The food service industry is poised for robust and consistent growth in the upcoming years, as revenue is projected to surge from $2.65 trillion in 2023 to $5.42 trillion in 2030. Nevertheless, beneath these promising numbers lie significant hurdles for restaurant owners. Food service players must confront technological advancements, evolving consumer tastes, escalating expenses, and labor shortages. Failure to address these challenges could spell trouble.
To gain insights into the food service market’s transformations, let’s delve into industry trends, the obstacles it encounters, and the current state of artificial intelligence (AI).
Quick service restaurants
Among all the industry trends, quick service restaurants (QSRs) stand out as one of the most impactful. Once synonymous with fast food and perceived to prioritize speed over quality, today they seamlessly combine speed, convenience, and value with an ever-increasing emphasis on quality. This shift is driving the European QSR market to project growth from $148.9 billion in 2023 to $192.4 billion in 2030. Their alignment with the fast-paced, convenience-driven lifestyles of modern consumers not only reshapes the QSR image but also substantially expands their market share.
Technology has seamlessly woven itself into the very fabric of the food service industry, revolutionizing a traditionally labor-intensive sector. An expanding array of tools within the restaurant tech ecosystem offers companies a diverse set of resources. Real-time digital inventory management systems now curtail waste and ensure ingredient freshness. Advanced data analytics empower businesses with insights that were unimaginable just a decade ago, enabling them to discern popular dishes at different times of the day and adjust menus efficiently, thereby enhancing supply chain management. This fusion of food and technology opens the door to a transformation in business operations, ushering in new customer expectations.
The rise in online ordering, whether through a restaurant’s website or third-party platforms, has made businesses more accessible to customers. Since the pandemic, online ordering has surged by 65 percent. Research indicates that by 2030, food delivery will rank as the second most preferred option for customers, making the adoption of these new technologies imperative. Thankfully, a staggering 94 percent of people in the UK own smartphones, offering a resource-efficient means for businesses to adapt. Smartphone apps not only expedite payments but also support advance table reservations and direct food delivery to homes. As app development progresses, features like loyalty programs and personalized recommendations could soon become commonplace.
However, the sector faces a notable challenge with the emergence of labor shortages. The pandemic prompted many workers to exit the industry, leaving restaurateurs grappling to rebuild their teams. In response, businesses are reevaluating their staffing models, prioritizing cross-training to ensure seamless operations even in the absence of specific roles.
To address staffing limitations, some are also implementing the technologies mentioned earlier, especially for order tracking and table reservations, albeit with associated risks. Safeguarding against cybersecurity threats and data breaches comes at a cost, though the potential damage to reputation from leaked customer information would be far more severe.
AI has driven substantial progress across various domains, including the food service industry. However, it’s essential to recognize that AI hasn’t yet delivered definitive initiatives. While it’s inevitable that AI will play a pivotal role in the future, current solutions, such as customer purchase recommendations based on history, remain relatively straightforward. At this point, the most significant impact comes from other technological advancements.
Technology and evolving consumer preferences will actively mold the food service sector in the years ahead. To maintain competitiveness, businesses must wholeheartedly embrace these trends and challenges, harnessing the arsenal of new tools at their disposal. Achieving success demands striking a harmonious balance between time-honored practices and cutting-edge innovations, all while cultivating adaptability and forward-thinking strategies. As we step into this new dining era, businesses must remain keenly attuned and receptive to change, enabling them to flourish in the dynamic and perpetually evolving food service industry.
For a list of the sources used in this article, please contact the editor.
Ferdinand Fico is International Go to Market Manager Retail & Food, Merchant Services at Worldline. His robust 14-year career spans complex project management, consulting and international development within the banking and insurance retail sector. As an expert in orchestrating human and digital transformations within organizations, Ferdinand leverages his comprehensive experience to enhance business outcomes in today’s rapidly evolving landscape.