The Shrinking Plate: How Weight Loss Drugs Are Reshaping the Restaurant and Food Industry
A mini burger, mini fries, and mini beer. That’s the reality for some diners at Clinton Hall in New York City, a response to a growing trend: the increasing use of GLP-1 drugs for weight loss. Approximately one in eight American adults are currently taking these medications, and the food industry is taking notice.
The GLP-1 Effect: Less Appetite, Less Spending
GLP-1 drugs, like Ozempic and Zepbound, work by slowing digestion and suppressing appetite. The impact is significant. Adults using these medications consume 21% fewer calories and spend nearly a third less on groceries, according to KPMG. JPMorgan estimates this could translate to a $30-$55 billion hit to the food and beverage industry by 2030. The trend is expected to accelerate, with projections of over 30 million Americans on GLP-1 treatments by 2030, up from 10 million in 2026.
Snacking Takes the Biggest Hit
The shift in consumer behavior isn’t uniform. While overall caloric intake is down, certain categories are more affected than others. Snacking has taken the biggest hit, with 70% of GLP-1 users reporting they snack less, according to a survey by EY-Parthenon. Consumers are shifting towards healthier options like yogurt, nuts, and fruit, rather than chips and pretzels.
Dining Out and Drinking Less
The impact extends to restaurants. Roughly 60% of GLP-1 users are dining out less frequently. Restaurant visits, particularly for dinner, are declining. About 45% of those eating and drinking less are also consuming less alcohol. Bernstein analysts suggest restaurant visit frequency among GLP-1 users could fall by as much as 45%, depending on the type of food and occasion.
Breakfast and Speedy Food Feel the Pinch
The decline in restaurant traffic isn’t evenly distributed. Breakfast, particularly among higher-income GLP-1 users, has seen a noticeable decrease. Dinner traffic has fallen 6% among GLP-1 users, representing a 0.4% overall decline in restaurant sales during dinner hours. For limited-service restaurants like McDonald’s and Taco Bell, where snacking accounts for 12% of spending, the impact could be substantial.
How Food Companies Are Adapting
Despite the potential challenges, food companies are seeing opportunities. The key is adapting to the changing needs of consumers.
Focus on Protein and Fiber
Companies are increasingly focusing on protein- and fiber-rich options. PepsiCo has launched protein-packed Doritos and fiber-rich SunChips and Smartfood popcorn. Domino’s Pizza CEO Russell Weiner noted the chain is prepared to innovate its menu if needed. Olive Garden has introduced a “Lighter Portions” menu with smaller entrees at lower prices.
Marketing to the GLP-1 Consumer
Some companies are explicitly targeting GLP-1 users. Nestle launched Virtual Pursuit, a frozen-food brand initially marketed without a GLP-1 focus, but later updated its packaging to highlight its suitability for those on the medication. J&J Snack Foods, owner of Dippin’ Dots and Icee, is adding protein to its soft pretzels and introducing smaller, antioxidant-rich “mini pops” for Luigi’s Italian Ice.
The Cycle of Behavior and Oral Medications
The long-term impact remains to be seen. About 5% of GLP-1 users discontinue treatment due to cost, side effects, or achieving their weight goals, often reverting to previous eating habits after a period. The introduction of oral GLP-1 medications is expected to broaden adoption, potentially attracting a new segment of users who were previously hesitant about injections.
FAQ
Q: What are GLP-1 drugs?
A: GLP-1 drugs are medications originally developed for diabetes treatment, now widely used for weight loss by slowing digestion and suppressing appetite.
Q: How much could the food industry lose due to GLP-1 drugs?
A: JPMorgan estimates the growing use of these medications could wipe out $30 billion to $55 billion in annual sales for the food and beverage industry by 2030.
Q: Which food categories are most affected?
A: Snacking is currently the most impacted category, with a significant percentage of GLP-1 users reporting reduced snacking.
Q: Are restaurants doing anything to adapt?
A: Restaurants are offering smaller portion sizes, emphasizing protein content, and developing healthier menu options to appeal to GLP-1 users.
Q: Will the introduction of oral GLP-1 drugs change things?
A: It is expected that oral versions will lead to higher adoption of GLP-1 drugs, potentially attracting a new group of users.
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