Investors Alert: Here Are Top 4 Areas Of Investment In The UAE Restaurant Industry In 2021

Major Areas of Investment

Running a restaurant is a tricky business. One can’t simply open up a restaurant and expect to be successful without facing hurdles. Post COVID-19, the restaurant industry faces growing uncertainty which is why it is essential for business owners to have a clear picture of where capital should be invested to generate the maximum profits. Most restaurant professionals are placing their bets on embracing technology, while others still believe in starting a restaurant business from scratch and exploring other areas of investment. 

Top 4 Areas Of Investment Which Will Generate The Maximum Profit

We asked restaurant owners across the UAE what the major potential areas for investment could be for their restaurant in 2021 and received the following responses:

  • Set up a cloud kitchen or delivery-only outlet
  • Increased staffing 
  • Embrace technology
  • Open a restaurant in a new location

Let’s go through them one by one.

1. Set Up A Cloud Kitchen Or Delivery-only Outlet

Setting up a cloud kitchen or delivery-only outlet is considered to be a safe bet to invest money this year. The COVID-19 pandemic has forced restaurateurs to identify the market’s unexplored potential and research what model of cloud kitchen fits them best. 

The UAE PRIME report suggests that more than 70 percent of the restaurant professionals were open to investing in cloud kitchens or dark kitchens. They hope that this would not only streamline restaurant operations but also keep businesses running with reduced costs amidst the pandemic.

2. Increase Staffing

With the economy on its way to recovery, restaurateurs are looking forward to restaffing their restaurants as dining out facilities are about to restart. Moreover, new restaurateurs are starting up operations to take advantage of lower rentals and inventory prices following the lockdown. Therefore, 38 percent of the respondents were interested in investing their funds in hiring and rehiring staff for their restaurants.

Increased Staffing
Source: Forbes

3. Embrace Technology

Our report highlights that 40 percent of restaurant professionals are open to investing in technology as they understand that embracing technology is a one-time investment and will profit them in the long run, especially now, more than ever. 

Adopting digital menus, QR code technology for a contactless dining experience and app-based ordering and reservations are some of the prominent technologies that restaurateurs are increasingly adopting. Efficient POS systems are also one of the basic digitized technologies restaurant operators are investing in, to prepare for increased footfall once lockdown restrictions are lifted. With the aim of efficient kitchen management, streamlining operations and maximizing profits, the restaurant industry is now becoming tech-centric. A gradual shift from digitization to automation is also in progress.

4. Open A Restaurant In A New Location

While the already established restaurant operators are investing more in revamping their operations and increasing efficiency, new players are preparing to step into the industry. Then there are also some entrepreneurs who want to expand their business by opening their restaurant branches in new locations. 

As per our UAE PRIME report, almost 42 percent of the respondents wanted to invest in opening a restaurant in a new location which suggests that acquiring restaurant spaces while rentals are still low would be a bargain for them. 

The pandemic has hurt many industries in almost every part of the world. From restaurants to tourism and trade, every field bore the brunt of the coronavirus. The reduction of tourism in the UAE along with changing consumer preferences has reduced restaurant footfall to a great extent. This has made restaurant operators tighten their belts and explore the various areas they can move forward in the upcoming year to span their business across larger areas. 

UAE PRIME EDITION

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