Description
India’s foodservice market was estimated at Rs. 3,40,052 crore (USD 50.75 bn) last year. The market is growing at a CAGR of 10 per cent and is expected to be Rs. 4,97,870 crore (USD 74.32 bn) in 2021. The organized share of the market is 34.5 per cent and is growing at 15 per cent. In recent times, the industry has seen a steady shift – from the unorganized to organized segment owing to the implementation of GST and the aspiration on the part of players to upgrade ambience, infrastructure, services and technology.
The quality of food remains the most critical factor for determining the growth and success of restaurants, on the consumer side. This key driver is followed by ‘location’ and ‘pricing’. The quality of food has a lasting impact and it helps build the recall factor in the mind of customers. On the other hand, convenience of visit and choice of outlet is largely determined by a restaurant’s location, while pricing infl uences the perception of affordability and related consumption behavior. The expected pricing also represents the level of desired service by the consumer. Today, as consumers are showing a serious preference for healthy food, organic food has emerged as a rising trend, and is seen as more important than pricing and cuisine preference, especially in urban areas.
When it comes to the preferred strategy for growth on part of foodservice players, pan-India and/ or regional expansion are being seen as the primary strategy for growth by stakeholders. To action retail expansion, players are drivenby the expectation of funding from private equity fi rms or the availability of internal accruals or promoter fund and/or bank loans. To increase bill value or to attract new customers, FS players are also resorting to adding new cuisines or expanding menus, which once again underscores the importance of foodas a key element to the success and growth of restaurants.
