After working with hundreds of food manufacturers over the past 30+ years, we have seen first-hand how good, regular market insights can create successful foodservice businesses.
For many food manufacturers, understanding customers in the retail channel is relatively straightforward.
Supermarket scan data provides detailed insights into purchasing behaviour, market share, pricing and category performance. Executives can quickly answer questions such as: Which products are growing? Who is buying them? How often? And at what price?
Foodservice, however, has traditionally been viewed differently.
I’ve heard countless manufacturers say:
“Foodservice is difficult because there isn’t any data.”
After more than 30 years working in foodservice market intelligence, we can confidently say this is a myth.
The reality is that foodservice is one of the most under-measured channels in the Australian food industry, not because data doesn’t exist, but because many organisations don’t know where to find it, how to structure it, or how to use it effectively.
The manufacturers that perform best in foodservice are those that consistently collect, connect and use valid data to support their decisions.
Why understanding foodservice is so difficult
Many food manufacturers enter foodservice with a retail mindset.
This is understandable, as many sales and marketing teams have built successful careers working with supermarkets and large retailers.
But foodservice is fundamentally different.
Unlike retail, foodservice is highly fragmented. Operators include cafes, restaurants, pubs, clubs, hotels, aged care facilities, hospitals, schools and quick service restaurants, each with different needs, purchasing behaviours and menu applications.
The distribution landscape is equally complex.
Many manufacturers are surprised to learn that the top five foodservice distributor groups account for only around 36% of total market volume. This means relying solely on distributor feedback or sales team anecdotes provides only a partial picture of what’s happening in the market.
Another common mistake is focusing on the wrong part of the market entirely.
Without understanding the structure of foodservice, manufacturers often invest time and resources targeting channels that have low relevance to their products.
The data manufacturers should be using
The most valuable data comes from understanding the end users of your products: foodservice operators themselves.
The strongest strategies combine multiple data sources, including:
- Foodservice market sizing data
- Channel insights data
- Menu intelligence data
- Foodservice operator surveys
- Consumer dining behaviour studies
- Competitor analysis
- Foodservice brand performance tracking
- Statistically representative datasets that cover all foodservice channels and geographic regions
The key is ensuring the data is statistically robust and representative of the entire market rather than isolated pockets of information.
No single data source tells the complete story.
The companies that win in foodservice aren’t collecting more data. They’re connecting different data sources better.
The questions manufacturers are trying to answer
Across hundreds of projects, we consistently see manufacturers asking four fundamental questions:
- Which channels are growing?
Where are the biggest opportunities for my products over the next five years?
- Who is using my products?
What types of operators are heavy users of my category?
- How is my brand performing?
How does brand awareness and usage compare year on year?
- How do we reach operators we don’t directly sell to?
Most manufacturers sell through distributors and have little direct relationship with end users. Data helps identify and prioritise ideal prospects.
Real examples of data driving decisions
Data becomes valuable when it changes decisions.
We’ve seen manufacturers use data to:
A large bakery supplier
A major bakery supplier adjusted investment plans for a new production line after demand forecasts showed weaker long-term growth for a particular product category than originally expected.
A sauce manufacturer
Detailed menu intelligence identified growth opportunities across flavour profiles and cuisines, allowing the business to prioritise product development.
A protein supplier
Brand performance tracking revealed how branded proteins performed against competitor and non-branded alternatives, highlighting opportunities to strengthen brand presence.
A mayonnaise manufacturer
By analysing menu data, they discovered numerous applications for mayonnaise across cuisines, channels and recipes that had previously been overlooked.
These examples demonstrate that data is no longer simply about reporting the past. It is about reducing risk and improving decision making.
Five metrics every manufacturer should monitor
If we had to recommend only a handful of metrics, they would be:
- Market structure
How many foodservice outlets exist, and how is the market changing?
- Brand performance
How strong is your brand awareness, usage and tracking?
- Menu penetration
How often does your category appear on menus?
- Operator sentiment
How confident are operators about business conditions?
- Distribution reach
How effectively are your products reaching the market?
These metrics provide a balanced view of both current performance and future opportunities.
Why many manufacturers still struggle
Interestingly, a lack of data is rarely the problem.
The biggest challenges are:
- Insufficient budget allocated to foodservice insights
- Poor (or late) planning
- Inconsistent definitions that prevent meaningful comparisons
- Mixing retail, convenience and foodservice datasets together
- Limited internal foodservice expertise
- Failing to turn insights into action
- Over-reliance on sources that only see part of the market
Foodservice should not be treated as a subset of retail. They are entirely different markets requiring different approaches.
Our framework: Discover, Analyse and Focus
At Food Industry Foresight, we use a simple three-step process.
Discover
Conduct an initial discovery workshop to understand objectives, challenges and opportunities.
Analyse
Bring together multiple data sources to build a comprehensive picture of the market.
Focus
Prioritise actions, guide investment decisions and opportunities that will generate the greatest return, combined with a follow up tracking regime to support annual performance tracking.
Simple frameworks often outperform complex ones because they create alignment across sales, marketing and leadership teams.
Final thoughts
Foodservice is one of Australia’s largest food channels, yet it remains one of the least understood.
The opportunity for manufacturers is enormous.
The businesses that succeed are not necessarily those with the biggest budgets. They are the organisations that consistently invest in understanding their customers and make decisions based on valid data rather than assumptions.
After all, it is a myth that there is no data in foodservice.
The real challenge is knowing how to find it, connect it and use it.
And increasingly, that capability is becoming a competitive advantage.
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