Welcome!

News Feed Item

Restaurant Chains Globally Face Complex Demands from Today's Health-, Technology- and Value-conscious Diners, According to New AlixPartners Study

Report includes a nine-country consumer survey and more than 60 executive interviews; finds that among those planning to dine out more, Chinese are first and Americans last; uncovers a high-low 'barbell effect' taking hold in dining spending; finds that r

NEW YORK, NY--(Marketwired - October 19, 2016) - Restaurant chains and their suppliers across the world are facing complex, often-conflicting demands from today's ever-more health- and technology-conscious consumers who are also, in many cases, more value-conscious than in recent times. At the same time, though, opportunities await those in the industry who can uncover international growth opportunities, focus on the right technology and maximize supply chains to help them profit from such trends today as more "on-the-go" dining and a growing demand for sustainable ingredients and supply practices. That's according to a new study, "Feeding the Global Consumer," from AlixPartners, the global business-advisory firm.

The report includes a survey of 4,600 diners from nine industrialized countries -- Brazil, China, France, Germany, Italy, Japan, South Korea, the United Kingdom and the United States (where 515 diners were surveyed). In addition, AlixPartners canvassed more than 60 C-level executives from more than 40 different restaurant concepts based in the US with combined 2015 revenues in excess of $90 billion to get their thoughts about international restaurant development as well as global consumer issues.

Dining-out Frequency
The report finds that consumer intentions to dine-out in the next 12 months appear to be relatively high across all countries surveyed. For instance, 47% of diners in China and 40% of those in Brazil said they plan to dine out more often than in the previous 12 months. By comparison, only 15% of American surveyed said that, the lowest percentage of the nine countries. The survey also found that the restaurant segments internationally most likely to gain traffic in the next 12 months are fast casual (with 2.4 expected visits per month per diner in the next 12 months, vs. 2.3 in the prior 12), casual dining (2.3, vs. 2.2) and fine dining (1.3, vs. 1.1), as diners around the world appear to want to "trade up" from fast-food restaurants and meals from convenience stores and grocery stores.

Meanwhile, the survey results for just the U.S. show Americans estimate that visits to fast-food establishments for any type of meal will fall 13% in the next 12 months. Fueling that decline may be a reduction in breakfast occasions, as only 28% of US consumers said they favor fast food for breakfast, a traditional stronghold for that sector, while the remaining 72% said they prefer breakfast from full-service restaurants, fast-casual restaurants, grocery stores or convenience stores.

Per-meal Spending
Like the outlook for dining frequency, the outlook for per-meal spending in the survey is a mixed bag. Of note, the survey reveals what appears to be a barbell-like effect taking hold in dining today across the world. When asked to estimate their average spending per meal per person in in the next 12 months vs. the prior 12, the only increases were at the low end and the higher end of the spending spectrum -- $5-and-under meals and $30.01-$50 meals.

One big exception in terms of spending in the year ahead could be China. According to the survey, 56% of diners there expect to spend more per meal in the year ahead than in the preceding 12 months. That compares with 20% of Americans who said they plan to spend more -- and 24% who said they plan to spend less.

Sustainability / Health & Wellness
Sustainability was a popular topic around the world in the survey. For instance, 53% of diners in China said their choice of restaurants was influenced by sustainable and humane food ingredients and the same percentage said that about sustainable supply practices. In Brazil, the comparable numbers were an also-high 49% and 43%, respectively, while in South Korea, they were 43% and 39%. Interestingly, despite a strong sustainability and health-and-wellness movement in America, the numbers in the U.S. were among the lowest of the nine countries: 34% and 33%, respectively. This could be, says the study, a peek into some of the perhaps-unexpected challenges that await those with international expansion on their minds or it could be a harbinger of even greater sustainability challenges yet to come in the US -- or both.

Regarding health and wellness -- and of challenges, unexpected or otherwise -- the consumer survey found that attitudes toward salubrious menu options differ widely by country. For instance, 33% of Americans surveyed said "healthy" menu options are either "extremely" or "very" important when choosing where to dine out. By comparison, though, 48% and Chinese and 51% of Italians said that. At the other extreme, just 26% of Britons and 17% of Japanese said such options were that important.

