Foodservice Market in US to Grow by USD 3.12 Billion (2025-2029), Driven by Increased Snacking and Indulgence Consumption, AI's Role in Market Trends - Technavio

NEW YORK, Feb. 4, 2025 /PRNewswire/ -- Report with market evolution powered by AI - The foodservice market in US size is estimated to grow by USD 3.12 billion from 2025-2029, according to Technavio. The market is estimated to grow at a CAGR of  30.6%  during the forecast period. Increased snacking and indulgence consumption is driving market growth, with a trend towards highly diverse population indulging in ethnic cuisine. However, rising competition from unorganized fast food sector  poses a challenge. Key market players include American Dairy Queen Corp., Chick fil A Inc., CKE Restaurants Holdings Inc., Dominos Pizza Inc., Inspire Brands Inc., Jack in the Box Inc., Marcos Franchising LLC, McDonald Corp., MTY Food Group Inc., Papa Johns International Inc., Penn Station Inc., Pret A Manger, Raising Canes Restaurants LLC, Restaurant Brands International Inc., Shamrock Foods Co., Starbucks Corp., Sysco Corp., The Subway Group, The Wendys Co., Wingstop Inc., and YUM Brands Inc..

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Market Driver

The Foodservice Market in the US is experiencing significant trends, with a focus on vegan, low-sugar, and gluten-free options. Fast food brands and full service restaurants are catering to nutritional diets, offering pancakes, waffles, and toast at cafes & bars. Specialty tea and coffee consumption are on the rise, with digital ordering and international cuisines gaining popularity. Street foods like hot dogs and grilled cheese sandwiches are also in demand. Leading operators are digitalizing their operations, with a focus on on-premise eating experiences, cloud kitchen outlets, and average order value. Chef-driven dining-out restaurants feature professionally trained chefs and celebrity chefs, appealing to the taste and health-conscious consumer. Burritos, chilaquiles, and poke bowls are popular dishes, with e-commerce channel penetration increasing for takeaway and fast food items like burgers, pizzas, sausages, meatballs, and chicken. Consumers are utilizing online booking, online payments, and catering services for packaged food and real-time food delivery. Fast food consumption is influenced by millennial populations and their fast lifestyle, as well as home-cooking and non-traditional food offerings with different ingredients and tastes. Foodservice providers are focusing on organic produce and healthy food options, addressing concerns related to obesity, diabetes, cardiovascular disease, and high blood pressure. Self Service Restaurant, Independent Consumer Foodservice, and Chained Consumer Foodservice are all impacted by these trends, with cafeterias, limited-service eating places, fast-food restaurants, ice cream parlors, beverage bars, carryout sandwich shops, on-premises baking, and food consumption at the forefront of the Food Service industry. Food bars, canteens, universities, vending machines, hotels, virtual kitchens, and ghost kitchens are also adapting to these trends. Veganism and the use of raw materials are becoming increasingly important, with travel and tourism and consumption behaviors also influencing the market. Sugar reduction is a key focus, with coffee shops and bakeries offering K-Cup pods and other low-sugar options. 

The foodservice industry in the US is witnessing a notable trend with the increasing preference for ethnic cuisines. This trend is primarily driven by the growing number of immigrants, particularly from East and Southeast Asian countries and the Indian subcontinent, who have introduced a diverse range of spicy dishes to the American market. With approximately 22 million Asian Americans residing in the US, the demand for these cuisines has seen significant growth. The market response has been favorable, reflecting the adventurous nature of American palates. This demographic shift is set to continue, further expanding the range and popularity of ethnic cuisine in the US foodservice sector. 

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 Market Challenges

• The Foodservice Market in the US is facing several challenges in 2023. Consumers are increasingly demanding vegan, low-sugar, and gluten-free options. Fast food brands and full service restaurants must adapt to these dietary trends to stay competitive. Nutritional diets are also gaining popularity, with pancakes, waffles, and toast being common choices. Cafes & bars serve specialty tea, coffee, and other beverages, with tea consumption on the rise. Digital ordering is becoming essential, with international cuisines and street foods available through online platforms. Leading operators are digitalizing their operations, allowing consumers to order food online and use home delivery systems. Fast food items like burgers, pizzas, sausages, and fried chicken remain popular, but healthier options are in demand. Average order values are increasing as consumers opt for chef-driven dining-out restaurants featuring professionally trained chefs and celebrity chefs. Taste and health-conscious consumers are exploring new dishes like burritos, chilaquiles, and poke bowls. E-commerce channel penetration is growing, with takeaway and fast food items available for online ordering. Consumers use online booking, online payments, and catering services for various occasions. Packaged food service and real-time food service are also gaining traction. Limited-service restaurants, commercial spaces, and self-service restaurants are popular, with independent consumer foodservice and chained consumer foodservice catering to different tastes and lifestyles. Food consumption habits are changing, with millennial populations and fast lifestyles driving demand for non-traditional food offerings using different ingredients and tastes. Foodservice providers are responding by offering organic produce and healthy food options to combat obesity, diabetes, cardiovascular disease, and high blood pressure. Consumption behaviors are evolving, with home-cooking and fast food consumption continuing to shape the industry. The Foodservice Industry is adapting to these challenges, with food bars, canteens, universities, vending machines, hotels, virtual kitchens, and ghost kitchens offering a range of food items and payment procedures to cater to diverse dining behaviors. The industry continues to innovate and evolve, meeting the changing needs of consumers while ensuring a great on-premise eating experience.
• The unorganized fast food sector in the US, comprised of vendors selling from carts and trucks, is experiencing significant growth. This trend poses a challenge to the foodservice market, as these vendors offer affordable fast food options that cater to price-conscious consumers. The presence of diverse consumer segments in urban areas, particularly those with lower income levels, fuels this trend. Consequently, an increasing number of entrepreneurs are entering the fast food industry to meet the demand. This segment's growth is projected to continue, potentially hindering the expansion of the formal foodservice market in the US during the forecast period.

