New F&B concepts arriving in the UAE must focus on bringing value for money to the table to achieve success in a fiercely competitive market, according to Youssef El Habbal, CEO, Serenity Hospitality.
Fast-casual restaurants fall between traditional, counter service fast food restaurants and casual dining establishments with table service and they have many elements that make fast food appealing, including immediate service, take out or eat in options and low prices. Here we look at the main drivers behind the success of the fast-casual business model as explained by the CEO of Serenity Hospitality.
Rise of Millennials & Expats: Evolving demographics with a younger population and increase in expat population translates into more demand for good quality yet convenient food offerings regarding service and pricing. People are getting busier, working adults are dining out less and people prefer to be in and out quickly.
Higher costs of living: With the introduction of VAT, the cost of living has gone up. The increased price on restaurant bills is making guests look for other options. Consumers are trading down and looking for a less average spend per dining experience as they seek more value for their money. Fast casuals are less prone to be affected by economic recessions as their average check is low and remains affordable when compared to full service-fine dining restaurants.
Demand for quality: Millennials are interested in higher quality and healthier made-to-order food options. They are seeking out restaurants serving healthy and locally sourced ingredients. By offering healthier choices that someone can get on the go, fast casual’s quality and convenience will allow it to become one of the primary options.
Scalability of the business: Fast casuals are more easily scalable as they address the gaps in the market, cater to all demographics and require less investment per outlet. The simplicity of the concepts makes them easier to operate, not to mention more accessible to the average consumer.
Market saturation: There are no limits to eating out options across the UAE and the increase in supply, in some segments of the market, continues to exceed the rise in demand. Market saturation and increased costs have afflicted the restaurant industry and as a result, the fast-casual model will be more appealing to operators.
Restaurant Real Estate: Urbanisation is encouraging the growth of fast casual as they require a smaller footprint conductive to operating in cities where rents are excessively high. Instead of having to downsize, restaurants are right-sizing. Store operators are becoming more resourceful, creating opportunities for landlords who can reconfigure their spaces to meet this new market dynamic.
Omni-channel customer experiences: Fast casuals are enjoying a growth in the global business climate as they are uniquely positioned to take advantage of the digital communication, social media marketing trends, and food delivery channels. Omni-channel technologies can be instrumental in elevating the brand experience and leaving customers satisfied. Fast-casual restaurants use mobile technology and other connected devices to not only learn about their customers wants and needs, but to leverage this data to create a truly unique personalised experience.