"On-the-go" Dining / Delivery / Technology
Another trend shining through in the survey is consumers' growing interest, around the world, in dining while "on the go." On average, 23% of those surveyed said they plan to increase their frequency of carryout meals over the coming 12 months, with 52% of the Chinese saying that, 39% of the Brazilians and 26% of the Germans. The US, possibly the most saturated place in the world for drive-throughs and in-car multitasking, came in at 15%. Perhaps even more telling was that respondents internationally said that on average they expect that basically one of every four meals (23%) of any kind they eat in the coming 12 months to be either carryout from a restaurant or some other form of a "mobile meal," such as food from convenience stores or grocery stores.

Hand in hand with diners' growing interest in moveable feasting is their growing interest in technology, including what appears to be a strong focus on the ability to control both the ordering and payment processes. When asked to identify the top-three most-important technologies a restaurant today can have, 53% of respondents globally chose online ordering, the No. 1 vote-getter of the options offered. Digital menus (49%) were second and digital loyalty programs (48%) third, with mobile payments (44%) and mobile meal-ordering (42%) rounding out the top five. Among US respondents, the leader was digital loyalty programs, at 56%, followed by online ordering (53%) and digital menus (52%).

In addition to seeking value through loyalty programs, diners in the survey also showed that they're technologically savvy when it comes to seeking out pure deals on their meals. When asked how effective online discount services are at influencing their dining-out decisions, 20% said such services are "extremely" influential and 49% said "somewhat" influential. In addition, an average of 52% said they plan to look for more discounts in the year ahead; and notably, those in the two largest economies in the survey, the US and China, came in at well above that average, at 62% and 71%, respectively.

Eric Dzwonczyk, managing director at AlixPartners and co-head of the firm's restaurant and foodservice practice, said, "It's clear that technology is changing the way consumers interact with restaurants. Increasingly, it's critical for restaurant companies to provide online ordering, digital menus and the ability to control how and when the check gets paid. Digital loyalty programs can be tricky to manage profitably, but customers continue to look for deals. The prudent allocation of capital and resources to technology-based business initiatives will have a major impact on who wins and loses with consumers in both the US and globally."

Chains vs. Independents
Diners' attitudes toward restaurant chains in the survey differed markedly by region. Globally, only 19% of respondents said they prefer dining-out at chains vs. independent establishments; and only 14% of Americans and 9-11% of Europeans surveyed said they preferred chains. However, 41% of the South Koreans, 39% of the Chinese and 23% of the Japanese said they preferred chains over independents. Meanwhile, among American respondents, 53% said chains are "much" or "somewhat" better than independents at the use of technology, and 43% saying that about chains prices.

Kurt Schnaubelt, managing director at AlixPartners and co-head of the firm's restaurant and foodservice practice, said, "Value is never out of vogue and customers are more demanding than ever. They require excellent food quality, friendly and fast service, and reasonable prices -- preferably with a discount or deal. In addition, consumers in many regions of the world prefer independents over chains, further ramping up the competitive pressures. Only with the right mix of attention to pricing, cost control and service will chains be able to maintain profit margins."

C-suite Interviews
As part of the study, AlixPartners also canvassed more than 60 C-suite industry executives to gauge their thoughts on international restaurant development and consumer trends worldwide. In line with the potential opportunities globally uncovered in AlixPartners' consumer survey, 79% of the executives indicated that international growth is currently among their top-three priorities, with 50% of that number saying they're currently exploring three or more international markets. When asked how they plan to enter these new markets, 52% said via franchise, 26% said via joint-venture partners, 13% said through company-owned sites and 9% said a combination of those. However, many of the executives pointed to a dearth of qualified partners, especially in terms of in-country and real-estate expertise, in many markets.

