Eating out less: Food and drink income slips as budgets tighten

Income in the food and beverages sector decreased 0.3% year on year in May, data from Stats SA showed on Thursday.

The monthly survey covers a sample of public and private enterprises involved in the preparation of meals and drinks for immediate consumption, including restaurants, coffee shops, takeaway and fast-food outlets as well as catering services.

“Seasonally adjusted food and beverages income increased by 3.6% in May compared with April. This followed month-on-month changes of minus 3.6% in April and 0.9% in March,” Stats SA said.

Food and beverages income decreased 0.2% in the three months ended May compared with the same period last year, largely pulled down by restaurants and coffee shops.

Income also dipped 0.6% in March to April compared with the previous three months, again weighed down by restaurants and coffee shops.

According to Stats SA, the performance of South Africa’s food and beverages industry often fluctuates in response to changing economic conditions and consumer spending patterns.

A recent survey showed that chicken continues to stand out as the strongest category in the fast food market, driven by its affordability, broad consumer appeal and strong fit with local eating habits.

Nearly 22-million South Africans reported that they primarily eat at chicken-led quick-service restaurant chains, almost double the number of consumers who mainly eat at pizza-led chains.

Though demand for prepared food and beverages remains relatively stable, consumers tend to adjust where and how they spend their money depending on factors such as income growth, inflation, interest rates and consumer confidence.

The latest FNB/Bureau for Economic Research report showed the consumer confidence index dropped from a 15-month high of minus 7 in the first quarter of 2026 to minus 19 in the second quarter, indicating “a notable reduction in consumers’ willingness to spend as higher domestic fuel costs weighed on household budgets”.

In another sign of the strain consumers are under the annual Old Mutual savings and investment monitor published on Tuesday showed that lower income households, in particular, are under increasing financial stress.

Another recent report by PayInc revealed rising inflation is eroding South African salaries, with real take-home pay in June falling to the lowest level in about two years.

Stats SA published the food and beverages income report a day after the Pietermaritzburg Economic Justice and Dignity Group’s latest household affordability index, which tracks the prices of 44 basic foods, showed that the average cost of the basket increased by 0.5% to R5,530.52 between June and July, a year-on-year rise of 1.6%.

Food in the basket which increased in price in July included apples, maize meal, cooking oil, salt, potatoes, frozen chicken portions, stock cubes, eggs, wors, beef tripe, tomatoes, butternut, cabbage, Cremora, tinned pilchards, peanut butter and polony.

Items whose prices decreased included carrots, cake flour, samp, onions, soup, tea, beef liver, fish, spinach, green pepper, baked beans, bananas, oranges and margarine.