Consumer Foodservice in Belgium

Abstract

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• Get insight into trends in market performance
• Pinpoint growth sectors and identify factors driving change
• Identify market and brand leaders and understand the competitive environment

Product coverage

Consumer foodservice by chained/independent; Consumer foodservice by type; Consumer foodservice by type and chained/independent

Executive summary

Mixed results mainly due to structural crisis

Consumer foodservice is exhibiting worrying signs according to some sources. Trade associations deplore constraints such as the lack of profitability in the industry, the unfair legislation on smoking and the competition from leisure and home consumption. Major players also pinpoint the high black market share in the industry, the overwhelming share of independent full-service restaurants (FSR) and cafés/bars and the relatively weak presence of international concepts. However, the ongoing progression of the market' s current value sales and the stability of the number of its outlets contrast with the sluggish performance of the market in the middle of the review period. The success of local chains in fast casual dining or bakery fast food is also evident.

Fast food the most dynamic concept

In an industry that is increasingly driven by convenience, fast food is logically the most dynamic sector in terms of actual progression. Given it also matches the demand for natural flavours and the local tradition of tartines (local half-side sandwiches), bakery fast food is one of the main contributors to the overall growth of consumer foodservice. In such outlets, sandwiches, salads, baked goods and hot snacks are perceived as healthier than burgers. Nevertheless, burger fast food has enjoyed a better performance in recent years thanks to the recovery of McDonald' s and Quick and the transformation of many street stalls/kiosks into independent burger fast food outlets.

Full-service restaurants and cafés/bars dominate

Full-service restaurants and cafés/bars are the most established but also the most mature formats. Despite a temporary stability due to the ongoing authorisation to smoke in most outlets, cafés/bars continue to suffer from declining traffic given the disaffection for alcoholic drinks in the on-trade. While costs rose more than sales, too many independent outlets have sprung up in FSR over the review period, due to new entrants or the switch of cafés/bars to FSR. Other than Italian restaurants and some niches, ethnic food is not a major trend in the country. Even so, some concepts such as modern bistros and lounge restaurants successfully mix traditional Franco-Belgian cuisine with original and exotic touches.

Travel outlets and 100% home delivery/takeaway satisfy demand for more convenience

Travel and 100% home delivery/takeaway outlets are benefiting from increasingly hectic lifestyles and growth in travel, notably growing traffic at airports and railway stations, which are also benefiting from more numerous outlets. Takeaway sales are also expanding more strongly than eat-in, mainly in full-service restaurants and fast food to meet the demand for on-the-go consumption.

Local concepts lead the way in minority chained outlets

Many factors contributed to the underdeveloped presence of chains and particularly foreign companies in Belgium, including the small size of the industry, the Belgian loyalty to local culinary traditions and the failure of some previous endeavours. Burger fast food franchising concepts are not so much in evidence in the country while US-style specialist coffee shops failed to emerge. Independent outlets largely characterise consumer foodservice. Nonetheless, some local concepts managed to take off during the review period such as Panos in bakery fast food and Exki and Le Pain Quotidien in fast casual dining.

Ambivalent results in the coming years

Given the mixed results of the industry in 2005/6, the ambivalent impact of the ban on smoking and the uncertain results of the negotiation on VAT, opinions differ as to the projected fortunes for consumer foodservice in coming years. The slight improvement in the economy and the growing need to eat out-of-home should fuel the number of transactions in fast food and to a lesser extent in 100% home delivery/takeaway and some trendy FSR and fast casual dining outlets. Nonetheless, the surplus of cafés/bars, the lack of profitability and modern equipment and competition from the cocooning trend are serious threats to the industry.