanese concept K10 Sushi – highlighted sushi and pizza as a couple of examples.

“Supermarket food is becoming extraordinarily good – restaurant quality,” he said. “But it is very costly and labour intensive for them to get really good sushi.

“And a domestic oven will not get to the same temperature as a commercial wood-burning or conveyor belt oven which takes the moisture out of dough.”

The solution

Ask — On-premises seating continues to be an advantage for most high street operators

So, what can other operators do to avoid a drop in customers? Fielding from the NPD Group has offered up a couple of potential solutions – better lunch offerings and more seating options.

“All is not lost,” said Fielding. “There are still opportunities for restaurants and takeaway operators to focus on their lunch offerings, and in particular, to consider offering inside and outside seating.

“At the moment, the lunch eating occasion is being left behind by growth in breakfast, dinner and snacking. As most supermarkets lack on-premises seating facilities, foodservice operators have a great opportunity to capitalise on on-premises seating - a factor that continues to be an advantage for most high street operators.

“However, foodservice operators ignore other factors at their peril – consumers are more than happy to take-away if the ambiance and atmosphere don’t meet their expectations.”

Or perhaps you could adopt an ‘if you can't beat 'em, join 'em’ approach, as Giraffe did with Tesco earlier this year. 