The fast food market - Belgium

1.2 The global fast-food market

The global fast-food market reached $***.* billion in **** and is expected to grow rapidly to almost $*** billion by ****, representing an average annual growth rate of *.*% over the period **** to ****. Of the total foodservice market, fast food is the segment with the largest market share (***) and the highest average annual growth rate. This growth is mainly driven by new trends, the success of food trucks and food tech, and the growing interest in world cuisine, as well as by emerging economies where Western brands are becoming increasingly established. The USA is the country with the largest market share, and is set to maintain this leadership position in the years ahead. [***] In Europe, fast food is also set to grow, albeit at a slower pace than in emerging economies, despite growing health awareness and concerns. This growth is being driven by the fast, convenient nature of fast food, which enables it to keep pace with new lifestyles, as well as a wider range of products where healthy alternatives are also available. In this way, the fast-food sector should increasingly meet the expectations of a segment of the population looking for speed and convenience, but also healthy eating. These expectations are already reflected in new ...

1.3 The Belgian fast-food market

The fast food market is a subset of the restaurant sector as a whole.

The Belgian foodservice market grew by *.*% between **** and ****. Nevertheless, growth slowed in **** (***), with the market estimated at €*.** billion in ****.

Sales of restaurants and mobile food services France, **** - ****, € billion Source: ****

The Belgian fast food market:

The relative weight of fast food restaurants has grown since ****:

Source: ****

It's difficult to find statistics on the total value of the fast food market in Belgium, but we can estimate it using the total share of restaurants that are part of the fast food industry. In ****, **.*% of Belgian restaurants are positioned in the fast food segment. We can estimate that fast food is responsible for between **% and **% of restaurant sales in Belgium, which would therefore give us a total market value ranging from €*.* to €*.* billion in ****.

1.4 The impact of the Covid-19 crisis

While the Covid crisis has affected all players in the restaurant industry, the major fast-food chains have suffered less than "classic" restaurants for several reasons:

During the confinement(***), delivery, driveshots and takeaways remained possible: and the big chains are more advanced in this area than the independents. The big chains have greater financial power and reserves than the independents, which should be to their advantage.

To take the example of Covid's impact on McDonald's, according to Le Soir:

lower sales in **** than in **** a drop in customer numbers of between **% and **%, depending on the restaurant

Exki, meanwhile, has announced a **% drop in sales [***]

2.1 Changes in Belgian budget structure favor out-of-home catering

changes in Belgian spending patterns :

Source: ****

The Horeca sector (***) saw its relative share increase from *.*% of the total budget in **** to *.*% in ****, indicating that out-of-home catering is taking on increasing importance in the lives of Belgians. At the same time, food products have tended to stagnate in terms of budget share.

According to FEBED (***), per capita spending on the on-trade totaled *,*** euros, but there are significant regional disparities:

in Wallonia, it represented *,*** euros per inhabitant brussels *,*** euros flanders *,*** euros

Nevertheless, Belgians do not want to increase their restaurant visits, which are likely to remain stable.

The vast majority of Belgians indicated in **** that they would continue to eat out at the same frequency.

Although **% say they want to reduce their consumption of meals away from home, these are only intentions - whether they will be kept remains to be seen.

How often do you plan to eat out? France, ****, in Source: ****

2.2 Belgian eating habits (at work)

A study conducted by Edenred on the ideal meal in several countries gives us some insight into the criteria taken into account when Belgians choose where to eat.

How much time do you spend on your lunch break (***)? Belgium, ****, in % Source: ****

Belgians eat lunch fairly quickly: **% eat lunch in less than ** minutes and **% in less than ** minutes. This speed demanded by consumers is a major asset for fast food.

Type of lunches eaten by Belgians on working days France, ****, in Source: ****

When having lunch at work, **% of Belgians eat out at least once a week, whether in a restaurant or takeaway. Given that they spend less than ** minutes overall on their lunch, we can assume that a large proportion of Belgians regularly eat in fast-food restaurants. What's more, **% of Belgians pay attention to the speed of service when choosing their restaurant, which should play in fast food's favor.

2.3 Ways Belgians eat at home

Dinners are generally home-cooked: **% of Belgians claim to prepare them themselves every day. However, take-away meals remain important, with **% of Belgians using them at least once a week.

