In the upcoming final period of 2021, the full-service restaurant industry will be supported by the government’s conditional relaxation of lockdown restrictions effective November 1, 2021. As a result, more people will dine out and spend money at restaurants, and may increase sales of food and alcohol, making revenue of the full-service restaurant business approximately THB2 billion higher than the prior estimate, with a full-year turnover of up to about THB113 billion, down by 28.5% YoY.
Looking into 2022, KResearch sees two scenarios for the recovery of the full-service restaurant industry: 1) Base case: If the COVID-19 situation improves, the number of new cases gradually declines, vaccination covers most of the population as planned, consumers have more confidence and the government gradually reopens the country. In this case it is expected that turnover in the full-service restaurant industry may reach approximately THB143 billion, an increase of 26.5%YoY; 2) Worst case: If there is a resurgence in COVID-19 and related containment measures are tightened with no dining-in permitted at restaurants, but the same time no lockdown measures are imposed, it is expected that turnover in the full-service restaurant industry will reach around THB129 billion, an increase of 14.2% YoY.
In 2022, the full-service restaurant industry is expected to revive, driven by investment by major operators that will accelerate after being delayed in 2021 and accelerated expansion of food offerings to more food categories. Meanwhile, small-medium restaurant operators are expected to continue to operate cautiously and wait for the return of mass customers. Despite improvements foreseen in the restaurant industry, full-service restaurant businesses still face challenges such as higher operating costs (including rising food ingredient and utility costs) plus costs related to maintaining hygiene standards and disease screening, which may put pressure on net profit, revenue, liquidity and financial positions. Therefore, full-service restaurant operators need to adjust their business models in line with the changing trends, and to use a combination of online and offline sales and marketing channels, so that customers can access products and services through a variety of channels.
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