A Case for Sustainable Foodservice Packaging in Western Europe

Foodservice takeaway sales (a combination of delivery, drive-through and takeaway occasions) are expected to grow by an average 6.7% each year in Western Europe through to 2028, adding USD74 billion in new value (at constant 2023 prices). Simply put, “takeaway” is becoming a more important opportunity for foodservice operators as 2024 represents the continued growth of a much longer-term, convenience-orientated shift in the way consumers dine out. As takeaway occasions take a greater share of total foodservice sales, restaurants will need more foodservice packaging, and consumers will see that packaging more often. 

While most large chained operators manage their suppliers centrally, independent operators typically build supply chains themselves with an aim to keep costs low and may overlook more sustainable options. Despite the added costs, however, sustainable packaging can be an important investment for independent restaurants looking to interlink sustainability with their core brand. Early movers that build relationships early on with sustainable suppliers will have stronger negotiating power in the future, get ahead of coming regulation and enjoy a distinct market advantage by addressing consumer sentiment around packaging and plastic waste.

A foodservice supply chain cost analysis

In foodservice, keeping costs low is one of the most important rules for restaurants hoping to eke out a profit from traditionally low-margin transactions, and costs have risen steadily over the past few years. While some costs, like rent and labour, are considered fixed, others, like packaging, are negotiable and restaurants typically look for the cheapest suppliers. Consumers are more crunched at the wallet too. Lingering inflation across Western Europe has not only punctured disposable incomes, but has also forced consumers to learn how to shop more carefully. However, this doesn’t mean trading down or trading out all the time. Consumers are now increasingly willing to trade up for accessible luxuries that are fun and show clear value, a global consumer trend Euromonitor calls “wiser wallets” for 2025.

This is good news for restaurants. Dining out can be inherently fun and if packaging is becoming a more important part of a restaurant’s brand identity, sustainable packaging can be a quick way for a restaurant to communicate value. 

Reworking the supply chain for better business

In any event, coming regulations will force businesses in Europe to choose sustainable suppliers in the long term. EU-level directives linked to the European Green Deal, like the Corporate Sustainability Due Diligence Directive, which will enforce environmental protection along the supply chain, and the Packaging and Packaging Waste Regulation, which will ensure the recyclability of packaging products, may only apply first to the largest companies in the coming years, but the transition made by the largest foodservice chains will have a cascading impact on smaller companies looking to avoid falling behind as consumer expectations change.

These new laws have already sparked a wave of innovation from European companies, start-ups and universities trying to tackle sustainability across the supply chain. Innovation is especially critical in foodservice packaging, which, unlike other packaging types, has specific challenges in order to keep meals both hot and appealing in transit. New suppliers claim that component parts specific to the needs of foodservice, like grease-resistant papers, oxygen barriers, UV barriers, water-resistant materials, and water vapour barriers, can be either biodegradable or recyclable to meet coming requirements. These technologies exist, but it will take two-way partnerships with restaurant buyers to understand how these sustainable packaging options can transform a brand for mutual benefit.

22.7% of Gen Z consumers in Europe claimed to buy sustainably-produced items in 2024 

^{Source: Euromonitor Voice of the Consumer: Sustainability Survey, fielded January to February 2024 (n=1,279)}

Early movers stand to gain a competitive advantage in sustainability, but, importantly, they also benefit from a chance to build early relationships with stronger long-term price negotiation possibilities. And, while many restaurants currently rely on their delivery partners for takeaway packaging (which carries the brand of the delivery partner), there is also a budding trend in bringing delivery in-house in an attempt to rein in third-party costs and increase quality assurance. First-party delivery sales, for example, are expected to grow by 28% in value terms in France in 2024, compared with 7% growth amongst third-party services. These restaurants will lean on new sustainable packaging supply partners to help shape their identities as brands and gain more control over the way they communicate the value needed to convince consumers to spend a little more. 

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