24 Jun 2021
Posted in Foodservice
India’s foodservice profit market to witness strong growth rate through 2025 with ‘home deliveries’ playing a key role, says GlobalData
Indian foodservice profit sector is forecast to grow strongly at a compound annual growth rate (CAGR) of 15.5% from INR8,366.6bn (US$117.5bn) in 2020 to INR17,220.3bn (US$219.4bn) in 2025. Increasing affinity among the consumers for home deliveries will drive the growth of delivery service providers like Zomato, which will be instrumental in pushing up the overall growth of the profit sector in the coming years, says GlobalData, a leading data and analytics company.
GlobalData’s report, ‘India – The Future of Foodservice to 2025’, reveals that the quick service restaurant (QSR) channel remained the largest foodservice profit sector channel in 2020. At a CAGR of 5.5%, the channel registered the steepest growth among all profit sector channels. Growing popularity of the western fast food owing to its affordability and the increasing exposure of consumers to western media drove the QSR sales.
The travel channel recorded the sharpest decline at a CAGR of -5.5% during 2015–2020. However, with the rebound in consumer confidence in coming years post COVID-19, all profit sector channels are projected to register growth during 2020–2025.
Ravi Teja, Consumer Analyst at GlobalData, says: “A drastic drop in the purchasing power of consumers and restrictions on operations of on-premise channels played a key role in the decline of sales across different profit sector channels.”
GlobalData forecasts that all foodservice profit sector channels will experience outlet and transaction growth during the forecast period. Chain operators will grow at a higher rate compared to independent operators across restaurant channels.
Mr concludes: “Owing to a shift in consumer eating patterns during the pandemic, the profit sector is expected to witness the introduction of new formats like cloud kitchens, which are designed for takeaways.
“In the future, the foodservice industry’s dependence on technology will increase, with technological advancements featuring prominently in every stage of foodservice operations, from supply chain management to delivery. Operators will increase the share of takeaways in their revenues to cut their own real estate expenses and serve consumers seek convenience.”