Hospital Food Service Market

Hospital Food Services Market Outlook (2023 to 2033)

The global hospital food services market is expected to be worth US$ 39.7 billion in the fiscal year 2023, up from US$ 37.0 billion in the fiscal year 2022. From 2023 to 2033, the market is expected to grow at a 7.5% CAGR, reaching a value of US$ 81.9 billion by the end of 2033.

As per Fact.MR, a market research and competitive intelligence provider, the Hospital Food Service have been driven, owing to the factors such as the increasing awareness regarding the significance of healthy food options in hospitals, which have given an upper hand to the Hospital Food Service market.

Additionally, the demand for convenience, as well as accessible food options, is growing, as people seek to balance busy schedules with healthy lifestyle choices. Hospitals are responding to this demand by offering more convenient food options, such as grab-and-go options and online ordering systems. This is a major factor that is anticipated to stimulate the growth of the market during the forecast period.

Furthermore, the demand for plant-based food is increasing in the hospital food service market as more people adopt a vegetarian or vegan lifestyle, or seek healthier and more environmentally sustainable food options. Hospitals have been offering more plant-based menu items, including salads, soups, sandwiches, and main dishes made from ingredients such as tofu, beans, grains, and vegetables.

This inclination towards plant-based options helps hospitals cater to a wider range of dietary needs and preferences, and can also support the health goals of patients, visitors, and staff. In addition, the growing popularity of plant-based food is driving innovation in the hospital food service industry, with new products and recipes being developed to meet the changing demands of consumers.

Report Attributes	Details
Anticipated Base Year Value in 2022	US$ 37.0 Billion
Expected Market Value (2023)	US$ 39.7 Billion
Projected Forecast Value (2033)	US$ 81.9 Billion
Global Growth Rate (2023 to 2033)	7.5%
Expected Share of the North America Market (2023 to 2033)	39%
Anticipated Share of European Market (2023 to 2033)	21%
Prominent Players in The Global Market	Compass Group plc.; Sodexo; Aramark; Elior Group; Healthcare Services Group, Inc.; ISS World; Culinary Services Group; Metz Culinary Management; AVI Foodsystems, Inc.; Thomas Cuisine; Hospital Housekeeping Systems (HHS); Whitsons Culinary Group; The Nutrition Group; Food Management Group, Inc. (FMG); Prince Food Systems

2018 to 2022 Hospital Food Service Market Demand Analysis vs. Forecast 2023 to 2033

According to market research and competitive intelligence provider Fact.MR- the market for Hospital Food Service reflected a value CAGR of 5.1% during the historical period, 2018 to 2022. Over the past few years, the adoption of technology has increased dramatically in the market.

Companies have started to use technology to improve their operations, such as automation and digital ordering systems, which are playing a significant role in boosting the growth of the global market fot hospital food service. These technologies are enhancing the efficiency, accuracy, as well as the convenience of hospital food services, which is also contributing to the growth of the market.

The automation has been streamlining the food preparation and delivery process in hospitals, reducing waste, and improving the accuracy as well as the efficiency of food services. For instance, nowadays, many hospitals are using automated systems to track food inventory and to ensure that food is prepared and delivered promptly to patients. Moreover, the digital ordering systems, such as online ordering platforms and mobile apps, are making it easier for patients and their families to order food and view menus.

This technology eliminates the need for patients to call the hospital or visit the hospital's food service area in person, which can save time and improve the convenience of food services. In addition, these systems can provide real-time data on patient food preferences, which can help hospitals improve their food offerings. All these factors are anticipated to propel the demand for Hospital Food Service in the near future.

Prominent Growth Drivers Influencing Hospital Food Service market

Rise in Adoption of Newer Food Menus to Fuel the Market Prospects

Hospitals are seeking to offer a wider variety of food options to meet the diverse dietary needs, and the preferences of their patients. This includes incorporating healthier, organic, as well as culturally diverse food options in their menus.

The adoption of new and different food menus helps to improve patient satisfaction and experience, which is a key consideration for hospitals in today's competitive healthcare environment. As a result, the demand for hospital food services is growing, which in turn is expected to accelerate the growth of the hospital food service market during the forecast period. Thus, the increasing adoption of newer, as well as different food menus for patients in hospitals is driving the market growth.

Increasing Prevalence of Chronic Diseases to Foster the Market Growth

The increasing prevalence of chronic diseases leads to an increase in hospitalization, which drives the demand for hospital food services. People with chronic diseases often require special diets, and hospitals provide customized meals to meet their dietary needs.

According to a recent report from Center for Chronic Disease Prevention and Health Promotion (CDC), every 6 in 10 adults in the US have a chronic disease. As awareness of chronic diseases and their impact on health increases, the demand for healthy and nutritious food in hospitals is also likely to rise. This, in turn, is expected to escalate the growth of the hospital food service market over the analysis period.

What Could Possibly Hinder Hospital Food Service Market Demand?

Complexity of Patient Nutritional Issues to Hinder the Market Growth

The patients in hospitals often have diverse as well as complex nutritional needs, including allergies, special diets for chronic diseases, and cultural or religious dietary restrictions. Meeting these needs requires hospitals to invest in specialized equipment, ingredients, and staff training. This can increase the cost of providing food services and may be difficult for smaller hospitals to manage.

