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More than just a snack: Meal deals boost ‘lunch on the go' UK sales

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Gill Hyslop

By Gill Hyslop+

02-Aug-2017

UK shoppers may want convenience when it comes to a lunch-time snack, but they want more than just a sandwich. Pic: ©iStock/TAGSTOCK1
UK shoppers may want convenience when it comes to a lunch-time snack, but they want more than just a sandwich. Pic: ©iStock/TAGSTOCK1

UK convenience retailers capitalizing on meal deals have given the category a £36m ($47.6m) boost in the 52 weeks ended March 25, but those reliant on just snacks and sandwiches are missing out, says IRI.

According to IRI, food-to-go is one of the fastest growing convenience categories and forward-thinking retailers are experimenting with meal deal promotions to make the most of its growth.

The market researcher used its Convenience Market Place solution to analyze the performance of supermarkets and convenience retailers across the UK.

It found that retailers are capitalizing on the British shopper’s culture for convenience by expanding ranges to include more innovative offerings than just the lunch-time sandwich.

The category grew by 5% (value sales of £865m - $1.14bn) in the past year and is now worth around $2.3bn ($3.04bn) in the UK.

Growth ‘to-go’

Last year, more than 1.4 billion meal deals were sold, meaning that, on average, every person buys 20 food-to-go meals a year. 

According to Martin Wood, head of strategic retail insights at IRI, prepared food is a way of life for most time-poor shoppers today who have adopted a ‘buy-it-when-I-need-it’ approach.

More importantly, there are more choices available – such as sushi and salads – so people don’t need to compromise their health, he added.

Sandwiches, sushi, salads and snacks grew 6.6% in high street multiples for the year,improving revenues by £36m ($47.6m) for stores like Co-Op, Tesco Express, Little Waitrose and Sainsbury’s Local.

Data showed that main store supermarkets dominated food to go sales of £1.45bn ($1.92bn), while convenience retailers traded around £900m ($1.18bn) in the past year.

The mighty sandwich

Pic: ©iStock/Highwaystarz_Photography

Sandwich sales grew by 3.8% to £1.4bn ($1.85bn), accounting for the biggest volume sales.

However, higher priced items like baguettes, salads and sushi are showing faster growth. Salads, for example grew 5.1% to £800m ($1.05bn), while sales of sushi grew by 12% to £100m ($132m).

Wood added that some meal deals add a drink along with a snack at a price that often works out a lot cheaper than all of the component parts.

“This is encouraging people to buy their breakfast, lunch or ‘anytime meal’ on the way to work or home, boosting sales across not just the food to go category but also snacks and beverages, too.” 

IRI data showed that single-serve salted snacks rose 0.4% to £0.7bn ($0.93bn), while single-serve soft drinks rose by 3.3% in sales to just over £3bn ($3.97bn).

Don’t put all your eggs in one basket

Conversely, independent convenience retailers – including groups like Budgens, Londis, Spar, Costcutter and Nisa – that are more dependent on selling sandwiches have shown a much slower growth in food to go category.

While all convenience retailers grew value sales of food-to-go by 5% in the past year, this was driven by the high street retailers with growth of 6.6% to £584m and petrol forecourts and travel outlets up 2.9% to £185m.

Independent convenience retailers showed a decline of 0.4% to £96m, said IRI.

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