Foodservice Profile – United States

Macroeconomic and consumer profile

According to Euromonitor International, the United States (U.S) is poised to remain the largest global consumer market over the forecast period (2040), due to its substantial population, significant representation and concentration of affluent consumers and positive economic outlook (Euromonitor International; Income and Expenditure: the US, June 2023).

In 2022, the U.S economy grew 2.1% in annual real gross domestic product (GDP), attributed to elevated consumer spending (excess savings held), which accounted for approximately two thirds of the country's GDP. In 2023, economic development is anticipated to stabilize, with annual real GDP growing by 1.1% (+1.6% annual real GDP growth expected between 2023-2027) (Euromonitor International; PEST Analysis: The U.S).

Consumer income (average gross annual income) was US$99,807 in 2022, despite reported stagnation due primarily to high inflation and interest rates, while the forecast period (2022-2040) is projected to witness moderate growth (1.2%) in per capita income level (Euromonitor International; Income and Expenditure: the US, June 2023), particularly those consumers aged 65+, who are anticipated to remain predominant in the top income band (US$250,000+) by 2040 due to accumulated assets and multiple income sources Euromonitor International; The U.S Consumer Profile).

Consumer expenditure has been recently impacted by increasing energy and food prices and economic uncertainties incurred in part, from Russia's invasion of Ukraine, and remaining disruptions in global supply chains, which have hindered production and logistics recovery. Transportation, food and non-alcoholic beverages, and household goods and service prices specifically, have experienced the highest growth rates (Euromonitor International; Income and Expenditure: the US, June 2023). However, despite rising inflation and global economic uncertainties, the U.S is expected to remain the largest global consumer market in terms of total expenditure, as private consumption is expected to increase by 32.0% between 2022 and 2040 (Euromonitor International; The U.S Consumer Profile).

Increased life expectancy, urbanization, modest birth rates and consistent immigration (recent increase in visa issuance to adult immigrants, refugees and temporary foreign workers and continuing policy reforms ) are defining the consumer landscape within the U.S (Euromonitor International; The U.S Consumer Profile). In 2022, the U.S population was 333.3 million people with a median age of 38.9 years and by 2040, the population will increase to 360.5 million people with a median age of 42.4 years, while Generation Z (aged 30-45) will become the most prevalent consumer segment. Rapid urbanisation is expected to continue with 85.9% of the population expected to reside in urban dwellings by 2040.

The number of households in the U.S was 130 million in 2022. An ageing demographic, increasing divorce rates and lifestyle choice has lead to the growth in solo living/single-person-parent households. Childless families are also increasing and female-led households are projected to maintain their larger representation (primarily due to shifting social dynamics, increased opportunities and population aging), comprising 57.0% of all households by 2040. Average dwelling sizes and multigenerational households have also increased due to elevated living costs (Euromonitor International; The U.S Consumer Profile). In terms of geographic profiles, Sun Belt states like Texas and South Carolina are increasing in population guided by factors such as robust economies, attractive tax structures and affordable living, with significant foreign investments fueling job creation. Conversely, high living and property tax costs, compounded by the increase in remote work, have driven some residents away from some urban areas (Euromonitor International; The U.S Consumer Profile).

The wealthy and affluent consumer segment is expected to represent over three quarters of the country's total wealth in 2030, and the wealthiest 10.0% of households will account for over a quarter of 'inconspicuous consumption' (spending on health goods and medical services, education, leisure and recreation, or miscellaneous goods and services) by 2030, highlighting the concentrated nature of the country's luxury market (Euromonitor International; PEST Analysis: The U.S). Expanding income inequalities however, continue to position the lower-income class segment as the majority of total consumers, within the U.S market landscape (Euromonitor International; The U.S Consumer Profile).

As technological advancements strengthen, the U.S consumer will require accessible, transparent and verifiable product and brand information as the demand for specialized and tailored products continue. Younger generations in particular, will prefer specialized sources to cater to their diverse interests and will value speed and hyper-convenience in product delivery (Euromonitor International; The U.S Consumer Profile).

According to Consumer Values and Behaviour in the U.S, consumers prefer home-cooked food, but foodservice demand is strong as a lack of time is one of the biggest barriers to preparing and cooking food at home, with 14% of consumers reporting that eating at a restaurant is more convenient than cooking for themselves, while 20% report they intend to increase their visits to restaurants over the next year (Euromonitor International; May 2023). Further, Consumer Lifestyles in the U.S notes that 22% of consumers report that they regularly order food (weekly) for home delivery while 31% are regularly ordering food (weekly) for takeaway, or pick up ready-made food to eat at home (Euromonitor International; May 2023).

