5 Hot Trends in Food & Beverage Retail — and How to Keep Up with Them

As a food and beverage retailer, you have a lot going for you.

For starters, your business likely sees high transaction counts per month. In Vend’s recent Retail Benchmarks Report, we found that beer & wine retailers process an average of 963 transactions per month, while beverage manufacturers and specialty food merchants see an average of 806 and 589 monthly transactions respectively. (The overall average for retailers in general is 482 transactions per month.)

F&B retailers also see larger basket sizes. While most retailers have an average of 2.73 items per sale, F&B retailers have basket sizes ranging from 3.39 to 3.77.

Moreover, as the demand for experiential retail continues to grow, shopping centers and malls are increasingly investing in dining and entertainment. As an F&B retailer, you’re in a great position to capitalize on this movement.

However, it also means that competition is heating up, and staying ahead requires a keen eye on today’s F&B trends. If you’re not too sure of what to watch out for, here are 5 food and beverage retail trends to get you started.

1. Picture-perfect stores and products will have a huge leg up

The folks at Adweek said it best: “These days, if consumers can’t Instagram a store, it’s almost not even worth going.”

It’s a blunt statement (and an exaggeration) but they make a solid point.

More and more of today’s shoppers are doing things “for the ‘gram.” They’re attracted to beautiful retail spaces where they can take photos and document their experience on social media.

As a F&B merchant, you can capitalize on this trend by serving food and drinks that are as beautiful as they are tasty. Depending on your store, you may want to invest in photogenic plates and utensils, as well as props that your customers can photograph. You could even take it a step further by setting up an Instagram wall that patrons can pose in front of.

Have a look at what Cauldron Ice Cream is doing. In addition to serving rose-shaped scoops of ice cream (that alone isn’t something you see everyday), Cauldron has a cheeky wall with the words “It’s not gonna lick itself” written on it. The wall is a magnet for user-generated content, and Cauldron cleverly uses it in their social and marketing content.

2. Non-food retailers may enter the space

Don’t be surprised if you see traditional apparel or accessories retailers enter the F&B space. As a response to the dining and entertainment trend we mentioned earlier, merchants across various retail categories are looking to enhance their in-store experiences by serving food and drinks.

Take for example, Tiffany & Co., which opened a restaurant called the Blue Box Cafe on the 4th floor of its New York flagship store. The move, which is part of Tiffany’s strategy to lure younger consumers to its brand, seems to be working. Andrea Davey, the company’s senior vice president of global marketing, told CNN that the Blue Box Cafe has upto 4,500 tables on its wait list on any given weekend.

Needless to say, as an F&B retailer, this trend is one to watch — particularly if you start seeing more retailers offer products similar to the ones on your menu.

3. Mobile ordering will continue to permeate the retail industry

Ordering food using your phone is nothing new; people have been calling in their pizza orders for years. But thanks to our smartphones, mobile ordering has reached a whole other level, and retailers who are capitalizing on it are already reaping the benefits.

According to Business Insider, “Taco Bell sees 30% higher average order values on mobile compared to in-store, and Starbucks’ Mobile Order & Pay already represents 10% of total transactions at high-volume stores, directly contributing to increased company sales.”

This trend won’t slow down anytime soon. BI Intelligence expects mobile order-ahead volume in the US to reach $38 billion in 2020, which means that it will comprise almost 11% of total QSR sales.

In a similar vein, mobile delivery services are also booming. PYMNTS reports that overall food delivery sales increased 51% from August to March of 2018.

Mobile ordering could very well be table stakes in the near future, so if you’re not offering the service yet, it’s high time to do so.

Fortunately, services such as UberEats and Postmates are making it easy for retailers to implement mobile ordering.

Consider the case of Grain & Vine, a boutique wine and spirits store in New York. In addition to selling in-store and online, Grain & Vine also offers same-day delivery through apps such as Postmates, Minibar, and Drizly. They do this by tightly integrating their POS system (Vend), payments processor (Square), ecommerce store (Shopify), and mobile ordering services, so data flows smoothly from one platform to the next.

