49% of total food dollars spent away from home

By Oregon Department of Agriculture
The typical American consumer now is almost as likely to spend just as many dollars on food away from home as on food prepared at home. Recent statistics show a continuing trend towards dining out as the fast pace lifestyle of today shows no signs of slowing down. Oregon agriculture is poised to provide products to restaurants, hotels, and other sites where food is now being purchased.

“Our food products reach consumers through a variety of ways,” says Katy Coba, director of the Oregon Department of Agriculture. “The latest national statistics show that the restaurant trade and the food service industry are increasingly important customers of what Oregon producers and processors have to offer. That’s because consumers are more often looking outside the home for their meals.”

According to the U.S. Department of Agriculture’s Economic Research Service (ERS), Americans now spend 48.9 percent of their food dollars away from home- the highest percentage on record. Thirty years ago, only about 37 percent of those food dollars were spent away from home. Fifty years ago, that figure was just 25 percent.

The latest numbers don’t surprise Steve McCoid, president and CEO of the Oregon Restaurant Association. He cites other statistics that indicate the average person eats out 205 times a year.

“It’s a commentary on our society and the way it has evolved the last few decades,” says McCoid. “There are more working moms, more two-income families. They don’t have the time to eat meals at home like they used to. So consumers are buying prepared food, orders to go, or are just going out to eat. I don’t think that trend is going to change now.”

The away-from home-food expenditure percentage hovered between 45 and 47 percent for much of the past 15 years, with a few dips and bumps along the way. The percentage actually decreased notably in 2001 following the events of September 11 as more people stayed home and fixed their meals.

McCoid says the trend reflects well on the restaurant industry and indicates a meeting of customers’ needs. Nearly $390 billion was spent at restaurants by American consumers in 2006- the latest year statistics are available from ERS. Combined with a category designated for hotel food service, that represents about 78 percent of all away-from-home food spending. The other 22 percent encompasses food purchased at retail stores and consumed away from home (delis, snack bars, etc.), food purchased at movie theaters, amusement parks, sports arenas and other recreational venues, food from vending machines, and food supplied at schools, hospitals, and military installations.

The $338 billion spent at restaurants in the U.S. is an all-time high. In 1996, that figure was $223 billion. In 1986, it was $121 billion, in 1976 it was $47 billion, and in 1966 it was only $15 billion.

Oregon restaurants offer local growers and processors a major opportunity to cash in on the away-from-home food consumer. The more obvious offerings include such items as Oregon-grown beef in both fast-food and even high-end restaurants, as well as Oregon potatoes and onions used to make french fries and onion rings. More recent menu items include Oregon corn-on-the-cob at Kentucky Fried Chicken, Oregon strawberries and blackberries used in shakes at Burgerville, and Tillamook cheese at several restaurants that offer hamburgers. White tablecloth restaurants also offer local wines and microbrews.

“Serving local foods is a hot deal now,” says McCoid. “You can find these foods on the menu not only in fine dining establishments, but establishments like Burgerville are making it part of their marketing campaign. All this bodes well for local Oregon agriculture.”

Unseen to many consumers are the tastes of Oregon that come in the form of food ingredients.

“Restaurant bakers use Oregon hazelnuts, frozen berries, and flours,” says Laura Barton of ODA’s Agricultural Development and Marketing Division. “Our locally-grown peas and corn also make their way into private label food service suppliers like Sysco and Food Services of America. Condiments should not be overlooked as Oregon grown and produced horseradish and mustards are a food service staple.”

The rising cost of all food may factor into an increased interest in dining out. There is evidence that prices for food purchased for home consumption are rising faster than prices for food purchased away from home. ERS projections indicate the cost of food eaten away from home will be up in the range of 3.5 percent to 4.5 percent this year, while the cost of food purchased for home use will increase more in the 5 to 6 percent range. Still, the American consumer is faring better than past decades when annual increases in food costs reached as high as 9 percent in the 1970s.

“The U.S. consumer is also faring better than their counterparts in many other parts of the world,” says ODA analyst Brent Searle. “Overall food expenditures by Americans is still less than 10 percent of their disposable income.”

Oregonians are now likely to be more thoughtful when deciding where and how to spend their food dollar. It seems the cost of everything is going up, and that appears to be taken into the overall consideration.

“Consumers will continue to look at convenience foods due to busy lifestyles- and carefully scrutinize cost and value, given price increases at the retail value as well the cost of gasoline as they do their shopping,” says Searle.

The bottom line for Oregon agriculture continues to be simple- the product will go to where the market is. No matter where Americans eat their food- at home or away from home- Oregon is growing it and processing it. The trend towards convenience by the consumer means that the state’s efforts to increase value-added agriculture will always be important.

For more information, contact Bruce Pokarney at (503) 986-4559.

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