It might behoove supermarkets to serve up more—and cheaper—foodservice options catering to families, restaurant research findings from consumer credit giant TransUnion show.
Nearly one in four households with children (24%) said they are dining out or ordering food more often, according to TransUnion’s “2023 QSR and Dining Report,” released Tuesday. Similarly, 29% of households with kids plan to boost their restaurant spending.
TransUnion’s study, based on a survey of 1,564 adults conducted with research firm Dynatakey, found that parents’ return to in-office work is a key driver of increased restaurant spending by families, cited by 40% of households with children.
Still-elevated prices at the supermarket are steering families toward restaurants as well. In TransUnion’s research, 38% of households with kids named high grocery pricing as a reason for dining out or getting takeout food more frequently.
“Household composition is very influential on how often consumers dine out or order in,” Cecilia Seiden, vice president of the travel and hospitality business at Chicago-based TransUnion, said in a statement. “Consumers with children are much more likely to rely on restaurants to help feed their families—and returning to offices is increasing the need for easy and fast dinner options.”
Interestingly, the strong consumer interest in restaurant versus grocery food comes amid changing inflation trends.
The overall the Consumer Price Index (CPI) for food—including food-at-home and food-away-from-home—grew 3.7% year over year for September and edged up 0.2% month to month, the U.S. Bureau of Labor Statistics reported. Of that, the September food-at-home component inched up only 0.1% on a monthly basis and was up 2.4% annually, the latter marking a more than yearlong decrease.
Meanwhile, on the restaurant side, inflation has declined but held at high levels versus a year ago. The food-away-from-home index was up 0.4% in September—higher than recent upticks of 0.3% in August and 0.2% in July—but stood at a gain of 6% year over year, continuing a mostly downward trend since the start of 2023.
“Recent food inflation has ripped through the economy with food at home (aka grocery store) prices rising much faster than food away from home (dining out),” TransUnion stated in its report. “This may have provided consumers with extra motivation to dine at quick-service restaurants, as they’ve become a better relative value. Beginning in the summer of 2022, this trend has reversed, as the cost of eating out is declining at a much slower rate than groceries.”
Even with changes in pricing dynamics, heading into the end of 2023, 64% of consumer households polled said they plan to spend at the same levels at restaurants as they did in the second and third quarters. For 58% of consumers, that translates to dining out or ordering once or twice weekly and spending less than $150 per week. However, TransUnion noted, households with children were more likely to go to restaurants—three to four times a week—with more than half planning to spend $150 to $500 each week on dining out.
Overall, 19% of households expect to spend less at restaurants, while 17% expect to spend more—with the issue of cost influencing both choices, TransUnion found. Among the 19% of households expecting to spend less on restaurants, 81% cited high prices as a reason for cutting future spending. And on the flip side, for the 17% of households expecting to spend more on dining, 59% said higher restaurant menu prices would drive the increased expense.
“Beyond the primary driver of higher prices, one-third (33%) of households said they were scaling back restaurant spending due to a desire to eat healthier, while just over 20% said they expected to have more time to cook at home, perhaps as they exited the busy summer season,” TransUnion said in its report.
Households with children exhibited a greater propensity to look for less expensive restaurant choices. Of these households, 19% would lower restaurant spending by searching for cheaper options, and 38% would eat at less expensive restaurants or order less expensive menu items. TransUnion’s research also revealed that households with kids also are keeping an eye on their pocketbooks: 23% said they eat out less frequently because of the state of the economy.