The Appetite for Change: How Weight-Loss Drugs Could Reshape the Restaurant Industry
“Restaurants are never just about the food. They sell convenience, in the case of limited service, or an experience, in the case of full service,” says Brian Harbour, equity analyst at Morgan Stanley. “But they could face declining sales in the medium term,” he cautions.
The weight-loss medication market is undergoing a significant transformation, and the ripple effects are being felt across various sectors, perhaps none more prominently than the restaurant industry. No longer relegated to niche corners of the health landscape, these drugs, with brand names like Wegovy, Mounjaro, and Zepbound (the one now dominating headlines, however, is Ozempic), are becoming increasingly mainstream.
Experts predict that by 2035, a staggering 24 million Americans—7% of the total population—will be taking these medications. This seismic shift in consumer behavior is prompting an extensive reevaluation within the food industry, with restaurants particularly exposed to the evolving appetites of health-conscious diners.
Eating Less, Ordering Less, and Shifting Habits
A recent survey by Morgan Stanley revealed that 63% of individuals taking Ozempic are ordering less food when dining out compared to their pre-medication habits. Furthermore, over 60% of those surveyed admitted to spending significantly less on takeout and delivery services. This change is most apparent in the consumption of sugary and fatty foods, with some consumers reporting a two-thirds reduction in their intake of confections, sugary drinks, and baked goods.
As more people turn to these medications, Morgan Stanley predicts a potential decline of up to 3% in the overall consumption of carbonated soft drinks, baked goods, and salty snacks by 2035.
The Impact on the Culinary Landscape
The rise of these medications presents both challenges and opportunities for the restaurant industry.
Quick-service restaurants, which often rely on high-calorie, inexpensive offerings, may be particularly affected. Morgan Stanley analysts antivirus, and project a potential decline in sales growth for these establishments, ranging from 1% to 2% in the coming years.
Healthier restaurants, on the other hand, seem well-positioned to adapt to evolving consumer preferences. They may see a surge in demand as diners prioritize lighter, more nutritious options.
“Restaurants are betting on experience more than just food,” notes Harbour. ”
While acknowledging the potential difficulties ahead, analysts emphasize that these drugs do not pose an overwhelming threat to the restaurant industry. “It’s not an existential risk,” Harbour emphasizes.
## The Silver Lining: A Benefit for Airlines?
The potential impact extends beyond restaurant doors, affecting industries like travel.
Lighter passengers translate to less fuel consumption for airlines. Imagine the cost savings for carriers if weight loss becomes a trend, prompting a reduction in the invited re. A recent study estimated that even a small 10-pound weight loss per passenger could save a carrier like United Airlines up to $80 million annually in fuel costs.
What strategies are restaurants using to adapt to the changing demands of health-conscious consumers driven by weight-loss drugs?
## The Appetite for Change: Restaurants Face Weight-Loss Drug Dilemma
**Host:** Welcome back to the show. Today, we’re tackling a hot topic: the impact of increasingly popular weight-loss drugs on the restaurant industry. Joining us to discuss this intriguing phenomenon is Brian Harbour, equity analyst at Morgan Stanley, who has been closely studying these trends. Brian, thanks for being here.
**Harbour:** Happy to be here.
**Host:** So, Brian, these drugs like Wegovy, Mounjaro and Ozempic are making headlines – but what are the implications for restaurants specifically?
**Harbour:** Well, restaurants are about to face a significant challenge. While they offer convenience and experiences, their offerings are directly impacted by shifts in consumer behavior. [[1](https://www.forbes.com/sites/brucejapsen/2024/11/26/employers-may-follow-medicare-coverage-of-glp-1-weight-loss-drugs/)]. Morgan Stanley research shows a significant portion of individuals taking Ozempic are ordering less food, spending less on takeout and delivery, and drastically cutting back on sugary and fatty foods.
**Host:** That’s a pretty big change in habits. What does this mean for restaurants in the long run?
**Harbour:** It means restaurants could see declining sales in the medium term. They’ll need to adapt to this new reality and offer options that align with the needs of health-conscious consumers.
**Host:** Are there any specific ways you see restaurants responding to these changes?
**Harbour:** Absolutely. We’re already seeing restaurants introduce lighter menu options, focus on portion control, and emphasize healthier ingredients. Some are even incorporating weight-loss friendly meals into their offerings. Innovation and adaptability will be key for their survival.
**Host:** This is fascinating. It seems like we’re on the cusp of a major transformation in the food landscape. Brian, thank you for sharing these insightful predictions with us today.
**Harbour:** My pleasure.