Americans’ Spending on Dining Out Just Overtook Grocery Sales for the First Time Ever

This is from last year, 2015.

This reminds me of how people didn’t really go out to much until women started to enter the workforce.  More time working and less time and energy to cook.

Now we have the employed working even more to pay their bills, which is made worse by the increased costs of living.  On the other side, workforce participation rate is lower than 2008.

Grocers have seem to be making the shift to more ready to eat meals to help compete with consumers desires.

From a mathematical / statistical view, a meal at a restaurant can cost around $10 on the lower end and a meal at home from groceries could cost half that, say $5.  Lets see what we get if someone over the span of 10 days a person eats out half the time.

10 days equals 30 meals

15 * 10 = $150 eating out

15 * 5 = $75 eating at home

Lets now look at eating out 30% of the time.  That’s eating out almost once per day.

9 * 10 = $90 eating out

21 * 5 = $105 eating at home

So basically by people eating out over 30% of the time, you can see how restaurant speeding could be higher.  And we can see that a lot of people are eating out every day.

Companies like Hello Fresh, where a ready to cook meal if mailed to you, seems to be almost a middle ground.  Instead of taking the time to go out and wait for you meal to be made, you just spend time cooking you meal and no time at the grocery store.  Time is becoming more scarce.

From Bloomberg

By Michelle Jamrisko

April 14, 2015 — 11:11 AM EDT

Pass the menu, hold the shopping cart.

Grocery stores are finding it harder to make headway with shoppers as a surge in spending at restaurants over the past several months signals Americans are more likely to ditch the brown bags in favor of doggy bags.

Sales at restaurants and bars overtook spending at grocery stores in March for the first time ever, according to Commerce Department data released Tuesday that dates to 1992.

An otherwise fairly unremarkable retail sales report offered some insight into the evolution of American eating habits, hinting at a generational shift that already has restaurants thinking about how to cater to those growing ranks of millennials.

That younger cohort has been identified as being more willing to spend on “food away from home,” according to a November report from Morgan Stanley.

Source: Morgan Stanley

And the National Restaurant Association has caught on. The food services trade association that boasts almost 500,000 members is focused on how to cater to the army of young folks that are set to overtake the baby-boomer generation this year.

“Millennials view dining out as a social event (i.e. a chance to connect),” the Restaurant Association advises on their website. “They tend to favor fast food, deli food and pizza restaurants over coffee shops, high-end dining and casual dining. Their diversity and interest in new things draw them to more ethnic restaurants too.”

At the same time, older Americans have been expressing less of a willingness to spend on dining out while funneling more cash toward those grocery trips. The share of 51- to 69-year-olds who said they are spending more on groceries compared with a year earlier outstripped those who said they are spending less by 45 percentage points, according to a Gallup survey conducted Nov. 10-20. The share of those baby boomers spending more on “dining out” was smaller than those who said they were purchasing less at restaurants and bars, by 10 percentage points.

There is one caveat with the data that should ease concerns consumers will increasingly rely on restaurants for their daily meals. Retailers such as Wal-Mart Stores Inc., Target Corp. and Costco Wholesale Corp. also offer grocery items in their stores, yet they’re not tallied in the Commerce Department’s grocery-store category. They’re listed under “general merchandise retailers,” which showed a pickup in sales last month, while still not yet making up for the winter slump.

Historic Chart of the Day

Based on today’s Census Bureau report on April retail sales, consumer spending at “Food Services and Drinking Places” (restaurants and bars, see red line) was greater than grocery store sales (blue line) in April for the third straight month, reversing a longstanding pattern of food spending and establishing a new US consumer milestone. As the chart above shows, the spending habits of Americans over the last three months represent the first time in US history that spending on food away from home by Americans has exceeded spending on food at home. In April consumers spent $51.25 billion on food and beverages at restaurants, which was almost $1.5 billion (and about 3%) more than $49.77 billion in grocery store sales for the month.

Americans Are Spending More To Dine Out Than On Groceries For The First Time