Success Trends of Chain Food Services Market
Success Trends of Chain Food Services Market


Over the past five years, the chain food services market has emerged resilient even in the face of recessionary pressures and has grown in double digits year-on-year. The reason behind this is:

·         Menu: The broad range of items provided by the menu and the ability to customize them as per customer’s wishes. Offering limited time offers and table top promotion go a long way in building a chain.

·         Price: Offering value for the money by emphasising on portion size and bundling or combo meals.

·         Service format: Provision of different types of serving – counter ordering, table service and drive-thru.

·         Atmosphere: Providing an ambiance for family and friends.

·         Unique elements: Using technology for customer entertainment.

As such many new brands – both Indian and international – have entered the space and are expanding through 3 courses:

·         New cities: Cities beyond metros have now emerged as potential locations for food service outlets, providing volume and a wider customer base to players. Among the top 70 cities in India, ~90% are Tier-1 and Tier-2 locations, which represent an untapped opportunity for expansion beyond metropolitan cities.

·         New formats: Players are looking to branch out through multiple formats, e.g. by establishing their presence in food courts, through express formats, kiosks, etc. This enables them to cash in on the potential presented by these formats and, in addition, rationalise on costs, primarily rentals, which is one of the key P & L costs, primarily rentals, which is one of the key P & L cost for any outlet.

·          New Locations: With the developing travel infrastructure in the country, the prospects for the future expansion of food services outlets lie in exploring travel retail locations such as highways, airports, and stations. These locations give a captive audience, assure high footfalls and provide brand visibility. Apart from these, opportunities also exist in locations such as educational institutions, office complexes, fuel stations, and hospitals.

These trends along with the expanding consumer base, mounting disposable incomes and the ever rising drive to experiment, will continue to promote growth in the food services market and thus make it more attractive to investors.

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