The foodservice sector is very dynamic: all experts agree on this. As people have less and less time to prepare meals, they appreciate even more than before going to restaurants or being served in planes or in cafeterias. Yet, today, the foodservice experience is not just a matter of food, it also deals with health concerns, food trends, restaurants concepts... and the notion of pleasure. Local or global, homedelivery or on-site, creative or traditional cuisine, equipment or ingredient... there are now many ways to consider the foodservice sector, its challenges as well as its opportunities. It’s now time to discover the major assets and opportunities of this very dynamic sector.
WHAT IS ‘FOODSERVICE’?
Foodservice defines businesses, institutions, and companies responsible for any meal prepared outside the home. The foodservice industry includes restaurants, school and hospital cafeterias, catering operations, etc.
CHINA, NOW THE LARGEST MARKET FOR FOODSERVICE RESTAURANT. The Chinese restaurant market is expected to grow at a CAGR of 11.5% between 2017 and 2022! Soon to overtake America? No! China is already the largest market for foodservice restaurants, globally, ahead of the US! How come? Eating out is a very popular practice in China, and the major way to socialize with relatives and friends. Another motivation for going out to restaurants, cafes, bars, or cafeterias, is the very busy schedules of workers. Having less and less time to eat, their eyes are looking at convenience foodservice offers, even for a breakfast. What will happen in the future? Growth is expected to slow a little bit, in the medium term, with sales reaching US$814.5 billion in 2019. Nowadays, full-service restaurants are the dominant subsector and will remain so for a long time, though the takeaway market is growing very quickly (a CAGR of 20.6% is expected during the 2015-2019 period). Within this context, how can new operators emerge? Being innovative in terms of value-for-money and offering a healthy cuisine may not be enough. The demand for safe and high-quality ingredients should also be taken into account. Last but certainly not least, the improvement of home delivery solutions is another issue at stake, especially in some key areas of the country. In China, establishments must take the high road and differentiate themselves in order to seduce new customers!
IN THE UAE, CUSTOMERS ARE LOOKING FOR EXPERIENCES.In the Emirates, the foodservice sector has been growing rapidly over the past few years. Though fast food restaurants remain the largest segment, accounting for 58.2% of the GCC foodservice market, other segments are growing faster, such as service restaurants (with a 31.5% market share), as well as cafes and bakeries (10.3%). Will the market continue to expand in the short and medium terms? Yes, for two main reasons. First, the consumer base will continue to increase as more and more young professionals from all over the world are moving to the UAE. Second, the population grants less time than ever to the preparation of food while having very diversified nutritional needs. This is why the foodservice industry is promised a rosy future, despite the fierce competition taking place between all actors. The foodservice landscape remains quite fragmented, led by regional and domestic franchise partners. In the meantime, new players are looking to diversify their investment portfolios, such as Alshaya Group, Azadea LLC and Marka Holding PJSC. As competition intensifies, how is it possible to stand out
from the crowd? According to many experts, it is time to develop the online experience and to offer more creative cafe and restaurant experiences – with focus on ambiance and decor in order to personnalize the venue. There are many opportunities in the UEA for creative players!
CANADA, A DYNAMIC BUT VERY DEMANDING MARKET. In the maple leaf country, 2017 has been a new year of good economic health, with a solid growth of 2,1% of its GDP. The foodservice market is expanding even more, with sales projected to grow by 4.9% between 2017 and 2018. But who are the winners of this business trend? Increased competition in the industry drove less profitable independent restaurants out of business. The best performers see their overall
sales just stagnate… In the meantime, chained players reap the benefits of their investments. Thanks to stronger economies of scale, they can easily meet the consumer needs for healthier and premium food and develop their network across the country. Yet, there might be a solution for independents and new players to perform in Canada: just by shifting towards higher quality, healthier and more ethical ingredients. Another solution is to create an original concept, offering a distinctive experience. Good to know, young generations – and more specifically millenials – are more and more demanding on what they experiment and what they eat. As they prefer fresh local food, premiumisation might be an additional key for success,mas is digitalization. Since the market gets more and more competitive, only the most innovative players can do better than just hold one’s own. A good example? The meal-keat success! This subscription service sends customers pre-portioned food ingredients and recipes for them to prepare homecooked meals.
FRANCE IS BACK ON TRACK. The Foodservice market has registered a growth of 1.8% in 2017, after several years of stagnation. Good news for everyone? Independent players have been hit harder by reduced consumer spending on foodservice over the past few years. But many of them have been rethinking their approach, offering better quality and original concepts of cuisine. As GDP growth resumes, they now reap the fruits of their actions. On the other side of the market spectrum, chained operators continue to develop new hybrid concepts and franchises, opening more and more outlets all over the country. As a large proportion of urban population is time-pressed, seeking convenient food options, the demand for quick service restaurants and fine fast food can’t stop growing, especially in big cities. Another phenomenon reshuffles the landscape. Digitalisation is shaping the French foodservice sector more than in other Western countries, as the market used to be very traditional. Big winners will be those who tie a partnership or develop their own delivery service solution in order to make customers more loyal. The digital revolution is underway!
INDONESIA, BETWEEN TRADITION AND MODERNITY. In Indonesia, the foodservice market is still very traditional. Yet, the sector has taken several giant steps towards, due to the strategic importance of international tourism. High-end hotels and restaurants that serve local and international cuisine, fast food outlets, cafés and bars, bakeries, and low-end small restaurants, street-side restaurants known as warungs… the network is more and more diversified, serving noodles, Japanese food, pizza, fried chicken, etc. What’s new in the country? In Jarkarta, food trucks serve food on the street! And throughout Java and Bali, 24 hour convenience stores now provide consumers with hot or cold beverages, burgers, hotdogs, pastries and bread...
Sources : Nielsen Cabinet - Nielsen ScanTrack - Alpen Capital - Businessinsider - Bloomberg - FDA - Research and
markets - Businesswire - LSA - CCFA - OFC - Canadian Grocer - Euromonitor