Latin America Fast Food and Quick Service Restaurants Market 2022-2028

Latin America Fast Food and Quick Service Restaurants Market 2022-2028

Market Overview

The fast-food service providers can be divided into full-service restaurants, fast food outlets, caterers, cafeterias, and other places that prepare, serve, & sell food to the general public for a profit. A quick service restaurant (QSR) is a fast-food outlet where people pay for food at the counter before consumption. It is a specific type of restaurant that serves fast food cuisine and has minimal table services. QSRs have both fast-food cuisines and small table services to cater to youngsters' and working professionals' requirements. A fast-food restaurant is also known as a QSR within the industry. The Latin America fast food & QSR market is anticipated to grow at a CAGR of 6.9% during the forecast period (2022-2028). The market value was around $25.3 billion in 2021 and $26.9 billion in 2021. The growing trend towards improved convenience and good taste at an affordable rate along with less time acts as a major factor that propels the market growth during the forecast period. Furthermore, the QSRs and fast-food restaurants have been evolved as major providers of various mass-produced food items such as pizza, burgers, and others, which is gaining traction of majority of the regional population towards experiencing the services. For instance, according to the case studies of Pizza Hut, the company sold around 91,250 pizzas by December 2021 across the region.

Moreover, the increasing inclination towards the adoption of healthier food products is pushing major market players such as Domino’s, Yum Brands Inc., and others to produce healthier fast-food items. For instance, in January 2021, Domino’s launched healthier pizza in the market with 100 calories per slice. Through this product launch, the company aims to cater to vegan and health-conscious customers of the region.

However, the outbreak of COVID-19 across the globe has severely impacted the food and beverage industry, owing to the closure of all the fast-food chains and stores across the globe. Several major fast-food restaurants witnessed a huge setback in terms of revenue and growth. According to the report published by Restaurant Business in 2021, Pizza Hut experienced a decline in overall Y-o-Y sales by 2.2% in 2021. Pizza Hut's declining sales were majorly due to the pandemic, which closed several locations across the Latin American region.

IMPACT OF COVID-19 ON THE LATIN AMERICA FAST FOOD AND QUICK SERVICE RESTAURANTS INDUSTRY

Latin America has faced substantial losses in several industries owing to the outbreak of COVID-19 since March/April 2021. The COVID-19 outbreak resulted in adversarial impacts on the markets of Latin America, following the temporary closure of hotel chains, restaurants, and work from home scenarios. In addition, in the initial months of the outbreak, the governments of different countries mandated the closure of malls, theatres, nightclubs, and others in most states thereby affecting the restaurant businesses in such malls in order to promote the practice of social distancing. Although, as the social distancing norms eased, the restaurants started to open gradually, this initiated the change in momentum for the fast food and quick service restaurants industry in Latin America.

Moreover, due to the forced shutdown of restaurants, numerous brands took various steps to overcome the losses that have been incurred during the lockdown. For instance, MUY has more than 30 restaurants in Bogota (Colombia), and four in Mexico City. In August (2021), it opened its first “contactless store"" in a commercial district of Bogota, where many restaurants have been forced to shut down because of a ban on sit-down dining. The automat's main lobby is lined with colorful touch screens on which customers order their food. Another screen informs people when their order is ready and directs them to small cubicles where they can pick up their hot meals in bags. Machines take payments in cash or from credit cards. The machines also track how much of each ingredient is being requested, helping the company to reduce inventory. With this move, it is expected that more companies will follow and introduce such services in order to gain pre-COVID-19 momentum, in the near future. Leading players such as Domino’s and McDonald’s are also focused on providing a safe and hygienic offering, better user experience by the use of technology, diverse and more affordable options, and multiple convenient delivery formats.