The fast food market - Italy (2023)

1.2 Fast food: a large portion of the food industry

Fast foods are designed to provide a faster and more cost-effective option for the customer by indulging in faster prepared foods. Convenience and taste are the main strengths of the industry, which in recent years has sought to improve its nutritional content and healthiness of fast food by adding ingredients that are, at times, healthier.

The global fast food market recorded a compound annual growth rate (***) of *.* percent between **** and ****, rising from a value of $***.** billion to $***.** billion. The Russia-Ukraine war has reduced the chances of a global economic recovery from the effects that followed the Covid-** pandemic, at least in the short term. The war between the two countries has led to the enactment of major economic sanctions on multiple countries,soaring commodity prices and supply chain disruptions, causing inflation on goods and services and increasing criticality in several markets around the world. For these reasons, the fast food market is expected to grow to $***.* billion in ****, with a reduced CAGR from the previously attested rate hovering around *.* percent.

Geographically, North America is the region with the largest fast food market in ****; the forecast places the Asia-Pacific region as the main growth player over the forecast period.

Global fast food ...

1.3 The local market

The fast food industry in Italy has evolved considerably in recent decades, going to reflect changes in food preferences, lifestyle, and cultural trends in the country. Although there has been a decline in the number of fast food outlets of about *.* percent in the period between **** and **** (***), popular dishes such as pizza, pasta, noodles, burgers, and sushi dominate the Italian market, with fast food brands specializing in these products. The product to hold a substantial share in the Italian restaurant scene is certainly pizza, with about **,*** restaurants in the country offering the most varied types.

To find out the value of the fast food market in Italy, we use Istat data belonging to Ateco Code **.**.**, "Fast food and take-away restaurant services." Since more recent data regarding the monthly household expenditure item are not available, an estimate of the market value of the last available year is proposed below. The formula used for the calculation is:

Market value = Monthly household expenditure * Number of households

1.4 Distribution in the restaurant industry

According to data proposed by Deloitte, the value of the Italian restaurant market in **** was about €** billion. Although the largest market share is still in the hands of traditional restaurants, with a value of about €** billion, the sector has changed significantly. Fast food ranks second, with a ** percent share, which corresponds to ** billion €. [***]

Food distribution market divided by type of service provider Italy, ****, % Deloitte

Exponential growth in out-of-home consumption

One of the determining factors in the growth of the fast food sector is the trend of consumers in eating increasingly away from home; in **** , the growth of out-of-home food consumption increased by ** percent over the previous year, in a context in which domestic food consumption showed little growth of about *.* percent.[***]

1.5 Impact of the derivative

Following the outbreak of the Covid-** emergency, the first restrictions and travel bans were imposed in an attempt to contain the spread of the virus; for these reasons, during the lockdown instituted starting in March ****, all restaurants, bars, and fastfood giants were forced to close. This attested to a rise in the use of delivery platforms by merchants, who immediately embraced the very high demand from Italians during the lockdown periods. Food delivery began as a new fad, to turn into a necessity during the lockdown months, and over time has become an alternative to restaurants for many, with increasingly personalized offerings. Analyzing the searches of the two major food delivery aggregators during the lockdown period shows this increase in search by users.

Visits by keyword Italy, ****

As has been stated, delivery has been one of the main allies for restaurant survival and consumer supply during the lockdown period, however, even following the easing of restrictions, home deliveries have not seen a setback; following ****, in which Italians' online food spending reached *.* billion euros (***), growth figures were also recorded in **** and **** . In **** , there is a key increase in the food grocery sector of **%.[***]

Frequency to order food at home during lockdown

According ...

2.1 Demand characteristics

Going to analyze the average monthly expenditure of households in the fast food and takeaway sector, we see an increase in product search between **** and ****, only to experience a significant decline in ****, rising again by **.* percent in ****, a figure surely influenced by the increase in demand during the lockdown period.

Average monthly expenditure of Italian households on fast food and takeaways Italy, ****-****, € Istat

2.2 Factors influencing demand

Culinary tradition has always represented an identity and cultural pillar of the Italian Peninsula. More than **% of Italians are familiar with traditional recipes and dishes handed down from generation to generation, in a context in which the variegation of typical dishes changes considerably depending on the region under consideration, offering, thus, a wide choice. In spite of these premises, Italy is by no means a country averse to the infiltration of new innovations and trends; globalization has led to a natural shift in consumer preferences, which are increasingly attracted to fast food, considered functional in adapting to consumers' changing lifestyles.

More challenging lifestyles

In Italy during ****, **.*% of workers say their working lives have worsened and that they would leave their jobs if they could. **.* percent believe that wages are not adequate to their needs, and **.* percent fear job insecurity, admitting that they experience deep uncertainty with respect to the work they do.[***]

Longer working hours and increasingly crowded calendars are reflected in the attention Italians pay to personal care and their diet. Among the main reasons that drive Italians to eat at fast food restaurants is present, certainly, the lack of time. [***]

*. Eating out

According to data exposed in TradeLab's ...

