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United Arab Emirates (UAE) Foodservice Market Size and Trends by Profit and Cost Sector Channels, Consumers, Locations, Key Players, and Forecast, 2021-2025

The foodservice profit sector in the UAE was valued at $5.9 billion in 2020. The market is projected to grow at a CAGR of more than 17% during the period 2021-2025.  In the profit sector, quick service restaurants (QSR) was the leading channel in 2020 followed by the accommodation; full-service restaurants (FSR); workplace and pub, club & bar. The military & civil defense segment dominated the cost sector, followed by education; healthcare; and welfare & services.

The foodservice market in the UAE declined significantly in 2020. The decline in the foodservice profit sector was due to a substantial reduction in the number of transactions in 2020 due to the closure of restaurants, cafés, and bars amid the COVID-19 pandemic. Tourism contributes to a significant share of transactions in the profit sector, especially in Dubai. The COVID-19 pandemic led to a drastic reduction in foreign tourist footfalls and thus, dented sales at bars and restaurants. Take -away and deliveries played a vital role in mitigating losses for foodservice businesses due to the convenience of contactless deliveries.

Overview of the foodservice market in the UAE

Overview of the foodservice market in the UAE

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What are the market dynamics in the UAE foodservice market?

Chain operators dominated the UAE foodservice profit sector in terms of market sales in 2020. However, in the long term, independent operators are anticipated to outperform chain operators and gain a higher market share. With more consumers preferring to stay at home during the pandemic crisis, the concept of cloud kitchen gained high popularity. Post-pandemic, the UAE profit sector channel will strongly bounce back during 2020-2025. In addition, the number of transactions will recover and grow too during the same period. While both dine-ins and take-away/delivery transactions will grow during this period, dine-ins will do so at a faster rate as consumers will opt for on-premises channels for social gatherings and meetings.

Lockdowns and restrictions on dining in restaurants and eateries along with the fear of COVID-19 infection, discouraged people to visit restaurants and other food joints as much as possible. As a result, consumers switched towards food delivery services to eat meals at home; 27% of respondents stated that they consume food using delivery daily, while 77% of respondents do the same at least once a week.

What are the sector classifications in the UAE’s foodservice market?

The foodservice market is segmented into the profit sector and cost sector. The cost sector typically represents the state’s foodservice operators while the profit sector represents the commercial operators.

Profit Sector:

Quick service restaurants market in the UAE

McDonald’s is the key player in the channel followed by two other American brands, Yum! Brands, Inc. and Doctor’s Associates inc. The sales value of the QSR channel is forecast to rise during 2020-2025, a significant rebound compared to the review period. The return to normality post-pandemic through vaccination programs is expected to help the recovery of consumer confidence for visits to public places, which will drive the growth of the channel. Online ordering and deliveries supported the QSR channel to mitigate losses to some extent during the COVID-19 pandemic. However, the major focus will shift back to dine-in services in the future.

Full-service restaurants market in the UAE

FSR was the third largest foodservice profit sector channel in the UAE. The channel remains fragmented and dominated by independents. Limited operational activities across dine-in along with the reduced inflow of tourists severely hampered the performance of the FSR channel. The channel’s foot traffic was negatively hampered as a result of low consumer confidence for frequent outdoor visits, which impacted the number of transactions across the channel. The closure of the restaurant, restrictions on social gatherings, and stringent COVID-19 lockdown protocols compelled consumers to stay at home and cut down frequent visits to fine-dining restaurants.

Coffee & tea shop market in the UAE

Starbucks, Krispy Kreme Doughnuts, Inc, and The Coca-Cola Company remain popular key players in the channel. Trendy Western coffee shop brands have resonated well with the country’s large expatriates, tourists, and young population. International brands remain highly popular among consumers. As a result, homegrown brands will continue to compete aggressively with international coffee brands such as Starbucks. Although take-aways are projected to experience rapid growth during 2020-2025, owing to a rise in affinity for convenience. However, Dine-ins will dominate over the coming years, motivating operators to focus on the development and introduction of new coffee outlets across the country.

Pub, club & bar market in the UAE

The UAE pub, club & bar market is forecast to rebound at a significant growth rate in 2025. The pubs, clubs & bars channel is projected to remain primarily focused on alcoholic drinks, but enhanced food offerings will enable the channel to compete more effectively across channel boundaries. Owing to the high average transaction value in the channel, consumers moved away from the channel in 2020, preferring at-home consumption amid the pandemic. The channel remains a highly fragmented channel in the UAE, with independent operators accounting for 100% of the channel’s total sales value in 2020.

Foodservice market in the UAE, by profit sector

Foodservice market in the UAE, by profit sector

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Cost Sector:

Healthcare foodservice market in the UAE

Healthcare recorded moderate growth in the number of transactions during 2015-2020. The category also registered modest growth in outlet numbers. The channel is expected to project significant growth during the forecast period.

Education foodservice market in the UAE

Education was the second-largest channel in 2020. The channel recorded a decline in outlet numbers during 2015-2020. Education, the second-largest channel, will register the strongest growth in the number of transactions projecting a high CAGR during 2020-2025.

Military & civil defense foodservice market in the UAE

Military & civil defense was the largest channel in the cost sector in 2020. Military & civil defense is projected to become the largest channel in the cost sector by 2025 owing to the growth in the number of transactions and outlet numbers during 2020-2025.

