Casual dining has been around as long as the concept of eating out has existed. It has always held a large market share, falling nicely between fine dining and quick service restaurants. So, let’s look at what casual dining really is, why some question its sustainability after 2020, why people go out in the first place, and how casual dining restaurants must adapt to be successful in 2021.
For those unfamiliar with restaurant classifications:
Fine dining has been fading for many years, as more and more people are choosing nice casual restaurants which offer better value for money. However, with the events of 2020, specifically the Corona virus, many people claim the market share domination casual dining has always held will also fade. With the increased importance of delivery and take-away and the advantage that gives QSR and Pizza restaurants, this is not an unreasonable concern. I will admit that in my own family and group of colleagues, we temporarily have decreased restaurant visits and increased QSR delivery.
BUT, I will put forth the claim that this is a temporary situation. Let’s look at why.
A recent survey done by the website FinanceOnline provides some interesting facts about people’s behavior and desires. Of particular note is the “Consumer attitudes toward restaurants” chart which shows:
It also shares that 52% of consumers prefer to spend money on an experience, and that Americans spend 6% of their total budget on going to restaurants.
These statistics help highlight some of the reasons we go out to casual dining restaurants. It’s only partially for the food. We go to relax, enjoy a variety of ambiances, spend quality time with family and friends, and as a big part of our weekly “entertainment”. All with the added benefit of not having to cook and clean up at home. We also go to experience new cultures and food and casual restaurants are far more suitable for this type of experience than fast food restaurants. QSR and fast casual restaurants simply don’t fulfil these needs and wants like casual dining restaurants.
Using South Korea as a sample economy, Statista a popular research company shows year on year continual growth for casual dining restaurants that is expected to continue with a huge jump in 2022. There is absolutely no expectation that casual dining growth will slow in the Korean market.
But the world has changed. It doesn’t matter if you live in South Korea, Thailand, Vietnam, China, Japan, Australia, big city or small town, Western or Asian country, first world nation or developing country. This is a fact we all need to recognize and accept. So, how must casual dining restaurants adapt to be successful in 2021?
Let’s examine one of the world’s best known casual concepts; Chili’s. Founded more than 45 years ago in Texas, Chili’s and its parent company, Brinker International, have more than 1600 locations in 30 countries worldwide. If you look at their website today, you will find it very different than a year ago. www.chilis.com
First, we notice “all guests get free delivery”. An obvious focus on delivery is present with an efficient online ordering system, which lets you easily reorder your favorites quickly and conveniently while having them delivered right to your home or office. Even their delivery menu has changed to provide contactless curbside pickup right into your vehicle’s trunk or backseat without any personal interaction.
While us laymen might think offering a menu for delivery is a simple change, it isn’t. Packaging needs to be carefully considered, menus need close review as many types of food do not travel well, disposable condiments and utensils need to be sourced and purchased, and many other variables need to be carefully considered. The restaurants that do this well can keep this delivery and take-away market share that they have gained. Those that do it carelessly will alienate their customers as customers turn to competitors.
Digging a bit deeper on the Chili’s website, we also noticed, “We’re opening our dining rooms with safety as our priority” message with images of Chili’s staff hard at work ensuring the restaurants are sanitized between guests. Advertising things like “Proud partner of Ecolab” and “There are less tables and more social distancing”, while never heard of in 2019, will remain key messages for Chili’s likely far into the future. People WANT to get back to restaurant dining, but they also want to remain safe while doing so. Again, those casual dining restaurants who do a good job of making their customers feel safe will attract them back to their locations and keep them coming back.
In conclusion, don’t worry your favorite casual dining restaurants will not only re-open if they are currently closed, but they will continue to expand and grow in the upcoming years. For those looking to invest in F&B concepts, casual dining still remains a sweet spot and should remain so for years to come.
There are many great casual dining brands that are actively seeking expansion in Asia. To see some available in your country, check out our website:
Robert Beausoleil is a franchise broker and has been visiting Asia for 25 years, and has lived in Vietnam for more than 12 years. He works as the Director of Business Development and Franchise Operations for VF Franchise Consulting. He has extensive experience in franchising, both for franchisors and franchisees. You may contact him at [email protected] or on LinkedIn.