The Trends to Watch in 2022 & Beyond

The Changing Face of Food & Hospitality.

Towards the end of each calendar year, we like to take a look back at how the industry has shifted, the trends that have taken off, and try to pre-empt the future face of the industry. This year we are embarking on the same assignment, however with the impact Covid lockdowns have had on the industry, especially in Melbourne, and to a lesser extent Sydney, we know that the future face of the industry may have been changed forever.

As we have endured the past 18 months of the pandemic it is not accurate to say that Covid-19 has influenced the trends we will see and experience in the near future, as many trends were already starting to gather momentum, the pandemic has however accelerated their inevitability.

The future is about many things, including being digital, humanistic, local, healthier, authentic, greener, caring etc. etc.  The list goes on and on…   

From a Food and Hospitality business perspective, over the past twelve months we’ve analysed those trends that will influence many key strategic and operational decisions pertaining to how we plan, execute and view food, beverage, hospitality, entertainment, and associated disciplines, and how we can use these insights to help us with our decision making for a better outcome for the projects and the people we connect with in our work, home and community lives.

With the pandemic starting to ease in some parts of the country and lockdowns becoming a thing of the past (hopefully), 2022 brings some cautious optimism to the industry as businesses start to see light at the end of the tunnel.

There have been evident changes in consumer preferences relating to safety, supporting local, food choices, service expectations and the utilisation of technology, that throughout the pandemic has led to many businesses fast-tracking innovative strategies in operations, new product development, marketing, and analysis, forming new trends in the industry.

Whilst some food and hospitality businesses chose to pivot their businesses early, out of necessity, others have elected to respond to changes in consumer preferences and are quickly reshaping the food and hospitality landscape in front of our eyes.

The core categories that we see being influential 2022 and beyond are not necessarily new to the industry, however the amount of focus they receive will be game changing:

Technology

The Food & Hospitality industry has traditionally been slow to adopt technology solutions, but the COVID-19 pandemic has notably hastened that and forced food and beverage businesses to look beyond the conventional. We have seen the necessity for many to adapt or die in a fast-changing landscape and this could just be the beginning of how tech will shape the future of the industry.

  • Online ordering, self-checkouts, touchless payments, food delivery and pick-up will continue to propagate as the demand for off-premise consumption continues to grow.

  • Less human interaction will advance the involvement of robots in food preparation, service and delivery, prompting enhanced labour and operational efficiencies.

  • Reduced in-store transactions will continue to drive the evolution of Dark Kitchen, Dark Bars, Dark/Virtual Food Halls, the list is endless when it come to the delivery of food and beverages from low cost ‘fulfilment’ centres. 

ME&U contactless ordering

Robot Technology

Repurposing

It has been inspiring to see the commitment of modern food and hospitality operators in minimising their impact on the environment, through the reduction in food and equipment waste across the sector. The impact of snap lockdowns has organically grown the dependency on food rescue and repurposing organisations like OzHarvest, Foodbank and SecondBite, to redistribute unrequired foods to those in need.

It has also been refreshing to see a push from large companies introducing policies that mandate their future food and hospitality related projects to demonstrate how materials, equipment and basically anything that can be reused is, in an attempt to use and repurpose the raw materials and reduce cost.

Modern Menus

The humble menu has had a thorough overhaul in the past two years and as businesses are reopening, we are seeing the emphasis that has been placed on menu flexibility, pricing, structure, and menu size.

  • Menu pricing structure has progressed to provide greater value to customers, as expectations change in the true meaning of ‘value for money’

  • Promotional pricing and ‘day of the week’ pricing that has been commonplace in pubs and clubs has merged its way into restaurant dining, as operators are seeking strategies to maximise their F&B revenue across early and mid-week, in response to restrictions on capacity numbers during peak weekend periods.

  • Menus and food designed to travel. The uprise in delivery has manifestly changed chef’s thinking and influenced menu development. Dishes that can travel, that don’t spoil in their packaging and are highly presentable after their journey are prized by the modern restaurant and customer alike.

  • Shorter, more defined menus that are less labour intensive, more cost effective and contain more sustainable and locally sourced produce are becoming a clear focus of the modern menu.

Day of the week Specials

Food Focus

The food choices we as a society are making and the food our bodies are craving will continue to shape the food landscape and influence the trends for the coming years. Healthy choices, food that nourishes and plant based diets for our overall health and the health of the planet will continue to rise.

  • The price of meat (especially beef) is swaying consumer decisions and proving an evident correlation between this and plant based consumption.

  • The cost of meat, as in the environmental impact and physical cost of production is influencing customers and changing long standing consumption habits.

  • The choice to reduce meat consumption or ‘Reducetarianism’ is becoming a significant trend that is shaping restaurants and menus across the world, as customers are challenging themselves to reduce their meat consumption and seek alternative food options.