What kind of meals do Belgians eat at home? Belgium, ****, in Source: ****

Belgians take much longer at meals at home than at work: **% take more than ** minutes for dinner, including **% who take more than three-quarters of an hour.

How much time do you spend on your dinner? Belgium, ****, in % Source: ****

2.4 Fast-food patronage and consumer preferences

McDonald's is by far the most popular fast food chain among Belgians, with almost a quarter of the population claiming to eat there. However, the most striking statistic is the proportion of Belgians who don't eat at all: *.*%.

It's important to note that two pillars of Belgian fast food are not included here, as they are mostly independent: kebab shops and French fry shops.

Almost * out of ** Belgians find fast food "good" (***). [***]

Which fast-food chains do you frequent? Belgium, ****, in % Source: ****

* in ** Belgians visits fast food twice a week. This **% of the Belgian population represents the largest and most loyal customer base for fast food.

One of the arguments for eating at a fast food restaurant is that you don't have to prepare your meal: just over **% of Belgians admit to being too lazy to prepare fresh food. Despite this, * out of ** Belgians try to eat a balanced diet, which could boost demand for healthy fast food [***]

A study conducted by Snackblad in **** gives us an indication of the rate at which "snack bars" are frequented in Flanders.

Snack bars are restaurant-cafés - often independent - offering fast food services.

Frequency of snack bar visits in Flanders Belgium, ****, in Source: ...

3.1 Segmentation and player dynamics

A highly competitive market: numerous players covering a fairly broad offering

The fast-food sector is divided between independent players and large, often international, chains.The business remains dominated by major groups and networks such as McDonald's, Subway, Yum! Brands (***).

The boundaries of fast-food are not always clear - some bakeries, for example, often offer fast-food services (***) in the form of prepared sandwiches and menu offerings. Food trucks are another example.

Focus on McDonald's: [***]

Since ****, McDonald's sales in Belgium have multiplied by *: in ****, * million new customers have been won over. In ****, McDonald's planned to invest €** million and create *** jobs to expand and improve its restaurant estate.

McDonald's **** review highlights that the restaurant estate comprises ** restaurants, operated by ** franchisees, with the average franchisee owning * restaurants (***). In ****, McDonald's plans to open ** new restaurants and convert *. The question of territorial coverage is indeed an important one:"Our aim is for consumers to have to travel no more than ** minutes to find a McDonald's. Based on this, we don't even cover half the country. So there's still room for growth," says McDonald's Belgium manager.

evolution of fast food since its arrival in Belgium in the **s and **s:

Historically, the first fast-food outlets to arrive in ...

3.2 Production analysis

Analysis of meal "production":

Production in the fast-food sector is a major factor in brand organization, as the entire market concept is based on fast food. As a result, operations are standardized as far as possible to optimize preparation time. Often, the basic ingredients are already prepared and the "final" product is assembled at the customer's request. This applies very well, for example, to salad bars or Subway. z

Distinction between international chains and smaller players :

International chains:

- In-plant mass production

- Delivery of pre-cooked or frozen foods to stores

- Freezer storage

Work fragmentation and store layout play a distinctive role. These are standardized and do not change regardless of location or geography. Every McDonald's has the same store layout. To ensure that the supply chain operates as efficiently as possible, the installation resembles an assembly line. Simplification, division and standardization of work are three key elements.

Independent:

Any aspect related to the production and processing of meals for these business models does not present a uniform operation and varies according to the physical layout of the store and the offering.

3.3 A market split between major chains and independent players

The number of fast food restaurants has steadily increased in Belgium, rising from ***** in **** to ***** in ****, representing a total increase of **%.

Trend in the number of fast food restaurants Belgium, **** - ****, in thousands of restaurants Source: ****

There are two main distribution channels used by fast food players.

Indirect channel: the franchise system

The most popular distribution channel for fast-food chains is franchising. This method allows you to

Autonomous management of the business Benefit from established brand awareness Rapid expansion

To open a franchise, there are a number of cost requirements to be met, depending on the brand chosen. The most famous international chains have built their entire network on franchising, expanding rapidly and efficiently in many countries. The giant par excellence is McDonald's. In ****, **% of restaurants were franchises; by ****, this had risen to **%.

Direct channel: own store

This alternative distribution option mainly concerns small businesses. In Belgium, most market players, with the exception of the major international chains, have spread out across the territory via this channel.