Further, hospitals must ensure that their food services are compliant with food safety regulations, which can add to the complexity of providing food services. These challenges can limit the growth of the hospital food service market by making it difficult for hospitals to provide quality food services at an affordable cost.

Reluctance of OPD Patients to Pay for Food Services to Hamper the Market Growth

In many cases, the patients of Outpatient Department (OPD), are only at the hospital for a short period of time and may not see the value in paying for a meal. Also, the cost of providing healthy and nutritious food options can be high, and hospitals may struggle to balance the cost of providing these options with the prices they are able to charge patients.

This can lead to pricing challenges that can make it difficult for hospitals to compete in the market. These factors can discourage patients from using hospital food services, which can limit the growth of the hospital food service market.

Category-wise Insights

Which service type is forecast to gain the dominant market share?

Patient Services to gain a significant traction

According to Fact.MR’s data, preference for Patient Services segment is expected to expand with a market share of 43% over the forecast period. Patients and their families are increasingly demanding healthier food options in hospitals, which is a major factor that is expected to accelerate the growth of the patient services segment. This demand is driven by growing awareness of the importance of good nutrition in maintaining health and preventing chronic diseases.

Moreover, the provision of high-quality food services in hospitals can improve patient satisfaction, which is a key factor in driving the growth of the patient services segment. Patients and their families are more likely to choose hospitals that offer good quality food services, which can contribute to the growth of the market. Hence, all the aforementioned factors are expected to increase the segmental growth during 2023-2033.

By Settings, which category is forecast to gain the dominant market share?

Acute Care Settings to gain a significant traction

According to Fact.MR’s data, preference for patient services is expected to expand with a market share of 47% over the forecast period. The large share and high growth of this segment can be attributed to the presence of high number of acute hospitals, treatment of a large patient pool in acute hospitals, growing number of admissions in acute hospitals, and the rising adoption of food service outsourcing by hospitals, in order to improve patient experience and reduce costs.

Additionally, the growing demand for nutritious meals in acute care settings is also expected to boost the segmental growth. Patients in acute care settings are often suffering from chronic diseases or undergoing medical treatments, and it is important for them to receive nutritious meals to support their recovery and improve their overall health. Thus, all these factors will fuel the market growth in the near future.

Region-wise Analysis

What is the outlook of the North American Hospital Food Service market?

Increased Patient Satisfaction to expand regional growth prospects

According to Fact.MR, North America is the fastest-growing market region, accounting for over 39% of the market share in 2023, and is expected to maintain its dominance during the analysis period.

Additionally, the regional growth is attributed to the factors such as rising prevalence of chronic diseases including obesity and diabetes, increasing demand for healthier food options, and increased focus on patient satisfaction, and advancements in technology.

What can be expected from the European market For Hospital Food Service?

Increasing Government Initiatives will accelerate the regional demand

According to Fact.MR, the Hospital Food Service market in Europe is expected to account for 21% of the market share in 2023, and is expected to accelerate during the analysis period. Governments in Europe are encouraging the adoption of innovative technologies, such as digital ordering systems and automation, to improve the efficiency, as well as convenience of hospital food services. This is expected to improve patient satisfaction and drive the growth of the European market.

Moreover, promoting governments in Europe are promoting healthy eating through public awareness campaigns, educational programs, and other initiatives. This is aimed at increasing public awareness of the importance of good nutrition in maintaining health and preventing chronic diseases, and is expected to drive demand for healthier food options in hospitals. All these factors are anticipated to accelerate the regional market growth during the forecast period.

Start-up Scenario

• Founded in 2014, Nutriparadise is a B2B food company that produces nutritious food products for hospitalised patients.
• In June 2021, Daalchini, an Indian food tech startup enabled IoT-based vending machines across hospitals. Daalchini’s contactless, smart vending machines were deployed in hospitals including Max, Apollo, Fortis, Dharamshila, Kailash, and Delhi Cancer Hospital. With this development, Daalchini allowed frontline workers, patients and visiting families access to healthy meals in a safe, contactless manner.

Competitive Landscape

Prominent players in the Hospital Food Service Industry are taking advantage of the rapidly increasing demand for the chatbots in various applications. To further their outreach, players are relying on collaborations, partnerships and acquisitions with existing small, medium and large-scale providers. Some prominent market developments are as follows:

• In January 2022, Sodexo announced that it has agreed to acquire Frontline Food Services (d/b/a Accent Food Services), an important player in the fast-growing convenience market in North America. This will broaden the company’s multi-channel offerings, including click n' collect, take-out, delivery, convenience store concepts, micro-markets, self-service pantries, office refreshments, and smart vending
• Aramark, in December 2021, announced a strategic collaboration with Starr Restaurant Organization, in order to optimize the culture of culinary expertise, innovation, and operational excellence at both companies to deliver high-quality hospitality experiences across the United States.

Key Segments Covered in the Hospital Food Service Market Report

• By Type:

  • Patient Services
  • Retail Services
  • Vending & Shops
  • Other

• By Settings:

  • Acute Care Settings
  • Post-Acute Care
  • Other

• By Region:

  • North America
  • Latin America
  • Europe
  • East Asia
  • South Asia and Oceania
  • Middle East & Africa