Grab-and-Go Lunch Boosts C-Stores’ Bottom Line

IRI says the sandwich, salad and sushi to-go culture gives U.K. convenience retailers £36 million boost.

July 31, 2017

BRACKNELL, U.K. – Food to-go is one of the fastest growing categories sold by convenience retailers, according to IRI. Sandwiches, sushi, salads and snacks purchased to go grew 6.6% in the high street multiple (which include Co-op Food, Tesco Express, Little Waitrose and Sainsbury’s Local) for the year ended March 25, 2017, boosting revenues by £36 million for these stores.

IRI claims that retailers have capitalized on the British shopper’s culture for convenience, expanding their ranges to include more innovative offerings than the lunch time sandwich. The sector now sells more than 1.4 billion meals, meaning that on average every person buys an average of 20 food to go meals a year.

Across all retailers, sales of sandwiches grew by 3.8% to £1.4 billion and while they still account for most volume sales, it is baguettes, salads and sushi that are showing faster growth. Ready to eat salads for example grew 5.1% to £800 million while sales of sushi grew by 12% to £100 million.

“Ready prepared food is a way of life for most time-poor shoppers today who adopt a ‘buy-it-when-I-need-it’ approach to grocery shopping and who are eating out more,” said Martin Wood, head of strategic retail insight at IRI. “Now that there are more choices available, including sushi and salad, shoppers don’t need to compromise their health.

“There are also some really good ‘meal deals’ being offered that add a drink , with more convenience retailers also providing fresh coffee, and/or a snack to the sushi or sandwich lunch at a price that often works out a lot cheaper than all of the component parts,” added Wood. “This is encouraging people to buy their breakfast, lunch or anytime meal on the way to work or home, boosting sales across not just the food to go category but also snacks and beverages too.”

According to IRI, sales of beverages and snacks across all convenience retailers are also growing. Single-serve soft drinks rose by 3.3% in sales value to just over £3 billion while single-serve salted snacks rose +0.4% to £0.7 billion. Collectively food to go, drinks and snacks are worth £7 billion annually for all retailers.

However, independent convenience retailers, including groups like Budgens, Londis, Spar, Costcutter and Nisa, that are more dependent on selling sandwiches, show much slower growth in food to go category than the multiple convenience retailers like Tesco Express, Co-op, Sainsbury’s Local, OneStop, McColls and Little Waitrose. All convenience retailers grew value sales of food to go by 5% in the last year (value sales of £865 million) but this was driven by the high street retailers with growth of 6.6% (to £584 million) and petrol forecourts and travel outlets up 2.9% (to £185 million). Independent convenience retailers showed a decline in food to go sales of -0.4% (to £96 million).

“There is a huge opportunity for independent convenience retailers to work with their wholesale and buying group partners to identify a broader range of ‘food to go’ options. In this way they can capitalize on these changing consumer behaviors,” concluded Wood.

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