The UK foodservice delivery market is expected to reach a total value of £14.4 billion in 2023, according to Lumina Intelligence’s recently released Foodservice Delivery Report 2023. The market is projected to grow by +7.8% in 2023, driven by wide-reaching investment in delivery services, including the development of aggregator platforms, optimization of brand sites and prominent marketing activity.
Whilst high inflation and increases in fees will contribute to the market’s growth, the report highlights that volumes may suffer as cost-conscious consumers reduce market penetration and frequency in 2023. In fact, 57% of those not ordering delivery are doing so to save money. As such, value scrutiny is a crucial consideration in 2023, and delivery operators must prioritize value messaging, reward schemes, and subscription models to attract and retain cost-conscious consumers.
The report also indicates that most market channels are continuing to grow share as the market matures and becomes more segmented. Channels including restaurants, fast food, coffee shops/sandwiches, bakeries and pubs are seeing delivery command a higher share of revenue as availability increases and demand endures.
Moreover, the report highlights that wider availability on the supply side has been met with increased consumer demand, as dinner now accounts for less than two in three delivery occasions. Breakfast, lunch, and drink-only occasions increase share year-on-year, with coffee emerging as a key opportunity. With a wider variety of delivery players contributing to growth at different day-parts, the market’s future growth will hinge on consumers moving away from treat-led ordering to habitual spending.
Consistent growth at a CAGR of +5.3% from 2023 to 2026 is forecast to see the market reach a total value of £17.0 billion in 2026. The report suggests that the market is expected to continue its pre-pandemic trend of total eating out market share growth, as operators continue to invest in delivery propositions as a revenue stream. Further technological advancements will provide increased efficiencies for aggregators and operators alike, with current efficiencies including stacking.
“The UK foodservice delivery market is set to reach £14.4 billion in 2023, driven by wide-reaching investment in delivery services, but delivery operators must prioritize value messaging, reward schemes, and subscription models to maintain growth and attract cost-conscious consumers,” commented Senior Insight Manager Katherine Prowse.