Welfare & services foodservice market in the UAE

Welfare & services registered an increase in both the number of transactions and the number of outlets during 2015-2020. The welfare & services channel is forecast to record growth in the number of transactions and in the number of outlets during 2020- 2025.

Foodservice market in the UAE, by cost sector

Foodservice market in the UAE, by cost sector

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Who are the major market players in the foodservice market in the UAE?

In the QSR channel, McDonald’s Corporation is the leading market player followed by Yum! Brands, Inc., Doctor’s Associates, Inc., CKE Restaurants, and Restaurant Brands International. Yum! Brands, Inc. leads the FSR channel followed by Brinker International Inc, Broccoli Pizza & Pasta, Hatam Restaurant, and Shakespeare & Co. Starbucks Corporation leads the coffee & tea shop channel followed by Krispy Kreme Doughnuts, Inc, The Coca-Cola Company, Restaurant Brands International, and Arcapita Inc.

QSR foodservice market in the UAE, by key players

QSR foodservice market in the UAE, by key players

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Market report scope

Market size of profit sector (Year – 2020) $5.9 billion
Growth rate of profit sector CAGR of >15% from 2020 to 2025
Base year for estimation 2020
Market segments by profit sector Quick Service Restaurants (QSR), Full-Service Restaurants (FSR), Coffee & Tea Shop, and Pub, Club & Bar
Market segments by cost sector Education, Healthcare, Military & Civil Defense, and Welfare & Service
Forecast period 2021-2025
Key players McDonald’s Corporation, Yum! Brands, Inc., Doctor’s Associates, Inc., CKE Restaurants, Restaurant Brands International. Yum! Brands, Inc., Brinker International Inc, Broccoli Pizza & Pasta, Hatam Restaurant, Shakespeare & Co., Starbucks Corporation, Krispy Kreme Doughnuts, Inc, The Coca-Cola Company, Restaurant Brands International and Arcapita Inc

This report provides a comprehensive analysis of the foodservice market in the UAE.

  • Overview of the UAE’s macro-economic landscape: Detailed analysis of current macro-economic factors and their impact on the UAE’s foodservice market including GDP per capita, consumer price index, population growth, and annual household income distribution.
  • Growth dynamics: In-depth data and forecasts of key channels (QSR, FSR, coffee & tea shops, and pubs, clubs & bars) within the UAE’s foodservice market, including the value of the market, number of transactions, number of outlets, and average transaction price.
  • Customer segmentation: Identify the most important demographic groups, buying habits, and motivations that drive out-of-home meal occasions among segments of the UAE population.
  • Key players: Overview of market leaders within the four major channels including business descriptions and number of outlets.
  • Case Studies: Learn from examples of recent successes and failures within the UAE foodservice market.

Reasons to Buy

  • Specific forecasts of the foodservice market over the next five years (2021-2025) will give readers the ability to make informed business decisions by identifying emerging/declining markets.
  • Consumer segmentation detailing the desires of known consumers among all major foodservice channels (QSR, FSR, Coffee & Tea shop, and Pub, Club & Bar) will allow readers to understand the wants and needs of their target demographics.

Key Players

Yum! Brands Inc.

McDonald’s Corporation

Doctor’s Associates Inc.

CKE Restaurants

Restaurant Brands International

Saleh Bin Lahej Groupy

Broccoli Pizza & Pasta

Starbucks Corporation

Krispy kreme

Costa Coffee

Tim Horton’s

Caribou Coffee

Table of Contents

Table of Contents

Introduction

Report Guide

Executive Summary

Macroeconomic Context

Macroeconomic Overview

Trends Landscape

Profit Sector Impact of COVID 19

Profit Sector Metrics

Key Metric Highlights

Value Share and Growth by Channel

Outlets and Transactions Growth by Channel

Operator Buying Volumes and Growth by Channel

Channel Historic and Future Growth Dynamics

Outlet Type and Type of Ownership Growth Dynamics

Quick Service Restaurant (QSR)

Summary and Key Take-Out

Metrics

Key Players

Who?

Why?

What?

Where?

What Next?

Coffee & Tea Shop

Summary and Key Take-Out

Metrics

Key Players

Who?

Why?

What?

Where?

What Next?

Full-Service Restaurant (FSR)

Summary and Key Take-Out

Metrics

Who?

Why?

What?

Where?

What Next?

Pub, Club & Bar

Summary and Key Take-Out

Metrics

Who?

Why?

What?

Where?

What Next?

Cost Sector Metrics

Cost Operator Trends – Historic and Future Growth

Data and Channel Share Breakdown

Appendix

Frequently Asked Questions

The foodservice profit sector in the UAE was valued at $5.9 billion in 2020.

The foodservice profit sector in the UAE is projected to grow at a CAGR of more than 17% during the period 2021-2025.

Key channels in the UAE’s foodservice profit sector include quick service restaurants (QSR), full-service restaurants (FSR), coffee & tea shop, pub, club & bar.

Key channels in the UAE’s foodservice cost sector include education, healthcare, military & civil defense, and welfare & service.

In the QSR channel, McDonald’s Corporation is the leading market player while Yum! Brands, Inc. leads the FSR channel. Starbucks Corporation leads the coffee & tea shop channel.

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