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An assessment of consumer spending on food outside the home, such as in restaurants, has found that the sector could fall in value by as much as €5 billion this year as a result of Covid-19.  

Bord Bia, the Irish Food Board, has published a paper which sets out the best and worst case scenarios for the market.

Its worst case forecast for the island of Ireland could see spending fall by 60% from €8.5 billion to just €3.7 billion.

Bord Bia also highlighted five key trends that are likely to have a longer lasting impact on the industry. 

These include streamlined and smaller menus with many operators likely to focus on those items that drive maximum revenue post-crisis.

It also predicts continued investment in take-away services, saying that the Covid-19 crisis has shown that having any off-premise strategy to diversify risk is a must. Digital strategies will become more important to operators of all types.

Bord Bia said there will be decreased emphasis on customisation and made-to-order services due to labour challenges and a move toward low prices among many consumers. 

It also predicts more ghost/delivery kitchen acceleration saying that as the food industry resets, more companies may decide to eliminate the dining room altogether to capitalise on longer-term, off-premise trends.

Bord Bia also forecasts consolidation in the sector with the acquisition of some players throughout the supply chain and risks to more vulnerable operations.

Maureen Gahan, a foodservice specialist at Bord Bia, said that while acknowledging the clear and ongoing damage to the Irish foodservice market, it is also important to begin thinking about how the industry re-starts and what permanent changes may ultimately stick into the future. 

“We understand from listening to food and drink suppliers servicing this market that access to timely data and insights is crucial for them as they look to revise their plans and activities for the second half of 2020,” Ms Gahan said.

She noted that the out-of-home channel was one of the most severely impacted by Covid-19, not just in Ireland, but world-wide, experiencing a near total collapse due to the temporary shutdown of the hospitality sector. 

“However, we also know that it is a hugely resilient industry and we have already seen a number of outlets transitioning their businesses to take-away and home delivery. Similarly, we have seen examples from our food and beverage producers that are pivoting their businesses to meet the new needs of their foodservice customers,” she added.

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