Consumer per capita expenditure on foodservice, food and beverages in the United States

Consumer per capita expenditure on foodservice was US$2,040 in 2022, increasing in compound annual growth rate (CAGR) by 3.2% from US$1,742 in 2017. Consumer per capita expenditure on food in the U.S was valued at US$2,992 in 2022, representing an increase in CAGR of 5.6% from US$2,279 in 2017. In comparison, consumer per capita expenditure on non-alcoholic beverages was US$390 in 2022, increasing in growth by 6.4% from $286 in 2017, while per capita expenditure on alcoholic beverages was greater, with values of US$590 in 2022, representing the largest increase in CAGR (7.4%) from US$413 in 2017.

In the forecast period, consumer per capita expenditure on food and non, and alcoholic beverages is expected to continue to experience positive increases in growth, albeit at the lower rates of 2.6%, 2.3% and 1.5% respectively, while consumer per capita expenditure on foodservice is anticipated to experience a larger increase in growth (4.5%), attaining US$2,542 by 2027.

The foodservice market

The U.S consumer foodservice industry initially experienced value declines from early government imposed pandemic restrictions related to on-premise dining, and increased inflation in 2022 however, consumer demand for restaurant dining and eating outside of the home increased as pandemic restrictions eased, especially for middle and upper-income consumers (Euromonitor International; Consumer Foodservice in the U.S, February 2023).

The consumer foodservice (food and beverage) market in the U.S was valued at US$680.2 billion in 2022, experiencing an increase in CAGR of 3.6% from US$568.8 billion in 2017, despite the recent decline in growth by 17.8% as foodservice sales decreased from US$604.4 billion in 2019 to US$496.8 billion in 2020 with the emergence of the pandemic. The foodservice market remains in the recovery phase post pandemic displaying promising growth of 21.4% evident in 2020 to 2021 as values sales increased from US$496.8 billion to US$603.2 billion. In the forecast period, both food and beverage will increase in growth however beverages will experience greater performance, attaining growth of 3.2% by 2027. Of note, retail sales of food products remain the dominant segment in market share representation within both the historic and forecast periods.

Foodservice provided through standalone locations has been the largest distribution channel throughout the historic period with most recent value sales of US$570.3 billion (83.9% market share) in 2022, representing an increase in CAGR of 3.8% from US$473.4 billion in 2017 (−10.2% from US$502.6 billion in 2019 to US$451.1 billion in 2020). Foodservice through travel attained value sales of US$14.6 billion (2.2% market share) in 2022 and experienced the largest increase in CAGR (5.7%) from US$11.1 billion in 2017 (−55.6% from US$12.5 billion in 2019 to US$5.6 billion in 2020), as recovery and the return to travel and tourism post pandemic, evolved (+82.5% from US$5.6 billion in 2020 to US$10.1 billion in 2021). Relatedly, Euromonitor International notes that the influx of return travelers (both international and domestic) to and within the U.S, has had a profound impact on the consumer foodservice industry in general. For example, full-service restaurants benefited from the return of business and international travellers, while fast-casual and family-oriented full-service restaurants enjoyed the return of road-trippers. Convenience and fuel station foodservice was also helped by the return to the office (and travel-related work) of many employees in 2022 (Euromonitor International; Consumer Foodservice by location in the U.S, February 2023).

In the forecast period, all foodservice channels are anticipated to experience positive growth increases. Foodservice through leisure channels is expected to attain the largest increase in CAGR (10.1%) as value sales are anticipated to reach US$11.6 billion by 2027 from US$7.1 billion in 2022, as this channel in particular, will serve to increase community engagement through the integration of organized sports and games with the consumer's dining experience. The Chicken N Pickle restaurant for example, features pickleball courts and a chicken-centered menu (Euromonitor International; Consumer Foodservice by location in the U.S, February 2023).

