Growth in foodservice and in-store bakery isn’t slowing

FMI — The Food Industry Association today released two reports—Power of Foodservice at Retail and Power of In-Store Bakery—that find these departments continue to offer a high level of value for shoppers. One out of every four shoppers (25%) cite replacing restaurant meals with foodservice options, an increase from 17% the previous year. Additionally, the in-store bakery department provides grocery shoppers indulgence at a good value through convenience, experience and relevance.  

"For years we’ve found that shoppers simply did not think of the grocery foodservice department when planning their meals. But, as shoppers continue to prepare more meals at home, that trend is changing," said Rick Stein, vice president of fresh foods at FMI. “Shoppers are creating hybrid meals, which include some scratch cooking with some pre-prepared items. This hybrid meal approach means shoppers want convenience and experience and they are finding it in the foodservice, deli, and bakery departments.”  

Cost and convenience  

Cost is a primary factor for foodservice choices, with 47% of shoppers identifying it as a top decision-making factor. Hybrid workers increasingly choose deli-prepared options for lunch, with lunchtime exhibiting the most significant increase in purchases. Most shoppers (68%) intend to continue purchasing deli-prepared foods, with 20% indicating their plans to increase these purchases. 

Shoppers’ focus on health and well-being 

Shoppers are making conscious choices for nutritious or healthy options when selecting deli-prepared foods, with 65% reporting at least some focus on nutritional value. However, there is room for growth, with only one-third of shoppers satisfied with the healthy options. Health-conscious grocery shopping extends to the bakery department, with two-thirds indicating that they pay attention to at least one nutrition claim when shopping for bakery items. 

Ways to differentiate in foodservice and bakery 

Shoppers reported wanting many features traditional restaurants or take-out services offer including a variety of cuisines, online ordering capabilities (62%), and easy pick-up (59%) or delivery (48%). For the in-store bakery, nearly half (49%) of shoppers prefer ordering specialty bakery items using technology and 47% would use technology to design and order specialty bakery items.

Stein emphasizes, "Retailers need to adopt a restaurant-like mentality for foodservice and deli. Present features that shoppers appreciate, including online ordering, easy pick-up, and delivery, to boost the convenience factor.” He added, “For the bakery, freshness is still a top priority for shoppers as is the ability to round out their meals with items like bread rolls or dessert options. Adding technology features that offer convenience is also part of delivering in-store bakery shoppers value." 

For more information and to download the reports, visit www.FMI.org/FreshFoods.