Ready meals facing pressure from home delivery?

Brought to you by Retail Insider and K3 Retail

Restaurants and other foodservice companies are having a tough time handling the explosive growth now being experienced in home delivery. Increasingly impatient – and lazy – customers demanding instant gratification are fuelling the growth in food delivered to the home.

The amount of meals cooked in the home is falling among younger people who find it massively more convenient to order their meals from an app and have it delivered to them within the hour. This is putting some stress on restaurants as they find their margins squeezed when having to give over some of their profits to the likes of Deliveroo, Uber Eats and Amazon’s Restaurants delivery service.

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What does not seem to have been debated is the impact the increased numbers of delivered meals is having on the sales of ready meals in supermarkets. The decision to buy a supermarket branded ready meal, which needs to be heated alongside side dishes, or a well known restaurant branded meal that is then delivered to the home seems an easy choice if the pricing is not massively dissimilar and the convenience aspect has been factored in.

I have not seen any ready meal sales figures of late but the serious growth in home delivery must be having some impact on demand. And since it is the younger consumers who are driving the growth at Deliveroo, Uber Eats and also Just Eat the fact is supermarket ready meals must be facing a growing negative impact.

Also adding to the worries of the major grocers is the way people living in cities in the UK are moving towards that experienced in the US where kitchens are rarely used to cook any food at all and in some cases new developments are not even incorporating traditional kitchens into their floor plans.

Cookers are not guaranteed to have a place in some newer apartment blocks in the US and a similar scenario could be played out in certain developments within the UK. Certainly my experience in New York City is of cookers whose doors appear to have hardly ever been opened, never mind been put to good use.

Glynn Davis, editor of Retail Insider

K3 Retail deliver multi-channel solutions that enable retailers to create joined up shopping experiences for their customers whether they choose to buy on-line, direct, in-store or via mobile. It has over 20 years’ experience delivering award winning solutions, to more than 175 internationally recognised retail brands.

 

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