Robotics in Food Service

Part
01
of three
Part
01

Food Service Market Size (Business and Industrial)

The market size of non-commercial food services market specific to business and industry is $16.0 billion.



  • As of May 2017, the market size of non-commercial food services market specific to business and industry is $16.0 billion.


Break down of the non-commercial food services market in the U. S.


Additional information

  • The food service market as a whole is valued at $766 billion, according to Statista. According to the MAFSI food service market report, the size is $761.2 billion.
  • The Restaurants and Bars Food Service market is valued at $494.3 billion.
  • The Retail Food Service market size is $66.5 billion.
  • The Travel and Leisure Food Service market is valued at $79.656 billion.
  • The other food service markets are worth $4.2 billion.
  • The total US Non Commercial Food Service market size equals $116.6 billion.
  • The CAGR for the US Food Service market is 5.56%, over the period 2019-2023.

Part
02
of three
Part
02

Food Service Market Size (Colleges and Universities)

The total expenditure on food in the U.S. was $1.71 trillion in 2018 and 54.4% of this amount went to food-away-from-home, which translates to $924.8 billion. As colleges and schools had a 7.9% share in the food-away-from-home market segment, its market size is estimated to be worth $73.48 billion. Below is an overview of the findings.

FOOD INDUSTRY OVERVIEW


COLLEGE AND UNIVERSITY FOOD SERVICES

  • As students have a busy academic and social life it is convenient for them to eat out. This is why more colleges and universities are making provision for student dining spaces than ever before.
  • While some cafeterias are run by the institution, some have opted to contract the dining spaces to outside firms to improve on the attractiveness of these eating spaces.
  • They also have to diversify their meals and compete with outlets operating just outside the institution.
  • Restaurants and food outlets in colleges and universities depend on the student population. It means that the size and financial health of the non-commercial food sector in colleges and universities is determined by student expenditure.
  • The average expenditure on food for a student depends on the location of the campus and the food choices made. For example, Wellesley College charges $3,495 each semester for a decent meal plan while Texas A&M quotes $2,305. Auburn is even cheaper because a student can feed themselves the entire semester with just $995.
  • The discrepancies mean that the industry is clearly segmented but equality lucrative.

MARKET SHARE FOR DIFFERENT FOOD OUTLETS

  • When looking at the non-commercial food industry in colleges and universities, one must take into account that schools run in semesters.
  • There are also prolonged periods when students are not on campus and restaurants do not operate in these periods.
  • A student's disposable income is another factor that affects pricing. Still, the high populations keep the numbers high and growing for outlets based in schools.
  • While expenditures on food-away-from-home have grown over the years, the share taken by different outlets has not changed much over the last two decades.
  • Full-service restaurants have maintained 35.8% of the market.
  • Limited services restaurants have increased their share from 33.3% to 36.1% in 20 years.
  • The market share for schools and colleges has declined from 8.5% in 1997 to 7.9% in 2017.
  • Food furnished and donations fell from 6.8% to 5.1%.
  • Hotels and motels lost 0.6% and currently stand at 4.2% from the 4.8% they previously had.
  • Retail stores and vending grew their portion from 3.8% to 4.2% with recreation facilities adding 0.3% thus increasing their 3.3% share to 3.6%.
  • Other outlets lost 0.6% and dropped to 2.6% from 3.2%.

MARKET SHARE FOR COLLEGES AND UNIVERSITIES

  • Total expenditure on food in the U.S. was $1.71 trillion in 2018 and 54.4% of this amount went to food-away-from-home. This translates to $930.24 billion. [see calculations below]
  • If colleges and schools took 7.9% of the food-away-from-home expenditure, the market size was worth $73.48 billion. [see calculations below]

RESEARCH STRATEGY

Information about food consumption is diverse. In an attempt to find the size of the non-commercial food services market specific to colleges and universities, we looked at factors connected to the non-commercial food industry like student expenditure and food-away-from-home statistics. With recent data about consumption in the U.S., we calculated a specific figure for the non-commercial food industry by looking at the overall expenditure on food ($1.71 trillion), taking 54.4% of it to cover for the food-away-from-home (FAFH) segment ($930.24 billion) and finally considering the 7.9% of the FAFH expenditure which is taken up by schools and colleges. We assumed that the market share for schools and colleges in 2017 (7.9%) remained the same in 2018. This gives a final figure of $73.48 billion as the size of the non-commercial food services with special attention to colleges and universities.

CALCULATIONS
Market size non-commercial food industry 2018 = $1.71 trillion
Market size food-away-from-home segment 2018 = 0.544 x $1.71 trillion = $930.24 billion
Market size college food-away-from-home segment = 0.079 x $930.24 billion =$73.48 billion
Part
03
of three
Part
03

Robotics in Food Delivery

PepsiCo and Anheuser-Busch are two examples of CPG and CSD companies that are utilizing robots in the delivery of their products. Detailed below is how robots are being used in delivery in each of these companies.

