Cash-strapped families plan to cut back on eating out and takeaways in 2024 as the cost of living continues to squeeze household budgets – presenting a real challenge for the hospitality industry.
A survey of 1,000 consumers conducted on behalf of RSM UK showed that almost 6 in 10 families (59%) will spend less on takeaways and delivery food next year, and over half (56%) will spend less on dining out.
Almost half (47%) of families plan to reduce their frequency of dining out and 31% will seek out discounts and special offers, showing that the demand is still there but spend will be down.
Robyn Duffy, senior analyst at RSM UK, comment: ‘The pace of inflation will continue to slow in 2024, but the knock-on impact of tighter monetary policy will come in sharp focus. This will have a particular impact on families, of which 90% say the impact of high interest rates will influence discretionary spending in 2024.
‘This is troubling for operators as families are a key customer segment, particularly those who are more affluent with household earnings of over £60K. These families will eat out in a restaurant twice as frequently (twice a month) than the average consumer in 2024, and rank high interest rates as the number one thing that will impact discretionary spending in the next 12 months.’
Paul Newman, head of leisure and hospitality at RSM UK, said: ‘Higher interest rates and inflationary pressure are colliding with the day-to-day demands on family budgets, and the fallout looks set to be cutbacks to takeaways and dining out.
‘Rather than a race to the bottom on prices or discounts, customer loyalty will be the key to success in 2024. We expect a spike in loyalty schemes as businesses look to reward frequent diners to drive footfall and capture a greater share of spend within an increasingly competitive market. The brands that get this right and harness loyalty will be the real winners next year.’