In other words, their systems can “talk” to each other and share data in real-time, so when orders come in, Grain & Vine’s inventory is synced across its physical and digital stores. As for the different delivery applications, Grain & Vine owner Michael Nagdimunov says they use an XML file to sync their inventory with the apps.

“We’ve created an XML file that constantly pings our Shopify platform for inventory updates. And because Shopify and Vend integrate almost natively, both inventories are always in sync. Those XML files are then being sent to our providers [i.e. delivery apps] and they, in turn, have constant access to updated inventory. That way, we’re never in a situation where they sell something we don’t carry.”

If you’re going to implement multi-channel ordering, take a leaf out of Grain & Vine’s playbook, and choose platforms with tight integrations. To make things easier, go for solutions with existing integrations, so you won’t have to develop one yourself.

Further Reading

To learn more about the processes and tools that  Grain & Vine — and other food and drink businesses —are using to provide better customer experiences and be more efficient, check out Vend and Square’s guide on maximizing retail productivity.

Learn More

4. Expect a bigger focus on ethical and sustainable products

Consumers are increasingly gravitating towards ethical and sustainable products and business practices.

According to the Euromonitor International’s Passport Ethical Labels database, the sales of F&B products relating to environmental sustainability reached $196.8 billion in 2017. Meanwhile, F&B products whose labels detailed human sustainability criteria stood at $181.6 billion.

Euromonitor forecasts more growth in the sustainability front. “Our data shows that retail value sales of packaged food with an ethical claim will increase year-on-year by 4% in the US between 2018 and 2020 as increased awareness, availability and affordability continue to drive consumer interest in ethical food purchases,” Euromonitor ethical labels analyst Trishna Shah told just-food.com.

What does this mean for you?

If your business is already big on ethical and sustainable practices and products, make sure your customers know about it. Mention your initiatives on your packaging, website, receipts, and in-store collateral.

Starbucks, for example, donates its unsold food products to charity, and it has signs in its stores letting guests know about their giving program.

[my local Starbucks does this. I’ll swing by and take a photo]

5. Personalization will have its place in the F&B industry

Personalization has taken various retail categories by storm, and the food & beverage sector is no exception. RetailWire cites a YouGov survey, which found that 26% of Americans have purchased a personalized product “either for themselves or someone else,” and F&B was among the core five personalization categories for shoppers.

It appears that today’s consumers are going beyond buying customized apparel and accessories — they want their food to be tailored to their specific needs, too.

How can you adapt to this trend? That depends. Personalization can come in many forms. For some merchants, this could mean tailoring your products or ingredients for specific diets (e.g. vegan, Paleo, gluten free, etc.). For other F&B retailers, customization could mean letting shoppers “build” their meals, similar to how Chipotle lets customers create their own burritos.

Have a think about how you can provide more personalized products and experiences in your store, and test it out to see how consumers respond.

Final words

Adapting to this new and more competitive retail landscape is no piece of cake. Depending on where your business is at, keeping up with today’s consumers may require an investment in new technology, a big shift in your processes, or even an overhaul of your company culture.  

Whatever the case, you need to act quickly. The F&B sector (and retail in general) will only get more competitive, and in today’s world, being nimble is key to survival. As Jeffrey & Bryan Eisenberg said in their book, Be Like Amazon: Even a Lemonade Stand Can Do It!, “The big fish aren’t eating the small fish… The fast fish are eating the slow.

Further Reading

Need help running a food and beverage industry that’s ready to keep up with these trends? Vend and Square recently published a productivity guide specifically for F&B businesses. Titled How to Maximize Productivity in Your Food & Beverage Storethis guide will shed light on:

  • Proven processes to help you get more done in less time
  • The latest tools you can use in your food and drink business to maximize productivity
  • The formulas and cheat sheets for measuring your store’s performance

Learn More

About Francesca Nicasio

Francesca Nicasio is Vend's Retail Expert and Content Strategist. She writes about trends, tips, and other cool things that enable retailers to increase sales, serve customers better, and be more awesome overall. She's also the author of Retail Survival of the Fittest, a free eBook to help retailers future-proof their stores. Connect with her on LinkedIn, Twitter, or Google+.