3.4 Massive growth in online sales and delivery services

the battle between fast-food brands now also includes online sales. Given the trend towards at-home snacking, professionals are seeking to capture this burgeoning demand. This is being done through the development of online ordering and delivery services, and in-store collection (***).

Number of restaurants available on TakeAway.com Belgium, ****-****, in thousands of restaurants Source: ****

To estimate the evolution of meal delivery in Belgium, we can take the evolution of the number of restaurants available in Belgium on one of the leading platforms, TakeAway. Between **** and ****, the number of restaurants on the platform increased by ***% to a total of **** restaurants. TakeAway therefore has around **% of the ***** restaurants listed in Belgium on its platform.

Other platforms such as Uber Eats, Deliveroo and Glovo are also present in the country. In ****, a Belgian player began to make its mark on this flourishing market: Deliverect, a delivery platform management software, successfully raised ** million euros in funding(***).

The Covid crisis is likely to reinforce this boom.

4.1 Fast food typology

There are several sub-categories into which the fast-food market can be broken down.

The most popular variable for distinguishing these fast-food categories is the typology of foods sold, which can essentially be traced back to the country of origin.

While the meals covered by fast-food outlets are often lunches or dinners, we're seeing a boom in fast food for breakfast, with players like Paul or Point Chaud, and even big chains like McDonald's.

4.2 Price analysis

consumer price trends in Belgian restaurants since ****:

Overall, prices in the restaurant sector have risen since ****, but the increase is greater in restaurants and cafés (***).

Consumer price trends in the foodservice sector Belgium, **** -****, index base *** **** Source: ****

The fast-food market is characterized by intense competition and high product substitutability, making price a powerful weapon for capturing new consumers.

The original success of the fast-food model is based on two variables: price and speed. These two variables are closely linked, because to achieve a profit margin, companies need to sell a large number of products.

Thus, in the majority of fast food restaurants, meals will cost between €* and €**. Many chains are trying to widen the range of possible prices.

However, more and more chains and independent restaurants are offering better quality products at a higher price. One of the best examples is Exki, while fast-food prices are closer to €**-** per meal.

4.3 Supply trends

Towards healthier food:

Belgian consumers are increasingly sensitive to health and wellness issues, as evidenced by the emergence of new fast-food restaurants offering balanced meals.according to Ipsos, **% of Belgians believe that their access to healthy food will improve or remain the same in the coming years. It is therefore crucial that restaurants diversify their offerings to meet Belgians' expectations.

In the coming years, do you think your access to healthy food will improve or get worse? Belgium, ****, in % Source: ****

"Healthy" meals are thus in vogue, even at fast-food restaurants. Vegan or vegetarian offerings are also on the rise.

Fast food and respect for the environment: [***]

In ****, the EU will ban the use of single-use plastic products. Many players have anticipated this regulation, as it is also a question of meeting the expectations of consumers who are increasingly concerned about the impact on the environment. McDonald's, for example, has introduced biodegradable straws and aims to reduce plastic packaging (***). [***]

One of the problems with fast food is the mass of waste it produces: *,*** million plastic straws were consumed in ****. Reducing this waste is a major challenge for the fast food sector.

5.1 Current regulations

The hotel and catering sector is highly regulated in Belgium. The main rules are grouped into themes common to the entire sector: Fire safety, Insurance, Indication of prices, Copyrights and similar when broadcasting music or images, Conditions for allowing your customers to smoke, Alcohol and similar drinks, VAT - Tariffs - Receipts - Cash register, Food safety food safety, Environmental permits, Acoustic standards, Legionella, Drinking water, Accessibility, Waste, Sewage disposal, Opening and closing days, Toilets, Doorman, Local regulations, Staff recruitment, Joint committee of the hotel industry.

In terms of hygiene, theFASFC is responsible for issuing authorizations to sell foodstuffs. They issue three types of authorization:

registration if the food served is pre-packaged and has a shelf life of at least * months at room temperature, such as potato chips or preserves authorization if the food served is processed or not pre-packaged, such as restaurant meals approval to set up an industrial business producing foodstuffs, such as fish or meat.

6.1 Player segmentation

• McDonald's
• Burger King Restauration
• Domino’s Belgium
• Pizza Hut USA
• Exki
• Point Chaud
• Subway