The fast food market has seen a boom since the Global Financial Crisis (GFC) of 2008 thanks to a continuing uncertain economic climate, with Aussies trading down to consume fast food servings in the billions in the past 12 months.
According to BIS Foodservice’s Fast Food 2013 Report Series, the eaters of the quick-service bite are more likely to be mid to high income earning women.
The report also found that there has been a marked change in consumer behaviour which is in stark contrast to the perception that Australian consumers value and support their independent outlets.
“It has been a bonanza in the fast food market since the GFC,” said Sissel Rosengren, head of BIS Foodservice.
“Not to denigrate the quality of fast food in Australia, which includes everything from a drive through hamburger to a chicken wrap and prepared meals such as soup, but there is a noticeable ‘trade down’ effect that occurs in any economic downturn.
“As a result, fast food chains are on the increase and are now the dominant force in the fast food market for the first time in Australia’s history, which goes against the notion that we are a country that loves its independents.”
However, the report series warns the boom in fast food may be over, with signs emerging that the market is on the decline as the industry deals with tighter customer budgets and belts.
Fast food trends – who’s eating it and why
The study, which defines the fast food market as fast food chains, fast food independents and snack food chains, found Australians spent $15 billion on fast food in the past 12 months.
Of that, around $11 billion was made up of food itself, while another $4 billion was spent on the beverages.
The report – which surveyed more than 1200 people aged 14+ on their personal eating habits – found that women are the biggest fast food eaters, making up 56 per cent of the market in terms of all fast food eaten.
“Many might assume women are buying fast food for others, but what this report shows is that women are actually more likely to eat fast food than men,” said Rosengren.
“The assumption is that men are typically the fast food eaters, given the marketing by fast food chains usually focuses on blokes relaxing at the beach in their ute with a chicken burger or eating a pizza while watching the footy. But women are the biggest fast food eaters across all fast food categories, by a healthy majority.”
Another common misconception is that fast food is the “food of the working class”, generally reserved for lower income workers who can’t afford a slower-cooked restaurant meal.
“That couldn’t be further from the truth,” said Rosengren.
Of the total fast food market, 35 per cent of fast food eaters earn between $50,001 and $100,000, while those earning $50,000 or less make up 30 per cent – although 15 per cent of respondents preferred not to say what they earned.
“You are just as likely to see someone in an office job eating a hamburger and chips as you are someone who is only eating fast food because it is the cheaper option,” said Rosengren.
“What this suggests is that there has been a noticeable trade down effect in the total foodservice market in the last five years.”
Independent fast food outlets – which include outlets such as Chinese takeaways, fish and chips shops, and pizza outlets – have struggled during the GFC, dropping from 8,969 stores across Australia in 2005 to 8,498 stores in 2009.
While their numbers are beginning to recover, increasing over the past two years, they are still short of the pre-GFC totals.
This is in stark contrast to the rise of fast food chains which have increased in outlet numbers on average by 5.3 per cent annually over the same period, while Snack Food Chains have increased by a whopping 10.8 per cent on average per annum in this period.
Further, the report found that fast food and snack chains now outnumber independent fast food outlets for the first time in the country’s history.
“This is the first time in Australian history that chains now dominate the landscape in any sub-sector of the foodservice market.”
Despite the boom since 2008, the foodservice market as a whole – including restaurants, cafés and clubs among others – faces a challenging road in the next six to 12 months.
Consumer research contained within the report series found that there were much fewer visits to fast food restaurants in the past six months, with a net decrease of 41 per cent reported. But the forecast for the next six months is also grim, with consumers expected to decrease their visits by a further 26 per cent.
Rosengren said the drop could be due to a myriad of factors, including the obesity message starting to take effect. Regardless, with fast food chains during the GFC being the star performer in the foodservice market, the expected hard road ahead for that area of the market signals that the beacon of hope for the challenged industry has gone out.
“With fast food now expected to struggle in the next six to 12 months, the industry as a whole will struggle to keep its head above water,” said Rosengren.
