The foodservice industry is one of the industries that has been hit hardest by COVID-19, and it will be one of the industries that takes longest to recover. A market that is usually heavily dependent on dine-in revenue has seen consumers become nearly four times as likely to order a takeaway than eat in at a food outlet/restaurant since the start of the pandemic.

However, there is reason to be optimistic for a bullish recovery in foodservice spending during the rest of 2021 due to pent-up demand for eating out, as 43% of consumers are most looking forward to going out for a meal once social distancing measures are relaxed.

As working from home looks set to remain the norm for many office workers for a while longer, lunchtime sandwich shops/food-to-go formats will suffer from the decline in office working/commuting.

On the flipside, the shift to working from home for many employees is expected to see some eating out expenditure redistributed to foodservice venues within suburban and rural areas. There are opportunities for foodservice brands to increase their number of outlets situated along local high streets and in out-of-town locations, whilst the drive-through concept is likely to gain popularity as some consumers continue to avoid public transport.

• The impact of COVID-19 on the foodservice market.

• Changes in foodservice participation since the start of the pandemic.

• How the pandemic will shape consumer behaviour and eating out in future.

• Consumer participation and interest in emerging foodservice formats.

• Foodservice innovations that meet changing consumer needs and expectations.

The first COVID-19 cases were confirmed in the UK at the end of January 2020, with a small number of cases in February. Rapidly rising case numbers led to the first national lockdown, starting on 23 March. It wasn't until 15 June that non-essential stores were allowed to reopen, followed by pubs, restaurants, hotels and hairdressers on 4 July and many beauty businesses on 13 July.

By September, it had become clear that the UK was at the start of a second wave, and social distancing measures were intensified. Continued increases in infection numbers led to Wales implementing a two-week national lockdown from 19 October, England announcing a month-long lockdown from 5 November and Scotland introducing a new five-level system of coronavirus restrictions.

Despite these restrictions, however, case numbers continued to increase. All four UK nations tightened restrictions further in January 2021, effectively leading to a full UK-wide lockdown.

On 22 February, Boris Johnson announced the roadmap to an easing of restrictions in England, starting with the reopening of schools on 8 March, followed by easing of restrictions on outdoor gatherings on 29 March and with a hoped end to all restrictions by 21 June. The Welsh and Scottish governments also gave more details on their plans to ease restrictions, with both nations taking a slightly more cautious approach to the one planned for England.

The UK’s vaccination programme started on 8 December 2020, and with the Pfizer-BioNTech, Moderna and Oxford-AstraZeneca vaccines licensed for use in the UK, the government aims to offer a first dose of the vaccine to 32 million people by mid-April.

Mintel’s economic assumptions are based on the Office for Budget Responsibility’s central scenario included in its March 2021 Economic and Fiscal Outlook report. After the fall of 9.9% over the course of 2020, the scenario suggests that UK GDP will grow by 4% in 2021 and 7.3% in 2022.

GDP isn’t expected to return to pre-COVID-19 levels until Q2 2022, although this is six months earlier than the OBR forecast in November 2020, mainly because of the faster-than-expected rollout of vaccines.

Unemployment is expected to peak at 6.5% in Q4 2021. As with GDP, this is more positive than the OBR’s November forecast, but the OBR does raise the prospect of long-term scarring on employment, especially in the more exposed retail and hospitality sectors.

At the time of writing (21 April 2021) foodservice outlets in England are expected to be able to reopen indoor dining areas on 17 May, after outdoor areas were allowed to reopen on 12 April.

Meanwhile, takeaway or home delivery services are expected to continue to be consumers’ preferred out-of-home (OOH) dining occasions as long as the threat of the virus persists.

Wider participation in eating in at food outlets is expected to recommence when the vaccination programme has completed and the risk of COVID-19 is deemed to be very low.

This Report covers the UK foodservice industry.

Mintel’s market size is based on the following:

Foodservice: consumer expenditure on food and drink (ordered to eat/drink in or for takeaway/home delivery) in pubs/bars, restaurants, coffee shops, hotels (bars, restaurants and room service), roadside outlets/service stations and street food stalls or food courts.