PEPSICO: HELLO GOODNESS SNACKBOT

  • Since most customers are looking for convenient ways to buy items using their smartphones, PepsiCo launched its first self-driving robot that delivers snacks to the students of the University of the Pacific in Stockton, California.
  • Students can order snacks via an app on their smartphones, which will be delivered by a six-wheeled delivery bot called Snackbot to more than 50 locations inside the campus.
  • Snackbot is still in its early stage with only three robots and three workers on the campus that refill snacks and replace batteries.

ANHEUSER-BUSCH: SELF-DRIVING SEMI TRUCKS

  • Anheuser-Busch, an American brewing company that owns a variety of beer brands, has placed a reservation for 40 self-driving trucks from automobile manufacturer Tesla. The main goal of this project is for the company to reduce its carbon footprint by 30%.
  • In 2016, the company launched its first driverless delivery in partnership with Uber.
  • The self-driving trucks can travel to up to 300 to 500 miles depending on its battery capacity and can hold to up to 51,744 12-ounce cans of Budweiser or Bud Light.

RESEARCH STRATEGY

To determine five CPG or CSD companies that are utilizing robots in the delivery of their products, we started our research by looking for pre-compiled lists of companies that use robots in their delivery system. The idea was to go through any found lists and pick those companies that belong to the CPG and CSD spaces. Using this strategy, we found PepsiCo's Snackbot. The rest of the companies we found that use robots in their delivery system were carrier, mobility, and robotic companies. Although there were CPG and CSD companies mentioned, they use robots in their production and packaging, not delivery, so we did not include them in our findings.

Since most of the sources we found using the first strategy cited autonomous or self-driving vehicles in delivery services, we directed our research on this path. We looked for CPG or CSD companies that utilize driverless vehicles in their delivery through leading media publications, press releases, and websites dedicated to technology, supply chains, and consumer goods. However, we only found one company using this strategy, Anheuser-Busch, though it was evident in several sources that retailers like Amazon, Walmart, and Kroger are some of the key players in using robots or self-driving vehicles in delivery.

Lastly, we changed our strategy again and focused on major CPG and CSG companies in the hope of identifying the technologies they use in their delivery system, which might include robots or self-driving vehicles. Some of the companies we looked into are Unilever, Nestle, P&G, Coca-Cola, and Keurig Dr. Pepper. The assumption was that key players are most likely the first to adopt new technology, such as using robots in delivery services. However, the closest information we found using this strategy is the self-driving robots of Coca-Cola in the UK and Nestle's robots that run distribution centers in the UK and Japan. Since these are outside of the US, we did not include them in our findings.

We summarized our findings on how PepsiCo and Anheuser-Busch use robots in their delivery system above. The limited data on CPG or CSD companies that utilize robots in the delivery of their products could be because the majority of these companies do not directly deliver to their consumers; delivery is mostly done by their retailers, which could explain why giant retailers are leading the usage of robots in delivery.
Sources
Sources

From Part 01
Quotes
  • "The United States are the largest market worldwide in terms of consumer restaurant spending. In 2016, almost one quarter of consumer spending in the industry was attributable to the U.S. market. Food and drink sales in the United States have grown from 379 billion U.S. dollars in the year 2000 to almost 800 billion U.S. dollars in 2017. This is also reflected in the number of restaurants and other food and drink establishments in the United States. In the fall of 2017, the total U.S. restaurant count reached around 647 thousand units."
Quotes
  • "Technavio's examiners conjecture the foodservice showcase in the US to develop at a CAGR of 5.56% during the period 2017-2021."
From Part 03
Quotes
  • "NEW YORK — Forget vending machines, PepsiCo is testing a way to bring snacks directly to college students. The chip and beverage maker says it will start making deliveries with self-driving robots on Thursday at the University of the Pacific in Stockton, California."
  • "Three workers on the campus will be refilling the robots with food and drinks and replacing the batteries with recharged ones when they go dead. At first three robots will be used, but then grow to a fleet of five over time."
Quotes
  • "Anheuser-Busch today announced it has reserved 40 self-driving electric semi-trucks from Tesla for its fleet. It’s one of the highest-profile orders by a major brand since Tesla CEO Elon Musk unveiled the vehicles in November."
Quotes
  • "This year, the World Economic Forum identified eight technologies which are expected to disrupt the retail and consumer packaged goods industry, some of which we have covered before: The Internet of Things Autonomous vehicles and drones AI and machine learning Robotics Digital traceability 3D printing Augmented reality Blockchain"