The value of the Irish hospitality and foodservice market has reached a record €10.4 billion, according to Bord Bia.

The Bord Bia annual Foodservice Market Insights report published today (Tuesday, November 11), shows that the Irish ‘out of home’ sector has increased in value by 5%.

The report noted that much of this increase has come about due to inflation and higher menu prices driven by significant cost pressures in the sector.

The foodservice market includes all food and drink consumed and prepared out of home including restaurants; pubs; hotels; coffee shops; workplace catering; hospitals; education; and vending.

Bord Bia

The research shows that although the sector has been resilient, post-pandemic growth is slowing, and consumer footfall remains mostly unchanged.

Bord Bia sais that operational profitability remains under significant strain, as input costs continue to rise and margin pressures persist.

According to the report, prices on menus are now 26% higher than in 2020.

"Consumers want to go out and eat but many perceive that dining out has become unaffordable.

"This is a significant challenge as the industry is unlikely to see any real growth until menu price inflation is in line with or lower than the general inflation rate," the report added.

Bord Bia said that hotels and pubs continue to show slower recovery than other commercial channels.

There is also an "urban-rural divide" with businesses outside of major towns facing greater challenges and resulting in higher closure rates.

Maureen Gahan, foodservice specialist at Bord Bia, said that many operators still struggle with profitability due to rising costs.

"However, sectors like education catering and events are experiencing sustained growth.

"Future growth will depend not only on pricing, but also on collaboration, innovation, and a renewed emphasis on making foodservice both affordable and enjoyable for consumers," she added.

Opportunities

Bord Bia said that despite the challenges, there are areas of strong performance and emerging opportunities.

The expansion of the Hot School Meals programme in the Republic of Ireland and workers returning to offices drove 15.5% growth in institutional foodservice.

Consumer spending at sporting, cultural and music events remains robust.

Fast-food restaurants and food to go outlets have also outpaced the market by capturing everyday meal occasions and value-conscious consumers.

Collaboration

Bord Bia is projecting further growth of 5% in the industry in 2026, expected to be again driven primarily by inflation.

To overcome shared challenges around labour shortages, wage inflation, and operational efficiency, the report emphasises that collaboration across the supply chain will be critical. "While the operating landscape remains challenging, the outlook is not without opportunity.

"Our research shows that businesses which clearly articulate their value proposition, execute consistently, and strategically target market share can still outperform, even in a low-growth environment," Gahan said.

Foodservice seminar

Over 300 industry representatives and experts are expected to attend Bord Bia's annual foodservice seminar at Johnstown Estate, Enfield, Co. Meath today.

The event will discuss the current challenges and opportunities for Ireland’s hospitality and foodservice sector.

Among the speakers at the seminar will be Pat Sullivan, chief executive Master Chefs; Maxine Hyde, general manager, Ballymaloe Foods; Sean Ryan, foodservice account director, Kerry and Jack Kirwan, co-founder and chief executive, Sprout.