The at - and away-from-home food market is forecast to grow 8% in 2022

CHICAGO – Aug. 23, 2022 — While inflation is more moderate for food away-from-home (7.6% versus a year ago*) compared to food-at-home (13.1% versus a year ago*), the typical away-from-home eating occasion still costs 3.4 times more than in-home food sourced from retail. To offset rising food costs, consumers are bargain hunting when grocery shopping, eating more meals at home and cutting back on restaurant visits, reports Information Resources, Inc. (IRI®) and The NPD Group (NPD), which recently merged to create a leading global technology, analytics and data provider.

The nearly $1.5 trillion at- and away-from-home food market is forecast to grow around 8% in 2022, with at-home food (8.7% sales growth versus a year ago) outpacing away-from-home (6% versus a year ago), according to IRI’s and NPD’s inaugural joint research. The research offers the first-ever comprehensive view of the Complete Food™ market, examining how consumers buy and consume food at home, use restaurants and foodservice outlets and uncovers new insights about consumers’ trade-offs to save money and splurge in the current inflationary environment. The research forecasts the Complete Food market to grow by 3-5% in 2023.

Other key findings from the IRI-NPD research identify what is driving shifts, how occasions at home are evolving, and the impact of rising inflation, including:

1. Hybrid and flexible work schedules enable up to 20 million U.S. workers to work from home, which keeps the substantial majority – 62.5% – of the food dollar based on retail at-home sales, while 37.5% represents foodservice spending.

2. Consumers are bargain hunting, preferring more mainstream and value brands over premium brands, choosing private label foods in select categories and occasionally buying premium products as affordable luxuries.

3. Consumers are migrating to more at-home food to offset rising costs, as noted by the deceleration in foodservice traffic, down 3% in July. Even when dining out, consumers trade down to more value foodservice outlets, like quick service restaurants, as evidenced by the growth in average customer check versus menu prices.

4. Market bifurcation intensifies as higher-income households prefer premium products and lower-income shoppers prefer mainstream and value products. More growth is driven by higher-income households, as lower-income households are more economically challenged.

“With inflation hitting 8.5% in July, it’s no surprise that consumers are trading down to lower-priced options and opting for more value, especially when dining out,” said Dr. Krishnakumar (KK) Davey, president of CPG and Retail Thought Leadership for IRI and NPD. “While the pandemic and recent inflationary pressures shifted demand, restaurants and foodservice outlets offering value, convenience and at-home indulgence are top of mind for consumers and will continue to grow.”

“Even with the impact of elevated grocery prices, dining out is still much more expensive than eating at home,” said David Portalatin, senior vice president and industry advisor for Food and Foodservice for The NPD Group. “As we head into 2023, restaurant recovery will be slow and steady, as traffic begins to return to pre-pandemic levels. Current demand suggests that culinary trends are shifting to incorporate more bold flavors inspired by global and regional influences.”

The IRI-NPD inaugural joint research merges IRI’s retail point-of-sale data on what consumers purchase and where they shop with NPD’s continuous following of at- and away-from-home eating behaviors.

*U.S. Bureau of Labor Statistics, Consumer Price Index, July 2022