Inflation amongst delivery aggregators grew 6% higher than in restaurants.
Prices amongst the top fast-food chains grew by 19% in June compared to 2022, one percentage point higher than in May, Meaningful Vision’s price tracking data revealed. The Office for National Statistics reported the highest price growth for food and beverages in March and April (around 19%) but from May, the rate of inflation began to slow down. Price trends for fast food are going in a different direction: after a relatively stable first quarter of 2023 with growth in prices of 15%, subsequently, prices went up 18% in May, and a further 19% in June.
Delivery prices demonstrated much higher growth compared to prices in restaurants. Inflation amongst the main delivery aggregators like Deliveroo, Just Eat and Uber Eats was, year-on-year, 6% higher than in restaurants and growing at a faster rate.
“This only increases the initial price disparity. Currently, prices among the main delivery aggregators like Deliveroo, Just Eat and Uber Eats are 20% higher than for the same items purchased directly from the restaurant. And this is without taking into consideration actual delivery costs. Considering this, even greater price increases render delivery less affordable for the low-income demographic amongst consumers, whilst making dining in and takeaway options more appealing,” , CEO of Meaningful Vision, Maria Vanifatova said.
Most chains raised prices for specific items only, rather than applying increases across their entire menu. Over half of the menu items experienced price hikes exceeding 15%. Conversely, only one-fifth of the items suffered inflation of less than 5%. Price rises were disparate across different categories. According to Meaningful Vision, prices for drinks increased only by 12%, whilst food become 19% more expensive.
Amongst the various food categories, breakfast items, sides, and snacks observed the most significant price increases. On the other hand, the main food categories like burgers, sandwiches, various meal/combo offers, and pizza experienced smaller rates of inflation.
Consumers continue to absorb increased prices
Meaningful Vision’s data reveals that traffic in fast food in 2023 is growing despite high price increase numbers. According to Maria, fast food is the main beneficiary in a market where prices continue to grow faster than consumer incomes.
“Customers can use different techniques for savings: visiting foodservice places less often, visiting cheaper places, and spending less. Fast food is gaining new customers who previously went to casual dining and pubs more often. But continuing price hikes are a big challenge for all participants in the market. For the main players, effective promotion and marketing campaigns are becoming the key to highlighting the value, quality, and unique aspects of both products and restaurants, all with the aim of attracting more customers. And, of course, successful promotion strategies rely upon a comprehensive market knowledge and a thorough understanding of what competitors are doing,” Maria added.