  • Fresh, local, sustainable, ethical and seasonal will continue to be in fashion and shape most good menus we peruse. This is not new and this is not the last year this will appear in this forecast, but it shows that this trend is here to stay

Sustainability

Climate change, zero emissions and waste reduction are all key environmental considerations that are trending across all media platforms and effect all industries; however the food and hospitality industry is a prime contributor to all of these. How the food and hospitality sector shifts its focus and steps up to its responsibilities will be a major focal point and trend in the coming years.

  • Reduction in the reliance on gas as the primary cooking fuel will see many food businesses change their preferences and shift towards more environmentally sustainable cooking systems. Many new Government, University and Mixed-Use developments are already going down this path and food operators are being urged to develop forward thinking strategies to adapt to this effort.

  • Compostable and Biodegradable packaging has been and remains to be one of the most highly recommended environmental solutions in the food sector and welcomed by many food retailers, however an ultimate push towards a reduction in disposables, full stop, may be the stimulus for greater uptake in reusables and returnables.

  • Waste reduction across all waste streams will become a greater focus as recycling rules change and operators are forcing suppliers to rethink their product distribution methods. Zero plastics, reusable crates, naked packaging and alternative collection methods will become more prominent as the industry as a whole aims to reduce its footprint.

  • Continued hyper-localisation of supply chain - buying local from smaller producers, in the face of continued international supply chain disruption.

Commercial Contracts/Terms

Opening new businesses and dictating terms of contractual matters has shifted in favour of the tenant and is changing the landscape as to how we negotiate terms.

Landlords and agents are more forthcoming with their preference to secure a tenant over lucrative financial and long-term contracts becoming widely recognised. The retail vacancy rate (supply) and lack of adequately financed operators (demand) in the market is impacting the industry and forcing the sector to think differently about expectations and priorities.

  • Lower asking rent, more regularity of turnover rent (not just in shopping centres) and significant landlord contributions and rent-free periods are just a few of the inducements that we will see more consistently, as operators have greater control and plan to protect their future feasibility in the face of continued uncertainty.

  • Flexible lease terms and short-term options to fill current vacancies, as a response to short term solutions for long term gains.

  • The materialisation of elevated new fit outs due to less asking rent and longer rent free periods, allowing operators more opportunity to allocate their capital on look and feel and design-led outlets, raising the bar for the food and hospitality industry.

Lifestyle Centres

The uptake of online shopping, whilst prevalent pre-covid, has boomed over the past 2 years, across both general retail and food and the shopping centre landscape is transforming in front of our eyes. ‘Experience-Led’, not ‘Product-Led’ centres are rapidly emerging as customers demand different experiences and new lifestyle centre interactions.  

  • Bricks and mortar food and hospitality will establish itself as the major driver of visitation to centres big and small and drive daytime and evening spend to activate precincts around the country.

  • ‘Eat’- Entertainment or experience led food, hospitality and entertainment interactions are in high demand and are forging the future of food and entertainment precincts around the world. Experienced based, social and fun, responding to market demands and creating unique points of difference in the industry.

  • Hotels, restaurant precincts, lifestyle solutions, recreation/fitness centres and general services are emerging to consume significant floor space in centres that were historically fashion and retail focussed, as the demand for suburban precincts and destinations are on the increase.

  • Food is the future and the stimulus of our future local shopping/lifestyle centres. It will be the catalyst for change and the answer to the challenges many landlords are facing.

  • The restaurant industry is preparing for significant revenue growth as we enter the post covid world and lifestyle centres, dining precincts and mixed use developments are planning to use food and restaurants as an anchor to safeguard their future success.

Ibis World Report: Restaurants in Australia, 2021

Convenience

The growth of convenience is being driven by consumer expectation and the amenity that delivery apps and new food businesses have supplied to the industry. The competition for the customers dollar is fierce and food operators are being forced into proactive thinking and new convenient solutions to win the customers spend.

  • Home delivery meal boxes – bringing restaurant quality meals to your home is now a regular occurrence for many and will continue to shape the dining landscape as we know it.

  • Suburban and regional outposts from some of the best operators in the market, seeking customer loyalty and following and less reliance on historical CBD revenue generation.

This is just a snapshot to the future that lies ahead of our industry and there is plenty more to come. Lockdowns may pause physical progress but, time has proven, they can spark even brighter, bolder plans.

Every crisis has its silver lining. The COVID-19 pandemic may have disrupted ‘business as usual’ and forced some drastic changes upon the food and hospitality industry, but this disruption has also awoken many F&B professionals to an opportunity to accelerate tech trends, fast-track change and re-imagine restaurants.

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