Foodservice through retail is also expected to experience moderate annual growth of 5.2% in the forecast period as the channel plans to redefine the relationship of retail and foodservice partnerships by expanding digital food halls (ghost kitchens) through select retail outlets, enabling the consumer to order food from several restaurants via their phone or in-store kiosks for pick-up at a convenient location. Relatedly, technological innovation that has emerged from the necessity to not gather, prompted improvements in apps and delivery platforms enabling the consumer to conveniently access a variety of foods from various new location outlets. Subway for example, launched a 'Smart Fridge' at the University of California San Diego, where consumers pick-up ready made sandwiches from a refrigerated vending machine, and the provider plans to expand launches to airports, hospitals and college campuses in the coming year (Euromonitor International; Consumer Foodservice by location in the U.S, February 2023).

The consumer foodservice industry experienced sustained demand within the historic period, increasing in CAGR by 3.6%, while amidst and post pandemic, experienced improved growth as the industry recovered from a decline of 17.8% (from US$604.4 billion in 2019 to US$496.8 billion in 2020), to an increase in growth by 17.0% to US$680.2 billion in 2022, as many consumers sought and returned to, in-person (out-of-home) dining experiences after facing limiting, pandemic imposed restrictions. Recent inflation and labour shortages however, have since reduced profit margins, making foodservice, specifically independent operations difficult, yet many consumers continued to dine out in 2022. Relatedly, Euromonitor International notes that despite food inflation (driven by supply chain issues, the Ukraine war and extreme weather conditions), comparatively higher grocery prices made many consumers believe they were saving more money eating out, than cooking at home (Euromonitor International; Consumer Foodservice in the U.S, February 2023). In the forecast period, the consumer foodservice industry is expected to increase in growth by an additional 5.0% to attain value sales of US$869.1 billion by 2027.

The limited-service restaurant (LSR) was the largest type of consumer foodservice category in the U.S with values sales of US$341.6 billion (50.2% market share) in 2022, representing a moderate increase in CAGR of 5.3% from US$264.2 billion in 2017. The (LSR) category, similar to other foodservice categories in the U.S, experienced a decline in growth (limited to 2.1%) with the onset of the pandemic, as value sales decreased from US$287.5 billion in 2019 to US$281.6 billion in 2020. The category recovered and experienced growth of 12.3%, reaching US$316.1 billion by 2021, as these restaurants were able to better position themselves as key providers of lower price options for limited budget consumers, and function with fewer employees to minimize contact, while maintaining operational hours . LSRs also benefitted from increases in digital sales especially for pick-up and delivery during, and post pandemic. For example, Q4 of 2022, Yum! Brands witnessed online sales exceed 40% of total sales, and McDonald's, Chipotle and Restaurant Brands International witnessed digital sales of over a third of total sales. (Euromonitor International; Limited-Service Restaurants in the U.S, February 2023).

In terms of value sales and market representation, burger restaurants accounted for a majority (39.7% of the LSR market share in 2022) with retail sales valued at US$135.6 billion, while chicken restaurants had the best performance in the historic period, experiencing increases in CAGR of 11.1% as retail value sales grew from US$23.9 billion in 2017 to US$40.5 billion in 2022 (+8.9% from US$29.9 billion in 2019 to US$32.6 billion in 2020). In comparison, middle-eastern restaurants are anticipated to attain the best growth performance and experience an increase in CAGR of 13.3% in the forecast period.

The full-service restaurant (FSR) was the second largest type of consumer foodservice category with value sales of US$241.7 billion (35.5% market share) in 2022, as many and despite of, full-service restaurants recently increasing their menu item prices to mitigate the impact of elevated inflation in 2021 (Euromonitor International; Full-Service Restaurants in the U.S, February 2023). The FSR category declined in growth by 30.2% from value sales of US$226.7 billion in 2019 to US$158.3 billion in 2020 as intermittent staffing shortages (incurred by location closures and/or reduced operational hours), and staff retention (effected by limited employee salary and benefits) afflicted the category, and present salient issues for the FSR category to address, moving forward (Euromonitor International; Full-Service Restaurants in the U.S, February 2023). The category began to recover increasing in growth by 30.7% as value sales grew to US$206.8 billion in 2021 and additionally increased by 17.0% to reach US$241.7 billion in 2022. Recently, new government support packages such as the COVID-19 aid bill approved in April 2022, has provided US$55.0 billion in financial support to restaurants, bars and other businesses still effected by the pandemic, helping to ensure further recovery for the industry (Euromonitor International; Global Overview of the Hotels and Restaurant s Industry, September 2022). In order to promote further recovery, future site locations of FSR's will have to consider remote working as an integrated component of the working landscape when measuring potential profit margin considerations. In addition, delivery and take-out service options provided by full-service restaurants will continue to be evaluated to determine their viability amidst increasing inflation and competitor offerings (premium subscription plans promoting a monthly fee in exchange for per order fees ) (Euromonitor International; Full-Service Restaurants in the U.S, February 2023). In terms of value sales and market representation, other restaurants were the largest type of FSRs in the U.S accounting for US$87.2 billion (36.1% market share) in 2022, while Asian and Latin American restaurants are expected to be the best performing, attaining growth rates of 5.8% respectively, by 2027.

