US foodservice and food retail: Mixed signals depending on who you ask - Q3 2024 update

Data on credit and debit card transactions from Earnest Analytics shows mixed signals for foodservice and food retail spending in Q3 2024. Foodservice traffic continues to drop as menu prices rise at a rate well above food-at-home and overall inflation. However, some pockets of growth can be found in certain fast-casual chains – namely those that offer affordable international cuisine or chicken sandwiches and strips. Despite being cash-strapped, consumers still enjoy trying new and exciting foods, which is not mutually exclusive with affordability.

Consolidated data for food retailers points to ongoing declines in traffic and basket sizes, despite continued growth in discounters and wholesale clubs. A more careful analysis reveals that non-essential items, and non-food items are dragging down results for big-box stores. We conclude that food retailers with a streamlined value proposition, such as those focusing on bargains or premium offerings, have either thrived or at least sustained themselves during these inflationary times by meeting the needs of their specific audiences.