The Future of Foodservice 2022 Series: #6 Predictions for the Future

9th December, 2022

Predictions for the Future of Foodservice

According to Global Data, the total Australian foodservice market amounted to $50.51 billion in 2021. The market is expected to grow at a Capital Annual Growth Rate (CAGR) of more than 6% during the period 2021-2026.

We are all too familiar thinking back to March 2020, where most of the industry were either operating under restrictions or were closed. At the time, leading to a drop in dine-in occasions in the sector and deliveries and take-aways played a significant role in the sector and partially eased the decline in 2021.

Fasttrack to 2022 and we are now seeing steady growth and the return of the diner according to John Hart, Chairman of Tourism Training Australia (TTA) in a recent presentation at the Sydney FSAA November Breakfast event. The data is out, showing dining is back and stronger than 2019 figures with $33.2 Billion of the $54.4 Billion Foodservice total as of July 2022.

This, together with the Global Data predications, indicates that we are on a steady path of growth and demand will be there. NSW, as usual, is leading the country in turnover, however QLD has shown the strongest growth with population growth figures increasing in recent years.

The growth can be attributed to the increase in pricing of course, however the net result is that people are eating out and spending more whether they are dining in our taking out. Growth is at 126% and 130% respectively. “Customers are eating out more frequently and paying more.” Said John Hart “they are happy to pay more however are demanding the quality is there.”

Other noted trends on the rise are:

Plant-based food – this is helping pricing to be sustainable with the sharp increase and restricted access to animal protein.

Sustainable practice – this is across the board and in high demand.

Less alcohol – the millennials are driving this and is why we are seeing the increase of low or no alcohol categories on the rise.

Global cuisine – this is nothing new to Australians, we are the best in the world at embracing cuisine from other countries.

Social media integration – this should come as no surprise with the rise of the Software as a Service (SAAS) sector in recent years.

Changing restaurant layout – this is driven by the proportion of delivery orders that venues are now used to. Preparing and keeping food optimal for delivery protocols has required change.

Resurgence of ‘fine dining’ – with the demand for quality premium dining is back on the agenda.

Ghost and production kitchen – predicated by Covid, however this has been talked about for years now.

Virtual restaurants – this is also driven by venues having to pivot and introduce new revenue streams.

Our operators have absolutely become smarter operators and know they had to make changes to survive.


The Workforce – cause and effect

John spoke at length around the state of play for the Foodservice Workforce. A summary is outlined below:

  • Shortages are requiring business to open SHORTER hours (either days or weeks).
  • Serving the same number of dining occasions over fewer hours.
  • Managing service periods to maximise productivity.
  • Vacancy rates are sitting at 16%, causing significant issue in capacity (74% of PCR).
  • Staff numbers are not meeting the demand of the skills required.
  • Production staff numbers are growing significantly compared to creative staff.
  • Cost of transport is double pre-COVID restrictions.
  • Ghost and production kitchens growing.
  • Use of pre-packaged and pre portioned foods again on the rise.
  •  Local, pre-packaged foods are the priority.

Food Inputs – cause and effect

The greatest price increases have been attributed to the animal protein groups (meat and seafood) which has risen by 36.2%.

  • Foodservice businesses are responding to this by adjusting their menu to include dishes with lower protein proportions.
  • Higher prices are being charged for animal protein groups.
  • Plant-based foods are the popular alternative and rapidly increasing.
  • Research effort into alternative protein accelerating.
  • Reduced menu offerings and optimal menu planning.

Other Inputs – cause and effect

Vacancy rates increased – rentals converting to temporary style operations ‘pop-ups’.

Increased wages (40-50%) and food prices (30-35%) is placing pressure on other potential input.

Savings and efficiencies are being sought through automation and outsourcing. Fixed consumables and replacements costs reductions sought.


Essentially, the future is looking to brighter than it has in the past couple of years with growth predicted and by all indications that even with inflation pressures, people will continue to choose to eat out.

Demand for dining occasions is very strong.

Consumers will be seeking more for high quality particularly, sustainably sourced and local and they are prepared to pay for it.

Less alcohol and creative beverages.

Labour shortages are creating restrictions on opening hours and adaptation is necessary.

Higher quality, local and smaller protein pre-prepared food options required.

More flexible locations, centralised production, and more local product availability a feature.

Australia foodservice market size was valued at $50.51 billion in 2021 and $54.4 billion at July 2022.

The Australian food service market is expected to grow at a CAGR of more than 6% during the forecast period.

Out of Interest

The key channels in the foodservice market in Australia are full-service restaurants (FSR), quick-service restaurants (QSR), pub, club & bar, coffee & tea shop, accommodation, retail, leisure, workplace, travel, ice-cream parlor, and mobile operator.

The key companies in the foodservice market in Australia are McDonald’s Corporation, Yum! Brands Inc., Domino’s Pizza Inc., Doctor’s Associates Inc., Craveable Brands, Grill’d, Nando’s, Sushi Train, Urban Purveyor Group Pty Ltd, Minor DKL Food Group, Retail Food Group, Foodco Group Pty Ltd, Starbucks Corporation, La Kaffa International Co. Ltd., Merivale, MAdE Establishment, Vue Restaurants, and Melbourne Pub Group.

Members can access and read the full presentation made by John Hart  here

For more information about the FSAA visit

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