The cafés/bars foodservice category represented 11.8% of the market share with value sales of US$80.4 billion in 2022, increasing in annual growth by 3.9% from US$66.4 billion in 2017. Notable developments in the category have been through technological innovation and the introduction of new payment terminals (prompting tips for service previously seen in full-service restaurants only) available to the consumer, the integration of products and delivery/take-out services with various platforms, and the growth of QR product codes. Further, recent expansion in the variety of coffee products (cold and iced) available in (specialist) coffee and tea shops, in addition to juices and smoothies, made popular through social media and the growth in online ordering and loyalty programs, has also been noted (Euromonitor International; Cafés/Bars in the U.S, February 2023). Specialist coffee and tea shops were the largest foodservice types in the cafés/bar category representing a 56.4% market share, equivalent to US$45.3 billion in 2022, while juice/smoothie bars were the best performing, attaining an increase in CAGR of 11.2% in the historic period.

Street Stalls/Kiosks attained value sales of US$14.5 billion (2.1% market share) in 2022, representing a slight increase in CAGR of 0.4% from US$14.3 billion in 2017 (−52.2% from US$15.5 billion in 2019 to US$7.4 billion in 2020), and also experienced the most robust increase in growth (50.2%) as value sales recovered to US$11.2 billion in 2021, as restrictions eased and/or were removed. Technological innovation and digitization within the historic period have improved online ordering, tracking and delivery, promoted loyalty programs and facilitated various payment methods which have helped to increase revenue in the category, while an expansion in in-bound tourism is expected to further benefit the category in the forecast period (Euromonitor International; Street Stalls/Kiosks in the U.S, February 2023).

Self-service cafeterias were the smallest category of consumer foodservices in the U.S registering value sales of US$2.0 billion (0.3% market share) in 2022, representing a decline in CAGR of 9.4% from value sales of US$.3.4 billion in 2017 (− 49.0% from US$2.9 billion in 2019 to US$1.5 billion in 2020), as the category struggled primarily from hygiene concerns related to food preparation and handling, and restrictions heightened by the pandemic (Euromonitor International; Self-Service Cafeterias in the U.S, February 2023). Of interest, despite the inflationary environment present during 2022, many self-service cafeterias promoted their value propositions (offering a flat price for unlimited offerings) to their advantage in order to help encourage sales. In the forecast period, interest in alternative proteins and plant-based foods to address the consumer's evolving preferences for healthier eating and lifestyles, are expected to present new opportunities for development and growth within the category (Euromonitor International; Self-Service Cafeterias in the U.S, February 2023).

In forecast period, foodservice restaurants that are able to offer the best value, especially for families such as limited-service pizza and burger restaurants, are expected to perform the best, while high-end full-service restaurants that offer the consumer a total experience, after a long pandemic drought, will be sought. Continued technological advancement surrounding service automation, as well as digital growth provided through broader omnichannel strategies (various apps) promoting specialized products, discounts via subscription and loyalty programs offering product personalization, and delivery options, are also anticipated to continue and expand forecast growth in all categories (Euromonitor International; Consumer Foodservice in the U.S, February 2023).

Foodservice sales: chained franchises versus independent operators

Chained foodservice franchises were measurably larger in the U.S with values of US$397.1 billion (58.4% market share) in 2022 representing an increase in CAGR of 5.3% as value sales grew from US$307.3 billion in 2017 (−6.9% from US$329.5 billion in 2019 to US$306.7 billion in 2020). Independent foodservice operators in contrast, were valued at US$283.1 billion (41.6% market share) in 2022 and experienced a lower increase in CAGR of 1.6% from value sales of US$261.5 billion in 2017 (−30.8% from US$274.9 billion in 2019 to US$190.1 billion in 2020).

