Where are the customers?
To Euromonitor’s Emil, the outlet closures pointed to one thing – that the operators were not giving people enough reason to eat at their restaurants and to remember their brand.
And with the declining footfall in certain outlets, it makes little sense for an operator to keep them open from a cost-efficiency perspective, she added.
“Consumers are going for value options,” the analyst said, emphasising that this presents the biggest challenge to operators like Katrina Group, JFH and Tung Lok.
And consumers are increasingly becoming brand-agnostic, she said.
Meanwhile, limited-service restaurants are booming, noted Emil. These include fast-food chains and fast-casual concepts like Poke Theory and Stuff’d, which combine fast-food and 100-per-cent takeaway outlets.
“Many consumers see this category as the perfect balance between value and quality,” she said.
She added that Euromonitor is expecting Singaporeans to favour budget options and to spend more at independent hawkers and street stalls than in chain restaurants.
She said the closures of outlets are not the main problem. The “failure to hyper-localise” is. Hyper-localising entails tailoring menu items and operations to suit different locations and peak ordering times.
“And having a delivery channel is a must in today’s landscape,” she noted.
She said that although chain operators have fared better in recent years, Euromonitor believes that growth by independent food services – the independent operators and food stalls – will surpass that of chain operators in 2025.
https://www.businesstimes.com.sg/co...-fb-players-are-red-wilting-demand-high-costs