AlixPartners' Global Growth Outlook
Taking all these factors into account, the study includes a proprietary analysis by AlixPartners that looks at potential growth markets around the world. According to the analysis, while the US is a highly lucrative, $782 billion market, countries like China (still a $480 billion market, though China's growth has slowed a bit of late) may be the growth engines of tomorrow. It also points out that other countries in Asia and ones in the Middle East could be very attractive for international development too, including for US brands looking to expand internationally.

Adam Werner, managing director at AlixPartners and co-head of the firm's restaurant and foodservice practice, said, "From the continuing high-low bifurcation of consumer spending to the growing demand for on-the-go meals to the mounting demands for sustainability in all its forms to the pressing need to find growth wherever possible including internationally, perhaps the No. 1 common denominator in all is having a robust, efficient supply chain. In the past, having great visibility into your supply chain was important. In today's complex and fast-changing world, it's mandatory."

About the Study
The AlixPartners report includes a consumer survey conducted in July 2016 comprising 4,600 adults across nine countries (Brazil, China, France, Germany, Italy, Japan, South Korea, the United Kingdom and the United States), ages 18 or over. Survey topics focused on consumers' current and planned frequency of dining occasions across the restaurant, convenience-store and ready-to-eat categories; expected spending on meals outside the home; preferred types of restaurants; and key criteria for restaurant selection. It also asked participants for their opinions on selective topics including health and wellness, marketing/loyalty tactics, technology and pricing. In addition, more than 60 C-suite executives from more than 40 different concepts in the US with 2015 revenues in excess of $90 billion were interviewed to gauge their thoughts on international restaurant development and consumer trends worldwide.

About AlixPartners
In today's fast paced global market timing is everything. You want to protect, grow or transform your business. To meet these challenges we offer clients small teams of highly qualified experts with profound sector and operational insight. Our clients include corporate boards and management, law firms, investment banks, investors and others who appreciate the candor, dedication, and transformative expertise of our teams. We will ensure insight drives action at that exact moment that is critical for success. When it really matters. alixpartners.com

More Stories By Marketwired .

Copyright © 2009 Marketwired. All rights reserved. All the news releases provided by Marketwired are copyrighted. Any forms of copying other than an individual user's personal reference without express written permission is prohibited. Further distribution of these materials is strictly forbidden, including but not limited to, posting, emailing, faxing, archiving in a public database, redistributing via a computer network or in a printed form.

