The Food Dollar: 50% Devoted to Restaurants

When Americans buy food, they devote most of their budget to convenience, according to the USDA's Economic Research Service. Half of the average household's food budget is devoted to the most convenient food of all—restaurant meals. Another 26 percent is spent on ready-to-eat or ready-to-cook foods. Only 5 percent of the food dollar is spent on basic ingredients. Here's how the average American household allocates its food spending...

Distribution of household spending on food by food convenience type
Fast-food restaurants: 27 percent. Defined as meals and snacks at establishments where customers order and pay for food at a counter.
Sit-down restaurants: 23 percent. Defined as meals and snacks at establishments where customers order and pay for food from waitstaff.
Ready-to-eat food: 18 percent. Defined as meals and snacks intended to be consumed as is, requiring no preparation beyond opening a container such as yogurt, candy, flavored milk, etc.
Complex ingredients: 18 percent. Defined as processed food usually composed of multiple ingredients such as bread, pasta, lunch meat, cereal, etc.
Ready to cook food: 8 percent. Defined as meals and snacks that require minimal preparation involving heating, cooking, or adding hot water such as frozen pizza, pudding mixes, soup, etc.
Basic ingredients: 5 percent. Defined as raw or minimally processed food usually composed of a single ingredient such as milk, rice, butter, fresh meat, fruit, and vegetables.

Source: USDA, Economic Research Service, U.S. Households' Demand for Convenience Foods