Consumer foodservice value in Western Europe continues to decline, with no recovery in sight; nevertheless, growth opportunities remain. Chained segments are experiencing growth in all categories, and key limited-service formats, such as fast casual and specialist coffee shops, show the potential for long-term opportunities. Strategy in Western Europe is now entirely about targeting these growth areas and, within them, finding ways to appeal to the particular preferences of European consumers.
Despite continually contracting regional figures, with no sign of significant improvement over the long term, growth can still be found within this difficult environment. The key to this strategy is looking beyond the masking effects of markets like Greece and Portugal that have been hit the hardest, to uncover areas of smaller, yet lucrative, growth underneath.
This means strategy in Western Europe is now very much about precise targeting rather than expansion on a grand scale. Those concepts seeing the fastest growth are present in key markets and key categories that are still thriving while others flounder. Key growth markets include Sweden, Turkey and France, with limited-service categories like fast food, specialist coffee shops and 100% home delivery takeaway coming out ahead.
Unequivocally, all growth in the markets over the forecast period will belong to chained segments. Indeed, the distinction between chained and independent operators continues to be the most important indicator of long-term success in the region. Over 2012-2017, chained segments in every single major foodservice category will see positive growth in Western Europe, while every corresponding independent market will contract.
This is not to say that growth among chains will come easily. Rather, the spoils will go to those operators best able to cater to the unique and rapidly evolving preferences of modern Western Europeans. These consumers are older, comparatively wealthy yet price-conscious, highly concerned with ingredient quality and responsible sourcing, and willing to spend on foodservice if the experience delivers high value for their money.
In order to appeal to these preferences, operators are offering brands that combine a full-service experience with limited-service prices, and bringing ingredient quality, freshness and environmental responsibility into the centre of their brand positioning.
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