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How food-to-go is building new momentum in UK retail

Updated: Dec 16, 2020

Despite the various covid related challenges across the UK over recent months, a variety of recent developments across the retail side of the food-to-go sector give new reasons for optimism. We summarise some of the key developments here.



1. Sainsbury's latest formats are deepening its food-to-go focus.


Sainsbury's has just opened its latest food-to-go concept, at Hempstead Valley in Kent. It's part of a broader store development, at what looks set to be a new safari destination (M&S has one of its latest food concept stores close by). An updated fresh section is the key driver of the new look store, feeding into upgrades across the café, patisserie and bakery as well as the food-to-go section, which includes a burger, rotisserie chicken and pizza offer. The retailer has also launched a new mid size neighbourhood hub format over recent weeks, in two locations in the South of England - Bishop's Waltham (Hampshire) and Midhurst (West Sussex). Described as "a food-led extension of Sainsbury’s renowned convenience offer", the stores' size and location enables them to serve "longer missions". Food-to-go is also covered in the offer, including coffee on the go and freshly squeezed orange juice.

Why its important? Sainsbury's recently updated its strategy to focus on a food-first proposition. At this current time, it's hard to imagine a proposition in this space that doesn't include food-to-go. Indeed these moves form part of a continuing flow of initiatives from Sainsbury's over the past two years, including new formats, partnerships and product ranges.


What's next? This appears set to accelerate in the next 12 months. And Sainsbury's may well develop how it works with food-to-go focused partners. It already works with Sushi Gourmet, Crussh, and - albeit in the core grocery aisles - Leon, while it's also just announced it will extend its collaboration with Patisserie Valerie to 250 stores.


2. Co-op's Ever Ground bean to cup coffee will shake up the market in coffee to go.


It might seem odd to be calling out one product, available in just a handful of stores right now, as a key development. But there are two key reasons why we see Co-op's launch of a bean to cup coffee brand as standout. Firstly, it's focused on a key strategic food-to-go beacon product. And secondly it's from a retailer that has shown over recent years that it is very serious about expanding and developing in the food-to-go space, and built a strong reputation in food-to-go off the back of it.


The principles behind a strong coffee to go offer, including fair trade credentials and affordable quality, are a good fit with where Co-op is right now. And while there's always a chance that it won't find a fit with customers, we believe it is well placed to do so, providing the brand development is seen as a continuing project and an evolution, rather than a one-off project. the coffee offer will be in nine stores, four of which are in and around Manchester, but also including stores in Sheffield, Huddersfield, York, Wolverhampton and Glasgow, by the end of next week


The ethos of the sub brand appears strong. And there's a great role model to follow from across the Irish Sea. Musgrave's Frank & Honest brand, developed in-house, has become a core pillar of its food-to-go offer, both in Centra convenience stores and in SuperValu supermarkets, whether it be via a bean to cup or in its barista-led solution. It's even moving into standalone coffee shop locations.



Why its important? Costa Express has become the common currency for coffee in UK food retail stores over recent years. And for many retailers, it delivers well. However, it's very hard for any ubiquitous product to be the optimal solution, as it's no longer a differentiator. So it's really interesting to see a retailer look to stamp its own footprint in this space.


What's next? We very much doubt that Co-op will be the last to look to do this. And we expect Costa to continue to upgrade and develop its own offer. One thing that is clear is the continuing appetite for coffee, and the more the UK consumer is on the move, the bigger the opportunity, despite the growing competition across the market. .


3. Morrisons Market Kitchen is taking supermarket food-to-go to new heights.

This is a benchmark opening for food-to-go in UK food retail, with the new look Market Kitchen concept launched into a supermarket for the first time. Take a look at our 2 minute video of the concept here and read our detailed report here.


Why its important? This is a radically different food-to-go concept, with a desire to embody core foodservice principles to create a standout concept vs. what we've previously seen in UK food retail. It's a service led model, which we've seen work very well in a variety of markets globally, but it's one that UK retailers have been cautious of. Market Kitchen changes that, so it's a significant step forward, expanding the range of food to go solutions that can be delivered in-store significantly, and also giving a strong evening offer, in-store and via Deliveroo.


What's next? Further developments are already under way, and in particular we are keen to see how adding a seating area to the Market Kitchen concept can accelerate the ceiling for this impressive operation. Expect others to consider how they can create elements of the proposition in their own stores. And indeed they've already started - for example Asda is rolling out Yo! brands Panku and - at a smaller scale - Kulaba Kitchen.


4. Convenience retailers across the board are accelerating food-to-go development.

The UK convenience store market encompasses a wide range of different formats, with radically different origins, ownership structures and positioning. But across the board there's a growing interest in targeting food-to-go more strongly, not least as some operators see new customers and missions derived from the suburban buoyancy at the current time due to covid.


And we're seeing retailers push into new solutions as they accelerate their focus - witness the food-to-go counter installation at this latest Nisa store in Stamford, Lincolnshire. Also in recent weeks two SPAR wholesalers have unveiled renewed and expanded focus on food-to-go - in the form of CJ Lang, developing its CJ's food-to-go proposition, and AF Blakemore, as it launches new food-to-go products and tests new concepts, for example in pizza to go. This sits alongside considerable activity on forecourts, which we'll cover in a subsequent blog.


Why its important? On first sight, and compared with the Irish market, the development looks modest. However, from the perspective of where many UK convenience retailers have come from, it has the potential to be transformational.


What's next? It's still early days, but the market opportunity for counter-served food-to-go in convenience in the UK is undoubtedly expanding. The strengthening footfall around neighbourhood locations also increases the potential for different sites that might otherwise have been reluctant to commit financially to go after the food-to-go opportunity. Winners will emerge over the next 12 months who embrace the opportunity, and the current wave of sentiment towards supporting local and community businesses should be embraced as a catalyst to realising this. And even while counter served food-to-go often won't be the answer, at least right now, there's an opportunity for suppliers to support retailers in taking their food-to-go offer to the next level, whatever that level may be.


So what does this mean for the UK landscape?


At its annual results presentation, Greencore CEO Patrick Coveney put the downturn in food-tot--go down to one single factor: covid. That doesn't mean he's expecting a direct return to type as covid subsides in importance, but he does see ample opportunity, even if the locational balance - and potentially some of the optimal price points - of the opportunities may have shifted.


Which provides grounds for optimism, even if the short term still feels painful for many. One observation from the Greencore presentation was the direct link between transit levels across the population and food-to-go volumes. Transit levels will continue to rise over 2021, albeit not necessarily to 2019 levels, but this in itself will create opportunities. The key right now is to take a good look at core operations and ensure the proposition is optimised and relevant as the market - albeit gradually - rebounds.


How can you learn more about the opportunities?


We'll be taking a broader look at the future opportunities for food-to-go in retail at our forthcoming webinar with Martin Gaber from JosDeVries on Wednesday 9 November. More details and sign up here.


Food-to-go in Focus is a new service from Food Futures Insights, designed to keep you up to speed with the expanding role and opportunity for food-to-go in retail by sharing the latest format developments and trends across Europe. Get in touch with gavin@foodfuturesinsights.com to find out more about how you can get access.


Images sourced from: Sainsbury's, Co-op and Food Futures Insights.

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