Both chained franchises and independent operators were affected by pandemic implemented closures and restrictions and recent inflation however, independent operators incurred greater economic and staffing challenges as their profit margins and wages (pay and benefits) were lower than their chained counterparts.

In the forecast period, both chained and independent are expected to continue to experience positive increases in growth, especially independent operators, who are expected to attain growth rates of 4.9%, despite their lower values sales of US$359.5 billion by 2027.

With the onset of the pandemic (2019-2020), a majority if not most, of the chained franchise categories experienced measurable declines in annual growth ranging from as minimal as 1.7% (Asian LSRs; US$5.6 billion to US$5.5 billion), to greater rates of 45.0% (self-service cafeterias; US$2.3 billion to US$1.3 billion) while the exception of a few categories, most notably chicken and pizza LSRs, which increased by 11.1% (chicken; US$26.3 billion to US$29.2 billion) and 9.7% (pizza; US$22.9 billion to US$25.1 billion) respectively. From 2020-2022, all chained franchise categories experienced recovery in growth ranging from 1.4% (Fish LSRs; US$905.5 million to US$930.2 million) to 25.3% (North American FSRs; US$32.6 billion to US$51.2 billion).

Limited-service restaurants (LSRs) were the largest type of chained foodservice franchise in the U.S with value sales of US$262.2 billion (66.0% market share) in 2022 representing a moderate increase in CAGR of 6.1% from US$195.1 billion in 2017. Of the chained LSRs, burger franchises had the largest value sales worth US$99.7 billion (38.0% market share) in 2022, while the chicken and Latin American franchises were the best performing in the historic period with increases in CAGR's of 12.0% and 8.4% respectively .

Full-service restaurants (FSRs) were the second largest type of chained foodservice franchise with sales of US$91.1 billion (22.9% market share) in 2022, increasing in CAGR by 2.7% from US$79.6 billion in 2017. North American FSR chained franchises were the largest in value sales attaining US$51.2 billion (56.2% market share) in 2022, experiencing the largest increase in CAGR of 3.8% from US$42.6 billion in 2017.

The remaining chained franchise categories, cafés/bars and self-service cafeterias were valued at US$42.3 billion (10.7% market share) and US$1.6 billion (0.4% market share) respectively in 2022. In the cafés/bars franchises, specialist coffee and tea shops attained larger value sales of US$39.6 billion (93.7% market share) while juice/smoothie bars experienced greater increases in CAGR (12.0%) as value sales increased from US$1.5 billion in 2017 to US$2.7 billion in 2022. Of note, self-service cafeterias attained the largest decline in growth (9.4%) from US$2.6 billion in 2017 of all the chained franchises within the historic period.

In the forecast period, all chained franchises are anticipated to continue to experience positive growth. Of interest, Middle Eastern limited-service restaurants are expected to attain the largest annual growth (16.4%) as value sales increase from US$617.6 million in 2022 to US$1.3 billion by 2027.

With the onset of the pandemic (2019-2020), all independent operators experienced significant declines in growth rates. The bars/pubs operator categories experienced the largest decline in growth (58.3%) from value sales of US$32.1 billion to US$ 13.4 billion while the self-service cafeteria operators declined in value sales growth by 62.4% from US$678.7 million to US$255.2 million. Of note, only pizza LSRs experienced an increase in growth, albeit at a measured rate of 1.2%, as their value sales increased from US$7.1 billion to US$7.2 billion. From 2020-2022, all independent operator categories experienced recovery in growth ranging from 6.1% (Burger LSRs; US$31.9 billion to US$35.9 billion) to 52.8%% (Bars/Pubs; US$13.4 billion to US$31.3 billion).

Full-service restaurants (FSRs) were the largest type of independent foodservice operators in the U.S with value sales of US$150.6 billion (53.2% market share) in 2022 representing a measured increase in CAGR of 1.3% from US$140.9 billion in 2017. Of the independent FSRs, other restaurant operators had the largest value sales of US$64.8 billion (43.0% market share) in 2022, while middle-Eastern operators were the best performing with increase in CAGR of 3.6% from 2017 to 2022.

