Millennials driving food trends says Restaurants Canada report

Toronto – Millennials are driving Canada’s foodservice industry, according to Restaurants Canada’s latest foodservice trends report.

The association held a breakfast yesterday to discuss the findings of its annual report entitled 2018 Foodservice Facts, including Canadian chefs’ current and anticipated food trends.

According to the report, the overall picture is positive: The past couple of years have been good for the Canadian foodservice industry overall, with growth of 5.1 per cent in 2017 after advancing 5.9 per cent in 2016. This helped annual total foodservice sales to climb to more than $84 billion.

Millennials
Millennials were seen as one of three factors driving foodservice sales. They are the key drivers of growth, with traffic up nine per cent – triple the size of any other group. And in 2017 millennials accounted for almost three-quarters of dollar growth and 79 per cent of traffic growth.

“Millennials are now the largest category of foodservice spenders in Canada,” said Shanna Munro, president and chief executive officer of Restaurants Canada, in a news release. “They are driving trends such as third-party delivery, mobile payments and changing menus. Millennials are looking for bold flavours, new experiences they can then share and meals that can be customized and portable to observe to their busy, on-the-go lifestyles.”

Breakfast
The breakfast category continues to grow, driven by a need for convenience and portability. Diners are eating the majority of their meals and snacks on the go, with 70 per cent of breakfast and 56 per cent of supper orders at a restaurant eaten off-premises. Lunch is the exception, where half of meals are eaten on-premises versus 48% that are off-premises.

The top five reasons consumers are more likely to eat off-premises (according to the Ipsos Foodservice Monitor):

1. Portable (33%)
2. Eaten quickly (25%)
3. Picks me up (24%)
4. Energy boost (18%)
5. Guilty pleasure (17%)

Chain restaurants have adjusted accordingly by integrating all-day breakfast options to their menus to appeal to millennial tastes.

The report also suggests a healthy economy, low unemployment rate and rising housing valuations boosted consumer confidence in Canada at the end of 2017 to its highest level in 10 years. This has propelled spending at restaurants, especially in British Columbia, Quebec and Ontario.

Five other trends Restaurants Canada is seeing that are changing food service:

• Plant-based food options
• Continued rise of healthy options
• Food waste – using less and/or using waste to develop dishes
• Energy efficiency
• Technology is encroaching into all aspects of the restaurant business

The role of technology
A restaurant’s online and mobile presence has become more important than ever, and the need is growing.

“Thirty-eight per cent of operators are planning to introduce online or app ordering in 2018, while 28% are investing in inventory management software and apps to control costs,” said Chris Elliott, senior economist at Restaurants Canada.

Most restaurateurs agree technology makes restaurants more productive, speeds up customer service and helps increase sales, the report said. As for customers, more than four in 10 Canadians base their dining decision on whether the restaurant offers free Wi-Fi access.

Pizza’s popularity
Of special interest to pizzerias is pizza’s position in sixth place among the top foods of 2017. Pizza is the top choice of 4.5 per cent of people surveyed, behind french fries, hamburgers, chicken and turkey, breakfast sandwiches and sandwiches. That’s down from 5.3 per cent of people – but up a couple places from eighth place in 2016 (above muffins and doughnuts). The new item to watch this year is breakfast sandwiches.

Restaurant industry employment falling
Despite a strong year of overall growth in the industry, foodservice employment is falling. Worker shortages and higher minimum wages have caused industry-wide labour pains. After growing by 11,000 jobs in 2016, foodservice employment unexpectedly fell by 11,000 jobs in 2017.

“Labour shortages put a damper on investment and expansion,” said Lauren van den Berg, the association’s national vice-president of government relations. “Restaurants are at risk if they can’t properly be staffed.”

“It’s important to understand that although the industry is experiencing growth, profits are not flowing through to the bottom line,” adds Elliott. “While overall topline growth has increased, bottom lines continue to be stagnant at 4.2 per cent for the past three years. Raising costs across the board and driving the growth.”

Other survey highlights

• Annual total foodservice sales are projected to reach $88.7 billion in 2018.
• By 2022, combined commercial and non-commercial foodservice sales will exceed $100 billion.
• 1.2 million Canadians are directly employed in food service.

For more information, visit restaurantscanada.org.