Government massively overstates size of the UK eating out market
A claim by the UK’s Office of National Statistics (ONS) that the amount spent on eating out of home exceeds the amount spent on eating at home does not measure what it says it measures, according to our ongoing analysis of the sector. The major flaw in the ONS claim on the value of eating out is to include hotel accommodation and all alcohol served out of home in the overall figure. The government is looking at the whole spend on hospitality and not splitting out food spend from accommodation and standing at a bar and just drinking.
While the ONS claims an annual eating out spend of £87 billion, Horizons’ research puts the true figure at £35.8 billion.
The ONS further uses its figures to claim that share of the food £ spent on eating out is greater than the retail food spend. In other words the ONS are saying that for every £1 spent on food in shops, more than £1 is spent on eating out in hotels, restaurants and pubs.
This is a higher proportion than in the USA which has unarguably the largest foodservice sector in the world. It is most unlikely that the UK sector exceeds the US market.
Horizons research, carried out in conjunction with the Institute of Grocery Distribution, shows that for every £ spent on food, 31 pence is spent in the eating out sector.
We are disappointed that the ONS has chosen to report in this way since, although its figures are undoubtedly well researched, whatever the figures measure, it is not the eating out market as commonly understood.
In summary, Horizons say that the eating out market in 2005:
- Is worth £35.8 billion ie consumers spend £35.8 billion on food and drink when eating out
- This is equivalent to 31% of total food and drink expenditure sold by shops and the foodservice sector combined
- Excluding alcohol and soft drinks, consumers spend £26.6 billion on food away from home
- Operators spent £9.3 billion on food and a further £2.6 billion on alcohol and soft drinks