Limited-service restaurants (LSRs) were the second largest type of independent foodservice operators with value sales of US$79.4 billion (28.0% market share) in 2022, increasing in CAGR by 2.8% from US$69.2 billion in 2017. Similar to burger chained franchises, burger independent restaurants were also the largest in value sales attaining US$35.9 billion (45.2% market share) in 2022 while chicken (similar to LSRs) and pizza restaurants were the best performing, experiencing increases in CAGR of 4.7% and 5.5% respectively in the historic period.

The remaining independent operator categories, cafés/bars, self-service cafeterias and street stalls/kiosks were valued at US$38.1 billion (13.4% market share), US$424.8 million (0.2% market share) and US$14.5 billion (5.1% market share) respectively in 2022. In the cafés/bars operator categories, bars/pubs attained the largest value sales of US$31.3 billion (82.3% market share) while juice/smoothie bars experienced greater increases in CAGR (5.5%) as value sales increased from US$225.5 million in 2017 to US$294.1 million in 2022. Similar to chained franchises, self-service cafeteria independent operators also experienced the greatest decline in growth (9.5%) from US$700.9 million in 2017 of all the independent operators within the historic period.

In the forecast period, all independent foodservice operators are anticipated to continue to experience positive growth. Of interest, limited-service pizza restaurants are expected to attain the largest increase in annual growth (6.8%) as value sales increase from US$8.6 billion in 2022 to US$11.9 billion by 2027.

Eat-in versus delivery and to-go sales

The eat-in channel was predominant in the U.S consumer foodservice industry with value sales of US$226.5 billion (33.3% market share) despite its recent decline in CAGR of 5.3% from US$298.1 billion in 2017, followed by the drive through channel with values of US$199.0 billion (29.3% market share), and the takeaway and home delivery channels with values of US$130.9 billion (19.2% market share), and US$123.8 billion (18.2% market share) respectively, in 2022.

The home delivery channel experienced the largest increase in CAGR of 30.5% from value sales of US$32.7 billion in 2017 (+93.0% from US$51.4 billion in 2019 to US$99.2 billion in 2020 with the emergence of the pandemic). Home delivery services through full-service restaurants and self-service cafeterias in particular, increased by 216.0% and 194.4% respectively, between 2019-2020. Further, the eat-in channel experienced the greatest decline in growth (65.1%) as value sales decreased from US$301.4 billion in 2019 to US$105.2 billion in 2020 as pandemic restrictions required the closures of, and/or limited access to foodservice outlets in order to limit the spread of the virus. Eat-in services offered in cafés/bars and/or in the vicinity of street stalls/kiosks in particular, experienced the largest declines in growth, 68.3% and 71.7% respectively, between 2019-2020.

In the forecast period, all channels of consumer foodservices are expected to experience positive, albeit lower increases in growth, with the exception of the cafés/bars takeaway channel and the self-service eat-in channel, which are anticipated to decline slightly in CAGR by 0.3% and 1.4% respectively, by 2027.

Offline versus online ordering

Offline ordering was predominant in the U.S consumer foodservice industry, with value sales of US$523.7 billion (77.0% market share) in 2022, representing a slight decline in CAGR of 0.5% from US$536.1 billion in 2017, while online ordering attained value sales of US$156.5 billion (23.0% market share) in 2022, increasing significantly in CAGR by 36.7% from US$32.8 billion in 2017.

With the emergence of the pandemic (2019-2020), value sales through online ordering increased significantly in CAGR by 98.2% with LSRs and cafés/bars benefiting the most, growing by 116.7% and 113.6% respectively, as foodservice outlets closed and/or modified their operating hours to accommodate restrictions, while value sales through offline ordering declined in growth by 31.6%, with street stalls/kiosks and self-service cafeterias experiencing the greatest declines in growth, 52.6% and 49.8% respectively. During and post-pandemic (2020-2022), the foodservice industry began to recover, experiencing positive growth rates of 17.0% (−17.8% during 2019-2020), as offline value sales in particular grew by 19.1% as restrictions eased or were removed, and many consumers resumed out-of-home dining while the convenience, variety and promotions available through online ordering continued, increasing value sales by 10.8% during this time.

In the forecast period, the consumer foodservice industry is anticipated to increase in CAGR by 2.4% reaching value sales of US$764.4 billion by 2027. Online ordering will continue to attain greater performance, increasing in CAGR by 5.0%, despite lower value sales of US$199.9 billion, while offline value sales are expected to remain larger, reaching US$564.5 billion by 2027.