Latest Stories
SYS-CON Events announced today that Progress, a global leader in application development, has been named “Bronze Sponsor” of SYS-CON's 20th International Cloud Expo®, which will take place on June 6-8, 2017, at the Javits Center in New York City, NY. Enterprises today are rapidly adopting the cloud, while continuing to retain business-critical/sensitive data inside the firewall. This is creating two separate data silos – one inside the firewall and the other outside the firewall. Cloud ISVs oft...
As cloud adoption continues to transform business, today's global enterprises are challenged with managing a growing amount of information living outside of the data center. The rapid adoption of IoT and increasingly mobile workforce are exacerbating the problem. Ensuring secure data sharing and efficient backup poses capacity and bandwidth considerations as well as policy and regulatory compliance issues.
Internet of @ThingsExpo, taking place October 31 - November 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA, is co-located with the 21st International Cloud Expo and will feature technical sessions from a rock star conference faculty and the leading industry players in the world. @ThingsExpo Silicon Valley Call for Papers is now open.
The 21st International Cloud Expo has announced that its Call for Papers is open. Cloud Expo, to be held October 31 - November 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA, brings together Cloud Computing, Big Data, Internet of Things, DevOps, Digital Transformation, Machine Learning and WebRTC to one location. With cloud computing driving a higher percentage of enterprise IT budgets every year, it becomes increasingly important to plant your flag in this fast-expanding busin...
SYS-CON Events announced today that Interoute has been named “Bronze Sponsor” of SYS-CON's 20th International Cloud Expo®, which will take place on June 6-8, 2017, at the Javits Center in New York City, NY. Interoute is the owner operator of Europe's largest network and a global cloud services platform, which encompasses over 70,000 km of lit fiber, 15 data centers, 17 virtual data centers and 33 colocation centers, with connections to 195 additional partner data centers. Our full-service Unifie...
SYS-CON Events announced today that Twistlock, the leading provider of cloud container security solutions, will exhibit at SYS-CON's 20th International Cloud Expo®, which will take place on June 6-8, 2017, at the Javits Center in New York City, NY. Twistlock is the industry's first enterprise security suite for container security. Twistlock's technology addresses risks on the host and within the application of the container, enabling enterprises to consistently enforce security policies, monitor...
Interested in leveling up on your Cloud Foundry skills? Join IBM for Cloud Foundry Days on June 7 at Cloud Expo New York at the Javits Center in New York City. Cloud Foundry Days is a free half day educational conference and networking event. Come find out why Cloud Foundry is the industry's fastest-growing and most adopted cloud application platform.
For financial firms, the cloud is going to increasingly become a crucial part of dealing with customers over the next five years and beyond, particularly with the growing use and acceptance of virtual currencies. There are new data storage paradigms on the horizon that will deliver secure solutions for storing and moving sensitive financial data around the world without touching terrestrial networks. In his session at 20th Cloud Expo, Cliff Beek, President of Cloud Constellation Corporation, w...
In his session at 20th Cloud Expo, Brad Winett, Senior Technologist for DDN Storage, will present several current, end-user environments that are using object storage at scale for cloud deployments including private cloud and cloud providers. Details on the top considerations of features and functions for selecting object storage will be included. Brad will also touch on recent developments in tiering technologies that deliver single solution and an end-user view of data across files and objects...
IBM helps FinTechs and financial services companies build and monetize cognitive-enabled financial services apps quickly and at scale. Hosted on IBM Bluemix, IBM’s platform builds in customer insights, regulatory compliance analytics and security to help reduce development time and testing. In his session at 20th Cloud Expo, Tom Eck, Industry Platforms CTO at IBM Cloud, will discuss how these tools simplify the time-consuming tasks of selection, mapping and data integration, allowing developers ...
DevOps is often described as a combination of technology and culture. Without both, DevOps isn't complete. However, applying the culture to outdated technology is a recipe for disaster; as response times grow and connections between teams are delayed by technology, the culture will die. A Nutanix Enterprise Cloud has many benefits that provide the needed base for a true DevOps paradigm.
SYS-CON Events announced today that Progress, a global leader in application development, has been named “Bronze Sponsor” of SYS-CON's 20th International Cloud Expo®, which will take place on June 6-8, 2017, at the Javits Center in New York City, NY. Enterprises today are rapidly adopting the cloud, while continuing to retain business-critical/sensitive data inside the firewall. This is creating two separate data silos – one inside the firewall and the other outside the firewall. Cloud ISVs ofte...
Existing Big Data solutions are mainly focused on the discovery and analysis of data. The solutions are scalable and highly available but tedious when swapping in and swapping out occurs in disarray and thrashing takes place. The resolution for thrashing through machine learning algorithms and support nomenclature is through simple techniques. Organizations that have been collecting large customer data are increasingly seeing the need to use the data for swapping in and out and thrashing occurs ...
SYS-CON Events announced today that Outscale, a global pure play Infrastructure as a Service provider and strategic partner of Dassault Systèmes, will exhibit at SYS-CON's 20th International Cloud Expo®, which will take place on June 6-8, 2017, at the Javits Center in New York City, NY. Founded in 2010, Outscale simplifies infrastructure complexities and boosts the business agility of its customers. Outscale delivers a secure, reliable and industrial strength solution for its customers, which in...
Cloud applications are seeing a deluge of requests to support the exploding advanced analytics market. “Open analytics” is the emerging strategy to deliver that data through an open data access layer, in the cloud, to be directly consumed by external analytics tools and popular programming languages. An increasing number of data engineers and data scientists use a variety of platforms and advanced analytics languages such as SAS, R, Python and Java, as well as frameworks such as Hadoop and Spark...