The rise of fast-food in the UK despite the recession
Fried chicken restaurant chain KFC, has seen steady growth for the past seven years, despite the recession. As a result, the company is now set for a massive expansion, spending £40 million on 40 new fast-food restaurants across the UK and Ireland, creating 1,600 jobs in the process. It also plans on spending a further £40 million on refurbishing 160 stores across the UK to “create a more modern, welcoming environment for customers”.
And with 50% of all meals eaten out of the home now being from fast-food restaurants, it’s not just this particular chain that is reaping the rewards as the purse strings have tightened. US fast-food giant McDonald’s also announced profit hikes last year. The company said sales in the UK had soared despite the weak economy, with its premium burgers such as the Chicken Legend, as well as breakfast products and its late-night menu all growing by more than 10%. The company also refurbished and modernised its restaurants across the UK and opened another 13 sites last year, creating 800 jobs.
Jill McDonald, the head of McDonald’s in the UK, said. “Customers are a lot more discerning about how they spend their money. We can offer a meal out for a family of four for less than £15.”
This repositioning of its restaurants as a potential destination for families stands in stark contrast to its past image as an unhealthy eating destination, as portrayed by the film Super Size Me. But it shows that the chain has been unaffected by the recession as family budgets decline.
Domino’s Pizza is another high street favourite to report strong performance, with sales topping £164m for the 13-week period to March 31 this year. The pizza chain also reported a whopping 38.4% increase in online orders to £82.4m, accounting for 62% of its overall UK sales. The US-based group, which runs European franchises in the UK, Ireland, Germany and Switzerland, said total sales rose 12.3% to £164.1m. This growth is the driving force behind the company’s plans to open 60 franchises during 2013, having launched 56 last year.
But this has been developing since the recession began. Back in 2009, the FT reported that “Britons were filling up on buckets of fried chicken and takeaway pizza as the recession deepens, turning their backs on the fashionable restaurants and gourmet food that had boomed as incomes peaked”.
But still the shift seems to have taken some people by surprise. In the early days of Austerity Britain, many predicted that tough times would force people to return to healthier, more basic diets akin to the home-cooked food seen during the Second World War. Instead, fast food is on the rise, as are the companies that sell it.
The reality is that the growing popularity of fast food has been driven by the fact that despite the doom and gloom people still want the convenience of not having to cook, but they do not want to pay restaurant prices. Prior to the recession, some people would eat out in restaurants three to four times a week, but they are now forced to stay in more to balance the books. And these people are reacting to the drudgery and bad news that surrounds them by thinking “stuff it, I am going to treat myself to a pizza and not wash up”.
Back at the start of the current recession, there was the indication that fresher food was beginning to fall out of favour. Sales of fresh fruit and vegetables rose by just 3% in 2009 according to data provider Nielsen, which is less than the growth of the food market as a whole. Sales of tinned goods, meanwhile, rose 8.2% and frozen food sales climbed 5.6% after several years of stagnation.
This viewpoint has been backed up by a recent survey from University of Miami school of business administration, which found that people are more likely to tuck into fatty snacks than healthier alternatives if they believe food resources are scarce or if they are subconsciously primed to think about struggle and adversity.
So, it seems our penchant for fast food is likely to stay with us for some time to come. And as more and more shops are closing on our high streets it seems we’re likely to see a growing number of fast-food chains taking their place.