THE AUSTRALIAN FOODSERVICE MARKET

FUTURE IN FOODSERVICESEPTEMBER 11, 2017

AUSTRALIAN FOOD INDUSTRY

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CONSUMER MARKETS

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$115Billion

RETAIL FOODSERVICE

+

$172 Billion

$57Billion

ECONOMIC CONTRIBUTION

5

6

THE FOODSERVICE DOLLAR

In the last two decades Australians have made eating out a way of life. Nearly two thirds of the

population over the age of fourteen eat out

at least once a month.

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THE FOODSERVICE DOLLAR

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EATING OUT A WAY OF LIFE FOR AUSTRALIANS IN CITIES AND IN COUNTRY TOWNS

AUSTRALIANS EAT OUT FOR BREAKFAST, BRUNCH, LUNCH & DINNER

EVEN DURING UNCERTAIN ECONOMIC TIMES…AUSTRALIANS TRADE DOWN IN CHOICE OF OUTLET

AUSTRALIAN FOODSERVICE MARKET

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UNIQUE

AUSTRALIAN FOODSERVICE MARKET

Plethora of Cuisines

Fastest Changing

Food Market

A Market of Independent

Outlets

Huge Variety of Eating Out

Options

Continual Growth

DYNAMIC VIBRANT DIVERSIFIED EVOLVINGUNIQUE

Plethora of Cuisines

DYNAMIC VIBRANT DIVERSIFIED EVOLVING

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OUR NATIONAL FOOD PALATE IS BOLD AND OPEN

NO REAL NATIONAL CUISINE

CUISINE

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1. NEW SOUTH WALES • Sydney centric…diverse & dynamic• Many other large urban areas & cities, wine districts, holiday destinations

2. VICTORIA • Melbourne still the coffee capital of Australia• Tourism critical to regional Victoria and its foodservice market• More of a Southern European dining scene in Melbourne…the

Greeks & Italians

SIX FOODSERVICE REGIONS

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3. QUEENSLAND • Brisbane has developed into a sophisticated dining out market in the past

decade• Regional Queensland still a steak & seafood society

4. WESTERN AUSTRALIA • Perth…an isolated ‘island’• Supply problems linger• The institutional sector ahead of the game• A huge tourist region

SIX FOODSERVICE REGIONS

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5. SOUTH AUSTRALIA • Significant supplier of fresh produce• Still largely reigned by English & German food traditions• Adelaide is not a strong tourist destination in itself

6. NORTHERN TERRITORY • Closer to Asia than the rest of Australia• All about casual dining• Problem of availability and continuity of supply

SIX FOODSERVICE REGIONS

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COMMERCIAL OUTLETS 2017

63,099OUTLETS

9%

2%

1%20%

33%

7%

26%2%

COMMERCIAL SECTOR %

SHARE OF TOTAL OUTLETS 76ANNUAL GROWTH RATE

2016 - 17 3.45

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INSTITUTIONAL OUTLETS 2017

19,540 OUTLETS

10%

2%

1%19%

36%

7%

23%2%

INSTITUTIONAL SECTOR %

SHARE OF TOTAL OUTLETS 24ANNUAL GROWTH RATE

2016 - 17 5

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COMMERCIAL OUTLETS

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INSTITUTIONAL OUTLETS

FOODSERVICE MARKET SIZE

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Title TOTAL MARKET SIZE BY VOLUMEUnits KilosDetail Broken down by product sub-category

Title COMMERCIAL MARKET SIZE BY VOLUMEUnits KilosDetail Broken down by category and commercial channel

Title INSTITUTIONAL MARKET SIZE BY VOLUMEUnits KilosDetail Broken down by category and institutional channel

Title TOTAL MARKET VALUEUnits Wholesale Price in AUD Detail Broken down by product sub-category

Title COMMERCIAL MARKET VALUEUnits Wholesale Price in AUD Detail Broken down by category and commerical channel

Title INSTITUTIONAL MARKET VALUEUnits Wholesale Price in AUD Detail Broken down by category and institutional channel

7 COMMERCIAL MARKET VALUE

8 INSTITUTIONAL MARKET VALUE

4COMMERCIAL MARKET SIZE BY

VOLUME

5INSTITUTIONAL MARKET SIZE BY

VOLUME

6 $19 Billlion

3 2.9 Billion

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MAIN GENERAL DISTRIBUTORS

$7.2 Billion

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AUSTRALIANS TRADING DOWN TO MORE CASUAL EATING OUT EXPERIENCES

CHEFS’ OPERATING ENVIRONMENT

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CHEFS ARE DRIVEN BY…

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the lack of skilled staff both front &

back-of-house

rising food costs

rising utility costs

strongcompetition

CHEFS ARE IMPACTED BY…

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Fine Dining Only 2-3% of

Australia’s total number of restaurants

All foodstuffs made from scratch

Working with sophisticated latest equipment

Passion for the ultimate fresh produce

FULL SERVICE RESTAURANTS

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Upper Middle/Middle/Casual

– replacing fine dining/growing

Pressure to differentiate themselves from competitors – signature dishes

Demanding customers requesting menu changes

FULL SERVICE RESTAURANTS

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Lower End Suburban & Regional –Plateaued but

still vibrant

Less pressure to vary menus – most of the time making their standard fare

Chef often the owner – carries the financial burden

FULL SERVICE RESTAURANTS

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CAFÉS

Not usually a trained chef

Less foodstuffs made-from-scratch

Many menu items made in advance

Coffee no longer the product to rely on

CAFÉS

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PUBS & TAVERNS

Pubs steadily grown in popularity over the past three years – the ‘in’ channel

Many pubs have become gastro pubs

PUBS & TAVERNS

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HOTELS

Functions – private & business - greater importance than the dining room

Great focus on the breakfast meal segment –little on dinner in comparison

HOTELS

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INSTITUTIONAL KITCHENS

Budgetary constraints much greater than in the commercial sector

Majority of back-of-house staff are cooks & kitchen hands

Bulk food offering in most institutions – large food quantities & simpler menus

INSTITUTIONAL KITCHENS

FOODSERVICE EQUIPMENT

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$5 Billion

FOODSERVICE EQUIPMENT

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1.4 million units

installed

LIQUOR IN FOODSERVICE

Red Wine White Wine Beer

211 million 184 million 225 million

Total Number of Glasses per Year

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LAST TWO YEARS…

3

4

2

1

5

34% DECLINE IN NUMBER OF ESPRESSO COFFEES CONSUMED

TEMPORARY DECLINE IN FOOD & NON ALCOHOLIC BEVERAGES

PLATEAUING IN QSR CHAIN VOLUME

SHARP DECLINE IN FOODSERVICE EQUIPMENT INSTALLED BASE

WINNERS: CAFÉS - PUBS/TAVERNS - INDEPENDENT QSRs

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CAFÉ & PUB DINING

3

4

2

HEALTHY EATING STILL ON THE RISE

BREAKFAST & BRUNCH

PARTLY & FULLY PREPARED FOODSTUFFS

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OPPORTUNITIES – IN A GROWING MARKET

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NEW & INNOVATIVE PRODUCTS

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8

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THE RISE & RISE OF THE HAMBURGER

GLUTEN FREE STEADY GROWTH FROM LOW BASE

HOSPITALS & NURSING HOMES

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OPPORTUNITIES – IN A GROWING MARKET

9 HIGHER SUPPLIER MARGINS WITHIN FOODSERVICE

LOOKING TO THE FUTURE

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AUSTRALIA

NEW ZEALAND