Mega Events in the Middle East Accelerate Restaurant Industry Growth: PRIME Middle East Report

• 87% of respondents expect Expo 2020, T20 World Cup, and FIFA World Cup 2022 to impact the duration of these events positively

• Nearly 30% of restaurant operators said they plan to spend marketing dollars on promotional campaigns around these events.

As Diners Return, Restaurants Face Challenge in Hiring

55% of restaurants to hire more front and back house staff by year-end

Despite a slowdown in business for a brief interval, employment opportunities are back on track. Most operators across fast-casual, fine dining and cloud kitchens say they have job openings they’re finding hard to fill. In addition, restaurant operators take other steps to prepare themselves for the season of peak demand. The report highlights

• Nearly 55% of respondents said that hiring staff is their top priority to manage the sudden rise in the footfall of diners and orders.

• Further, 46% of operators upgrade their interiors to improve ambiance, and 34% said they had devoted more resources to creating outdoor dining spaces for the winter season.

Hybrid Business Model to Create New Revenue Streams

42% of restaurants explore new locations, and 34% set up direct online ordering

Though revenues in restaurants are returning quicker than expected, online delivery is still a significant part of its revenue. Restaurants are exploring ways to control their operating expenses, such as rentals and staffing costs. In times like these, a hybrid business model that uses a combination of cloud kitchen delivery and hero stores is a viable option to maintain a balance of dine-in and delivery business.

• 65% of respondents expressed interest in setting up a cloud kitchen, also known as dark, satellite, virtual, or ghost kitchens

• 42% of restaurant operators are exploring opening a new location, and nearly 34% of respondents shared they are setting up online ordering via their website, social media channels, or mobile app

Restaurants Top-up Menu with Healthier Diet

65% of operators say they have added more items to their menu

As the restrictions have reduced and consumers have started going out, restaurant operators are gearing up to add more items to their menu in the coming months. One of the most consistent long-term food trends has been the increased visibility and consumer demand for sustainable and perceived-healthier food.

• 65% of operators say they have added more items to their menu, while 25% have about the same things on their menu, and 10% have reduced their menu items

• As high as 79% of restaurants shared that healthier food choices are preferred by customers, followed by 73% stating customers are open to takeaway and food delivery.

 

Restaurants opt-in D2C (Direct to consumer) Channels to Grow Orders

One-third of operators take orders via direct channels like Website and Social Media

This hints that as food delivery proliferates, consumer behavior is changing and perhaps to the advantage of the restaurant operator. As consumers become more familiar with delivery and ordering online, they’re more likely to choose a direct channel to order from the brand. The report highlights the rising role of social media channels to create new avenues for ordering food.

• 93% of restaurant operators shared they actively use Social media like Instagram, Facebook, and Twitter to run promotional campaigns

• 32% of operators shared they are actively running digital marketing campaigns for promotion, followed by 26% who shared they have invested in influencers marketing on platforms like Instagram and Facebook.

“With 2021 behind us and vaccines rolling out across the Middle East, we can start to see the end of this pandemic.  Our research and analysis of the restaurant industry unveil three innovation areas that will set the tone for 2022. These areas include online ordering, menu optimization, and a hybrid business model that will change the way restaurants operate.

In the PRIME (Posist Restaurant Industry & Market Evolution) Middle East edition, we look at a broader view of how the restaurant industry is gearing up for growth alongside significant events in the region, such as the ongoing Expo 2020 and upcoming sporting events like  FIFA World Cup Qatar 2022™ and the boost in Kingdom’s tourism sector.”  Ashish Tulsian, Co-Founder & CEO of Posist.

“Incredibly proud to be associated with such an initiative that would drive the industry forward in the times ahead with clarity and focus. I take this opportunity to thank you for your contribution and for being part of this unique, trendsetting exercise that would benefit one and all associated with the culinary industry” Naim Maadad, Founding Board Member, Dubai Restaurants Group.

To download the report, please visit primereport.org

This study is based on a survey of restaurant operators conducted in September 2021 and interviews with executives from quick-service restaurants (QSR), fine dining, casual dining, and cloud kitchen brands. It examines the restaurant industry’s long-term sentiment amid the ongoing events, and the industry is preparing itself for the pent-up demand anticipated in 2022.