The year 2022 will be yet another year wherein restaurateurs have to exercise caution in their operations, as the market is still exposed to risks from the Omicron variant of COVID-19 while consumer purchasing power has yet to fully recover. However, restaurants will still benefit from government’s economic stimulus measures such as the fourth phase of the co-payment scheme. Given this, KResearch projects that the total turnover in the restaurant business will reach THB 378-396 billion in 2022, an increase of 5.0-9.9%, against the contraction of 11% reported for 2021 (partly due to the rising food costs and soaring inflation). However, growth will be seen in specific categories or types of restaurant because of specific factors, as follows:
1) Full-service restaurants will see an accelerated growth from last year’s low base. Those restaurant in shopping malls and well-known restaurants, as well as those located in tourist areas are set to recover first. Their total turnover is expected to reach THB 131-142 billion, an increase of 10.0-19.5%;
2）Limited-service restaurants will see an expansion, as well, thanks to the opening of new branches for fast food operators and an uptick in the number of small limited-service restaurants, compared to those reported for 2021. These restaurants tend to target and operate in residential zones and petrol stations in Bangkok and its vicinity and across major provinces in Thailand. Their total turnover isexpected to reach THB 64-68 billion, an increase of 4.6-11.8%; 3) Street food restaurants will continue to grow, supported by the government’s co-payment program. Their turnover may total around THB 184-186 billion, an increase of 2.0-3.0%.
Important and interesting trends in the restaurant business during 2022 are: 1) persistently high operating costs throughout the year, but operators may find it difficult to raise prices, thus putting pressure on their net profit especially energy and ingredient costs; 2) operators have adopted a small-size restaurant model in order to reduce costs and potential risks while using technologies in their supply chains; 3) major businesses in and outside the restaurant industry are expected to increase their investments in restaurants in the Bangkok Metropolitan Region, as well as other provinces – particularly those with the most populated residential areas; 4) risks associated with COVID-19 has prompted restaurant operators to maintain the balance between managing their sales channels and expanding revenue streams to more products.
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