Operations

IFMA: Fast casual traffic is 'bullish'

Adobe: IFMA

August 6, 2024

Although theInternational Foodservice Manufacturers Association began the year projecting that the food-away-from-home industry would grow .9% in 2024, the organization acknowledged Tuesday in its Segment Projections that the slowing of consumer store traffic was creating challenges, primarily for restaurants, when planning for future consumer behavior. Fast casuals were the outlier, however, showing a bullish growth of 1.3% a positive adjustment compared to the February projection of 0.9%. QSRs, which have performed significantly better in recent years than other segments overall, are projected to grow only by .7%.

"These have been, and we believe will remain, turbulent times for the food-away-from-home ecosystem," IFMA President and CEO Phil Kafarakis said in a company press release. "IFMA stands ready to provide actionable insights, education and peer-group networking opportunities for manufacturers, operators and the supply chain no matter what comes our way. Our forecasts and analysis are made available in detail to our members for them to consult as they plan for the future. We remain committed to bringing reasoned and actionable analysis to the industry."

IFMA has revised its overall 2024 price inflation rates down from 5% in February to 3.8%, reflecting a slowdown in costs of goods sold by food-away-from-home operators.

Consumers, especially lower-income ones, are looking to limit their foodservice spending choices, but the industry's on-site segments, including colleges, universities and healthcare foodservices, remain on track to outpace growth of the overall restaurant segment, according to the report. With the possibilities of declining energy prices and lower interest rates, IFMA expects consumer-led growth to impact 2025, with real growth reaching 1% for the year. The total restaurant category is expected to grow 0.8%, while the total on-site category is projected to grow 1.4%, on a real basis. Inflation for 2025 is projected to be 2%. IFMA will update this forecast in late February 2025.

The International Foodservice Manufacturers Association, a trade association founded in 1952, covers the $1.3 trillion food-away-from-home ecosystem of manufacturers, distributors, operators and others. The IFMA forecast models were created with Datassential, a foodservice research firm, and validated by operators from the five IFMA Foodservice Leadership Councils.