Competitive landscape

According to Euromonitor International, inflationary pressures, a gradual return of employees to offices and digital growth through online offerings helped many lower-priced restaurants and fast-casual outlets and coffee shops performance in 2022. In addition, full-service restaurants witnessed important recovery in 2022 as mid-level full-service restaurants providing both appeal and lower-priced options, fared the best (Euromonitor International; Consumer Foodservice in the U.S, February 2023).

McDonald's Corp was the largest consumer foodservice company in the U.S with value sales of US$47.5 billion (7.0% market share), followed by Inspire Brands Inc with value sales of US$28.4 billion (4.2% market share), Yum! Brands Inc worth US$25.3 billion (3.7% market share), Starbucks Corp worth US$23.6 billion (3.5% market share) and CFA Properties Inc with value sales of US$18.6 billion (2.7% market share) in 2022. These top five companies accounted for a combined market share representation of 21.1% of the total U.S consumer foodservice market in 2022.

Opportunities for Canada

The United States (U.S) is poised to remain the largest global consumer market over the forecast period (2040), due to its substantial population, significant representation and concentration of affluent consumers and positive economic outlook.

The U.S consumer foodservice industry experienced sustained demand within the historic period, increasing in CAGR by 3.6% from US$568.8 billion in 2017 to US$680.2 billion in 2022, while amidst and post pandemic, experienced improved growth as the industry recovered, as many consumers sought and returned to, in-person (out-of-home) dining experiences after facing limiting, pandemic imposed restrictions. In the forecast period, foodservice restaurants that are able to offer the best value, especially for families, are expected to perform the best, while high-end, full-service restaurants that offer the consumer a total experience after a long pandemic drought, will continue to be in demand.

Industry innovation through continued technological advancement in service automation, as well as digital growth in omnichannel strategies promoting specialized products, discounts via subscription and loyalty programs offering product personalization, and delivery options, are anticipated to continue and expand forecast growth in all foodservice categories.

Given the expected and continued growth in the U.S consumer foodservice industry, and close proximity for trade, Canadian producers and suppliers have an increased opportunity to maintain and expand their exports of agri-food and value-added products to the U.S foodservice market. That being said, it is important for interested Canadian suppliers to work closely with Trade Commissioners to help find qualified importing partners to ensure the U.S import requirements for their specific products, are met.

Benefits of the Canada-United States-Mexico Agreement (CUSMA)

Canada currently enjoys preferential access to the United States market due to the Canada United States Mexico Agreement. The Canada-United States-Mexico Agreement (CUSMA) came into force on July 1, 2020 (replacing the North American Free Trade Agreement - NAFTA), and provides Canadian exporters continued tariff-free market access (with few exceptions), with updates and new chapters to address modern day trade considerations and opportunities (CUSMA outcomes).

Canadian exporters may consult the Canada Tariff Finder to obtain tariff information for specific products and countries where Canada has a Free Trade Agreement.

For more information

The Canadian Trade Commissioner Service:

International Trade Commissioners can provide Canadian industry with on-the-ground expertise regarding market potential, current conditions and local business contacts, and are an excellent point of contact for export advice.

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Resources

• Euromonitor International:
  • Consumer Values and Behaviour in the U.S, pages 17 and 18, May 2023.
  • Consumer Lifestyles in the U.S, pages 25 and 28, May 2023.
  • Country Report: Income and Expenditure: the US, June 12, 2023.
  • Country Report: Consumer Foodservice in the U.S, February 14, 2023.
  • Country Report: Consumer Foodservice by location in the U.S, February 2023.
  • Country Report: Limited-Service Restaurants in the U.S, February 14, 2023.
  • Country Report: Full-Service Restaurants in the U.S, February 14, 2023.
  • Country Report: Cafés/Bars in the U.S, February 14, 2023.
  • Country Report: Street Stalls/Kiosks in the U.S, February 2023.
  • Country Report: Self-Service Cafeterias in the U.S, February 2023.
  • Country Report: PEST Analysis: The U.S, June 2, 2023.
  • Global Overview of the Hotels and Restaurants Industry, page 26, September 2022.
  • Government of Canada, About CUSMA
  • The U.S Consumer Profile, June 2023.

Foodservice Profile – United States
Global Analysis Report

Prepared by: Laurie Bernardi, International Market Research Analyst

© His Majesty the King in Right of Canada, represented by the Minister of Agriculture and Agri-Food (2023).

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