A growing number of consumers have figured out that they can get a good meal away from home and it doesn't have to be at a restaurant. According to research from The NPD Group, sales of prepared meals have risen by five percent in retail stores over the past two years compared to three percent for all foodservice.
Convenience stores were first among retailers in generating foodservice traffic. According to NPD, 54 percent of retail foodservice traffic went through stores in this channel. Number two were supermarkets with 32 percent of the traffic, followed by mass merchants (11 percent) and warehouse clubs (three percent).
In terms of rate of growth, foodservice traffic at convenience stores grew three percent over the past two years. Supermarkets (six percent) and mass merchants (11 percent) increased traffic at the quickest pace during the period ending May 2007.
"For years, supermarkets and convenience stores were outlets for packaged foods. But the growth of the restaurant industry during the past 25 years - and especially the growth of take-out meals - has shown everybody in the food market that consumers now want 'packaged meals,'" said Harry Balzer, vice president of The NPD Group, in a company press release.
The cost of buying prepared meals was predictably higher in restaurants than in retail outlets. According to an Associated Press report on the study, the average check at restaurants was $6.19 versus $3.12 for all retail and $2.99 in convenience stores.
The NPD study was based on a sample of more than 400,000 restaurant customers and nearly 77,300 people who shopped at retail stores.
Discussion Questions: How do you explain the rate of prepared meal growth in retail outlets over the past two years? What retailers do you believe have the most to teach others about doing foodservice right?