2.3 Geographical distribution of demand

To analyze the geographic distribution of demand, a map was created that presents monthly household spending on fast food and take-away services by Italian macro-region in ****. From this, it can be seen that in Northern Italy , monthly spending on this sector is higher, standing at around €**.**/month, followed by Central Italy€**.*/month and, finally, Southern Italy €**.*/month.

Geographical distribution of demand - food delivery

Thanks to the report proposed by Just Eat, we can learn more characteristics regarding consumers of products belonging to the fast food chain (***). Specifically, it is recorded that the customer base is composed of **% men and **% women. Of these, ** percent belong to the age group of ** to ** years old, while ** percent are between ** and ** years old. Geographically, the clientele is distributed **% in cities , **% in urban areas and **% in rural areas.

Places where consumers of fast food products live (***) Italy, ****, % JustEat

2.4 Food delivery: between choice and necessity

Smart working and new food trends

A new corporate food delivery format has emerged in recent years. The service allows companies to create their own account and be able to manage lunch orders at the office or from home. With *,*** registered users mainly between Milan and Rome, the service saw a ** percent growth in registered customers in the second quarter of **** compared to the same period in ****. Among smart workers,**.* percent use home delivery and **.* percent use food delivery platforms . This segment, growing year on year, cannot go unnoticed.

Consumer opinions

Thanks to an analysis reported by Coldiretti, we can learn about the relationship between consumers and this new consumption methodology. Specifically, four out of ten Italians who order food on food delivery platforms believe it is a priority to improve the protection of riders' labor rights; in addition to this type of change, customers believe there should be useful changes for the health and growth of the market. **% demand improved product safety during transportation, to ensure that proper hygiene standards are totally met, avoiding contamination and preserving food quality. On the other hand, **.* percent demand an increase in the use of typical products from local suppliers.[***]

Thoughts of Italians who ...

3.1 Market organization and dynamics

The fast food market in Italy has some key characteristics that make it a decisive player in the restaurant market:

speed: customers are looking for ready-to-eat food quickly; accessibility: fast food meals tend to be inexpensive, making them accessible to a wide range of customers; standardized menu: fast food restaurants often offer a standardized menu with few options, simplifying ordering; strong branding: fast food chains often rely on recognizable branding to attract the greatest number of customers; effective communication: advertising plays a key role in attracting customers to special offers and new products; evaluation of new trends: some fast food restaurants sometimes adapt to regional or cultural tastes, while others try to cater to a variety of food preferences depending on the diet followed (***)

These characteristics make the fast food market attractive in the global and domestic contexts, despite the fact that Italy sees a trend of purely fragmented chains, with minor players flanking the popular international chains (***).

Fast food chains have significantly increased their presence on the Italian territory, multiplying the opening of establishments; although fast food has become a product in demand by Italians in recent years, until **** the penetration rate of chains was *.* percent, well below the European ...

3.2 Value Chain

3.3 Different business models and distribution channels

In Italy, the fast food market is based on two main business models: Indirect Channel, Franchising: franchising is the most popular model for fast food chains in Italy. This approach allows owners to run operations independently while taking advantage of the brand's established reputation. Franchising allows for rapid expansion of the business. To open a franchise, there are various cost requirements, which vary depending on the brand chosen. Well-known international chains such as McDonald's have based their expansion primarily on franchised restaurants. For example, in ****, **% of McDonald's restaurants in Italy were franchised. Direct channel, owned store: this model is more common among smaller businesses in the industry. Many players in the Italian market, apart from the major international chains, have developed through owned stores. In addition, fast food restaurants in Italy distribute their products through various channels: In-Store Sales: fast food outlets offer indoor or outdoor spaces where customers can consume their food on site. They are usually located in high-traffic locations such as city centers, shopping malls, or highways. Customers order at the counter or use self-service platforms, wait for their order to be ready, and then eat on the spot or take their food away. This is the most ...

3.4 Main actors

As has been previously stated, the fast food sector is growing steadily in the Italian context. The culinary preferences of Italians, traditionally linked to home cooking and regional delicacies, are gradually embracing the appeal of fast food, with a growing demand for fast and affordable products. Against this backdrop, many of the chains present in Italy have adapted their approach to meet local tastes and needs, creating a dynamic and competitive market divided into national and international chains.[***]

Below is a list of some of the major players in the sector:

Pret a Manger: a British fast food chain founded in **** in London. The brand's philosophy promotes fast but healthy dining, using fresh and genu products prepared daily. Taco Bell: a chain that is part of the Yum! Brands, was founded in **** and is a predominantly Mexican-style cuisine. McDonald's: founded in ****, it is the best-known fast food chain on the globe; about ** percent of openings are through franchising. Kentucky Fried Chicken (***): a U.S. fast food chain specializing in Kentucky fried chicken; KFC's network now operates in more than *** countries worldwide. America Graffiti: established in Forli in ****, it is inspired by ****s America, an aspect that is also evident in the ...