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Segment Overview 

This foodservice market in US report extensively covers market segmentation by  

• Type
• Fast Foodservice
• Restaurant
• Cafes And Bars
• Delivery And Takeaway
• Others
• Solution
• Conventional
• Centralized
• Ready-prepared
• Assembly-serve
• Sector
• Commercial
• Non-commercial
• Business Segment
• Chains
• Independent
• Geography
• North America

1.1 Fast foodservice- Fast foodservice restaurants in the US offer quick and convenient dining options, with many introducing new vegetarian and non-vegetarian menu items. McDonald's and Burger King are among the vendors providing vegetarian burgers, which are gaining popularity due to their health benefits and convenience. Non-vegetarian fast food, such as pizzas, burgers, and sandwiches, is also in high demand due to their protein content and ease of consumption. Vendors like Subway, Chick fil A, Dominos Pizza, Inspire Brands, and Marcos Franchising ensure efficient delivery processes and diverse menu offerings to cater to the increasing demand for fast food services in the US. Despite the presence of online food ordering platforms and third-party delivery companies, the fast foodservice market is expected to grow due to the convenience and variety offered by these vendors.

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Research Analysis

The Foodservice Market in the US is experiencing a significant shift towards healthier and dietary-specific options, with vegan, low-sugar, and gluten-free foods gaining popularity among consumers. Full-service restaurants are responding by offering nutritional menus and customizable options. Online booking and payment systems are becoming standard for reservations and ordering. Packaged food service and real-time food delivery are also on the rise. Foodservice encompasses various segments, including full-service restaurants, quick-service restaurants, and limited-service restaurants. Catering services, food bars, canteens, universities, hotels, and vending machines are also part of this industry. Virtual kitchens are a new trend, allowing restaurants to prepare meals for delivery only, reducing overhead costs. Foodservice industry continues to evolve, meeting the changing needs and preferences of consumers.

Market Research Overview

The Foodservice Market in the US is experiencing a significant shift towards healthier and more diverse food options. Vegan, low-sugar, and gluten-free diets are gaining popularity, influencing menu offerings in cafes, bars, and restaurants. Fast food brands are responding with new offerings, including plant-based options and reduced sugar and sodium levels. Digital ordering and payment procedures are becoming the norm, with e-commerce channel penetration increasing. International cuisines, street foods, and non-traditional dishes like burritos, chilaquiles, and poke bowls are also on the rise. Leading operators are digitalizing their operations, offering online booking, catering services, and real-time food delivery. The average order value is increasing, driven by consumers' desire for taste and health-conscious options. Chef-driven dining-out restaurants, staffed with professionally trained chefs and celebrity chefs, continue to attract diners. Food consumption habits are changing, with millennial populations and fast lifestyles driving demand for convenience and variety. The Foodservice industry is adapting, offering organic produce, healthy food, and self-service restaurants, as well as virtual and ghost kitchens. Food bars, canteens, universities, hotels, and vending machines are also part of the landscape. Consumption behaviors are evolving, with a growing focus on reducing unhealthy products, such as sugary drinks and fried foods, due to health concerns like obesity, diabetes, cardiovascular disease, and high blood pressure. Foodservice providers are responding by offering sugar reduction, low-calorie, and healthy food options. Coffee shops and bakeries are also popular, with K-Cup pods and beverage bars catering to consumers' increasing demand for convenience and variety.

Table of Contents:

1 Executive Summary
2 Market Landscape
3 Market Sizing
4 Historic Market Size
5 Five Forces Analysis
6 Market Segmentation

• Type
• Fast Foodservice
• Restaurant
• Cafes And Bars
• Delivery And Takeaway
• Others
• Solution
• Conventional
• Centralized
• Ready-prepared
• Assembly-serve
• Sector
• Commercial
• Non-commercial
• Business Segment
• Chains
• Independent
• Geography
• North America

7 Customer Landscape
8 Geographic Landscape
9 Drivers, Challenges, and Trends
10 Company Landscape
11 Company Analysis
12 Appendix

About Technavio

Technavio is a leading global technology research and advisory company. Their research and analysis focuses on emerging market trends and provides actionable insights to help businesses identify market opportunities and develop effective strategies to optimize their market positions.

With over 500 specialized analysts, Technavio's report library consists of more than 17,000 reports and counting, covering 800 technologies, spanning across 50 countries. Their client base consists of enterprises of all sizes, including more than 100 Fortune 500 companies. This growing client base relies on Technavio's comprehensive coverage, extensive research, and actionable market insights to identify opportunities in existing and potential markets and assess their competitive positions within changing market scenarios.

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SOURCE Technavio