Britain’s fish and chip industry grew +1.1% in the year ending September 2013 but faces heavy competition from fast food brands in £11bn market

New foodservice industry figures from The NPD Group Inc, a global information company, show that Britain’s fish and chip shops saw a small increase in total spend (sales) of +1.1% to year ending September 2013.  Consumers are now spending an average of £3.20 per person each time they visit their local chippie.

But will Britain’s chippies struggle to survive as they compete with the fast food giants and other chains? Fast food has done well in the recession as people trade down to the cheaper channels when eating out. The British fast food market (which includes burger chains, chicken shops, kebab shops, takeaways, chippies and pizza deliveries) is now worth £11.4bn in Britain - that’s 23% of the total out-of-home (OOH) eating industry. Brands account for 50.4% of traffic and 50.6% of sales in the fast food market and they’re growing. These figures are up +1.9% and +3.3% respectively over the last year, and saw double digit growth since 2008.

Chippie challenges?

The independent outlets selling fish and chips need to offer quality and good prices if they are to beat off the fast food brands. ‘Quality of food’ has increased in importance this year with 24.5% of fast food consumers saying this was a reason for choosing a particular place to eat (up from 22.6% last year). 28.7% of consumers cite ‘good price’ as a reason for choosing where to eat in the fast food market – up significantly from 9.7% in 2008.

Guy Fielding, Director of Business Development for The NPD Group, said: “The independent chippies will need to fight hard to compete with the might of the big chains in terms of promotions and overall marketing activity. Our chippies need to think ‘family’ and attract adults with their kids, offering real value rather than just cheap food at low prices. But despite our love affair with fish and chips, survival isn’t guaranteed. Many of the chain competitors selling burgers and chicken directly over the counter are offering great family deals, something that is not replicated in the chip shop channel. You can feed a family for £12 at a fast food chain – can the same be said for the independent British chippie?”

How can chippies fight back? 

There are three big motivations for eating out at fast food restaurants that can easily work in the chippie’s favour: 

• Convenience: 39.5% of fast food consumers cited this as a reason for where they choose to eat out (YE Sept 2013). Fish and chip shops would do well to emphasise convenience because they can serve fresh, hot food quickly, and they typically serve a local and often loyal catchment area that’s close to the outlet.

• Family dining: People are going out to eat less often, but it has become more of a special event. ‘Spending time as a family’ has increased in importance every year since 2008 – with 11.2% of fast-food consumers citing this as their motivation to go out and eat now vs. 7% in 2008. Fish and chip shops can underline their family appeal more.

• Treat yourself and the kids: The desire for a ‘treat’ was the motivation to eat out for 22.7% of fast-food consumers (YE Sept 2013) vs 19% in 2008. Do consumers feel a visit to their local chippie is a ‘treat’?

Guy Fielding says: “If chippies can tap into the current food service trends within their local community – convenience, family dining, honest, quality food and value – then they have a chance of survival. Playing the local card will be key.”