4.1 Subsegments of Fast Food

The fast food market can be broken down into several subcategories, as one can analyze the variable of type of food sold (***) which can essentially trace back to the country of oridine.

Based on their geographical origin, fast foods are segmented into:

Asian-inspired fast food is the fastest growing category within the fast food industry, with sales and global demand becoming increasingly entrenched.

4.2 Offerings aimed at a specific consumer

Fast food companies operating in Italy are expanding and customizing their offerings to meet customers' needs. For most fast food restaurants, the offerings are focused on:

Families: as some fast food chains were originally aimed at families with children and young adults. Therefore, they developed some specific products aimed at these categories, such as the children's menu, which has been a powerful tool for attracting children and parents. One example is McDonald's Happy Meal, which, due to its low price, simple products, and inclusion of toys, is a favorite choice among children. Local culinary tradition: International fast food chains usually customize their offerings to suit the local target audience. In fact, they offer a menu typical of the local culinary tradition. In Italy, for example, McDonald's offers fried mozzarella, parmesan snacks to be closer to Italian tastes. Dietary restrictions: More recently, fast food companies have developed new products for customers with dietary restrictions, such as celiacs, vegetarians, or vegans. For example, La Piadineria offers a vegetarian piadina, and MyChef collaborates with outside companies, such as DS Food or Schär, to offer gluten-free products to its customers. In this case, nothing is cooked or handled by the fast food staff, but ...

4.3 Prices and convenience

Below is the percentage change in price change in **** compared to ****. Specifically, it can be seen that the sectors of traditional ristration and pizzerias register increases of *.* percent and *.* percent on average for the year. Food delivery registers increases of *.* percent, and the sector examined in this survey, fast food, registers a change of *.* percent from the previous year. [***]

Change in prices in the restaurant industry Italy, ****, % Confindustria

The fast food market is characterized by intense competition and a high variety of products; price becomes an essential element for competition among market players, who must try to remain appealing to consumers. In addition to price, speed is also an essential element, especially since in order to maintain a good profit, companies must be able to sell a decisive amount of products.

Below are proposed prices of "classic" menus, usually consisting of main course, snack and drink, of some fast food restaurants in Italy:

Source: ****

4.4 Product offerings to meet new supply trends

Fast food companies closely follow trends to ensure that their offerings are in line with customers' current tastes and habits. In recent years, the offerings have expanded to match the following trends:

healthier lifestyle: as consumer attention increasingly shifts to healthy lifestyle choices, fast food chains are also deciding to adapt to this new trend, both in terms of product ingredients and product production.[***] As early as ****, we have begun to see an increase in plant proteins alongside animal proteins: in butcher shops, the offerings include new processed products, which will see traditional meats combined with plant-based compounds. New fast food experiences have also spread in recent years, including pokerias, which offer a mix of Hawaiian, Japanese and Italian products made from healthy and sustainable ingredients. In Italy, Flower Burger, Italy's first vegan burger fast food restaurant, was born in **** in Milan, offering sandwiches made entirely from plant-based ingredients. gourmet products: for several years McDonald's has started to offer premium products, belonging to the McItaly category; Italian meats, such as Chianina, Marchigiana or Piemontese, and other IDP or PDO ingredients have been introduced on the menu.[***] sustainable products: customers, and especially the younger generation, are looking closely at farming and grazing ...

5.1 The regulation of the fast food market in Italy

Fast food outlets are part of the broader food service segment and as such are subject to specific regulations regarding the opening of such businesses and their operation. Analyzing the area of food safety, it is necessary to mention theeuropean Regulation **/**/****, No. ***,which establishes rules and procedures to ensure the safety of products for sale.

The Regulation was adopted through several directives, necessary to establish specific health rules for the production and placing on the market of food products These principles form a common basis for the production of all foods, including products of animal origin.

In particular, the regulation takes special account of the following principles:

the primary responsibility for food safety rests with the food business operator ; it is necessary to ensure food safety throughout the food chain, starting with primary production; it is important, for foods that cannot be safely stored at room temperature, particularly frozen foods, to maintain the cold chain; the general implementation of procedures based on the HACCP, together with the application of good hygiene practices, should strengthen the responsibility of food business operators; good practice guides are a valuable tool to help food business operators at all levels of the food chain comply with ...

6.1 Market segmentation

• McDonald's Italia
• Burger King
• Chef Express
• Flower Burger
• Pokeria by Nima
• KFC
• Spizzico
• La Piadineria
• Autogrill