Australia’s Restaurant Industry Grows in 2014, Though Families Continue to Pull Back on Visits, NPD Group Reports

Redefining Value Sets Stage for Savvier Consumer in 2015

Sydney, Australia, March 4, 2015 – Australia’s commercial restaurant industry grew 4 percent in 2014 compared to the prior year, driven more by average cheque size than by traffic, according to global information company The NPD Group. Visits were kept afloat by an increase in adult only parties (5 percent), while families declined (-6 percent).

“In line with the weak consumer confidence level reported in Australia since the May federal budget, consumers with kids are reducing restaurant visits and modifying their spending behaviour,” said Ciara Clancy, Director of Foodservice Australia, The NPD Group. “For families, restaurants are one of the first items to be trimmed from their budget, and they are likely to seek more cost effective alternatives."

Though overall results were a mixed bag, all three big meal occasions experienced gains in 2014, led by dinner (4 percent), and followed by breakfast and lunch, each rising 2 percent, with the holiday season in particular seeing consumers eating out more for these occasions. For dinner and lunch, 2014 marked a return to growth versus year-end 2013. Quick service restaurants (QSR), which make up nearly three-quarters of the total commercial restaurant market, were the main venue of choice and leading source of the gains. At QSR, occasions not associated with deals grew 2 percent, after a decline the previous year.

“With lower priced options saturating the market, consumers are becoming less motivated by a promotion or price led activity and reevaluating what constitutes as a deal for them. Their definition is shifting from ‘low price’ to ‘value for their money,’” added Clancy. “We are seeing a savvier and more cautious consumer emerge in the industry. Consumers are being more selective and cost efficient in terms of their restaurant occasions and choices.”

Source: The NPD Group, Inc. / CREST®

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