Forecast 2018: The Outlook on Foodservice

NATIONAL REPORT — Convenience store retailers show enthusiasm for the foodservice category, according to the 2018 Convenience Store News Forecast Study.

A whopping 77.4 percent of surveyed retailers expect their average per-store foodservice volume — which includes prepared food and hot, cold and frozen dispensed beverages — to increase in 2018, and a matching 78 percent predict their average foodservice dollar sales per store will also increase. Only 2.2 percent expect a volume decline and 4.3 percent expect a dollar sales decline.

The most repeated word when retailers discuss what will have the biggest impact on the foodservice category in 2018 is "healthy" — healthier products, healthier alternatives, and consumers' health-conscious eating habits. Higher food quality, new flavors and menu additions are also expected to play sizeable roles as consumers seek out new food experiences.

At the same time, retailers are clear that enhancing their foodservice programs means investing in more than the food itself. Today's consumers demand convenience on their terms, which c-store operators see as expanded grab-and-go options, an increased online presence (including delivery and loyalty programs), and quick trips in and out of the store.

"More people expect quick [service]," said one retailer. "They're not wanting to wait."

Some c-store operators have more tempered expectations for the category, noting that strong competition from freestanding fast-casual restaurants and other c-stores can cut into profits even as the market expands. Consumers may also be less willing to try food at a single store than they would at a larger, established chain, according to some respondents.

Overall, retailers expect to see foodservice category growth of 5.7 percent for volume and 6 percent for dollar sales this year.

The 16th annual CSNews Forecast Study includes a Retailer Forecast and Supplier Forecast, both based on the results of a survey fielded in November 2017. Participants were asked to predict 2018 sales per store for a variety of product categories, as well as to share their opinions on overall business, economic and consumer trends. The Forecast Study also provides dollar and unit volume projections in key c-store product categories based on data from various sources, including Nielsen for category sales history; TDLinx for store counts; and government sources for motor fuel volume and pricing data.

Come back tomorrow to CSNews.com for the 2018 Tobacco forecast.