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‘Mega-Trends’ in Food Service Sector

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As operators we all want to be able to ‘look around the corner’. We hope to see what fabulous new thing needs to be -grabbed before it passes us by or what -horrible is -coming at us that we should avoid at all costs. We all want just a little edge, a touch of insight, a whisper telling us which way the wind will blow. Of course, that is a fool’s errand. No one has ever truly predicted the future, at least not at the micro-level. What we are able to do is to look at larger long-term movements which suggest what -people will do to make sense of their lives. Prof Christopher C. Muller evaluates ‘Mega-Trends’ which will have such an impact.

The Rapid Growth of the Hybrid Market-Restaurant

There has been a clear line between the out-of-home meal purchased at a restaurant and the in-home meal prepared from food purchased in a market. A new trend, the emergence of convenience markets with both restaurant and supermarket products is a greater challenge for both traditional food distribution channels.

Competition for the daily consumer-spend on meals has always been intense. Now, a third category of competitor, the hybrid convenience market, offers restaurant quality meals in an attractive setting. This is a challenge which must be met, especially for restaurant companies involved in take-out, delivery and hand-held food.

Simultaneous Global + Tribal Perspectives

Both the developed and the developing world economies are now intimately connected by wireless telecommunications. It is predicted that by 2015 there will be more smartphones, tablets and other mobile devices than human beings around the globe.

Yet at the same time, counter to predictions of a global village, the ‘us-them’ barriers of personal protection are thicker, the need to trust our truly intimate friends stronger today than 20 years ago when the Internet entered our lives.

Cashless is Cool/Cash is King

The ability to electronically manage everything with a swipe of our iPhone, from our airline boarding passes to the chewing gum at the airport kiosk, is no longer unusual; in many cases it is expected.

At the same time, this new system of exchange is expanding; we are also voluntarily surrendering more and more personal information about our purchase behaviours, collectively what is now called ‘Big Data.’

As in all paradoxical market situations, this one presents both opportunity and threats. Corporate restaurant companies will benefit tremendously from guests who find it more convenient to make purchases without needing to worry about having cash. The use of electronic funds transfers, on a smart–phone or at a restaurant table, will improve sales whether for the online ordering for delivery of a pizza or in the postponed purchase at the highest levels of three-star cuisine.

At the same time, pop-up-restaurants, mobile trucks and street food concepts will hurt mainstream brick and mortar establishments. Large companies can establish credibility with a disenfranchised demographic by focussing on the ‘cash is king’ no-credit counter-culture movement. Pubs, gastropubs, entertainment venues and other locally based restaurants can leverage the informality of a cash-only environment, even at the loss of consumer convenience.

Urbanism, Aging, and the Single Household

There are three key demographic trends which will impact the foodservice industry for the next 10-20 years; migration from rural to urban centres, the aging of developed regional populations, and the rise of single person households. These are all global in nature, but each will have a more serious effect on the traditional service economies of the Northern Hemisphere, especially Europe, North America and Japan.

The seven largest metropolitan areas in the world are all found in Asia, only three of the 20 largest cities are in North America (New York, Los Angeles, Chicago) and only one is in Europe (Moscow). This is in stark contrast to the fact that almost 4 out of 5 residents of North and South America live in urban centres, closely followed by Europe with more than two-thirds of its population already in cities, yet only 45 percent are urbanised in Asia.

This impact, though, will be felt very differently in each region of the world. The positive potential and the challenge for developing Asian countries will be how to absorb additional millions of people seeking employment, advancement and housing into their currently large urban centres.

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