Abstract
Why buy this report
- Get insight into trends in market performance
- Pinpoint growth sectors and identify factors driving change
- Identify market and brand leaders and understand the competitive
environment
Product coverage
Consumer foodservice by chained/independent; Consumer foodservice by type;
Consumer foodservice by type and chained/independent
Executive summary
Sales growth slowdown in 2006
CFS continued to experience robust growth across its sectors, but at slower
rate in 2006 than the previous two years. Sales experienced a small decrease
over the fourth quarter of the year, due to the impact of the deceleration of
the economy and the effect of the new tobacco law, resulting in slower growth
than expected.
Nevertheless, the overall scenario appears highly favourable for CFS.
Chileans' busier lifestyles, more working women, an increase in independent
living and higher disposable incomes were the main reasons for sales
improvement. 100% home delivery/takeaway and self-service cafeterias showed
the best results, due to growth from a small base.
Tobacco law damages sales
A new tobacco law was implemented in September 2006. The law negatively
impacted CFS because it obliged CFS operators to choose between serving
smokers or non-smokers in outlets smaller than 100m2, and remodelling with
sales areas larger than 100m2 to separate the two groups. In the case of
closed public areas, such as shopping centres, it is also forbidden to smoke,
affecting CFS operators located on these premises. CFS units located in
shopping malls therefore recorded a dramatic fall in sales, both in food and
drink, as well as tobacco.
Chains expand to mid-sized cities
The economic conditions of middle and lower income segments improved, and a
growing number of Chileans can now pay for a wide range of services which had
been out of their reach, or were used only sporadically. CFS is one service
which is benefiting from the improving economic conditions, and has fuelled
the expansion of chained restaurants to mid-sized cities and to middle and
lower income neighbourhoods. At the same time, improvements in purchasing
power have encouraged the development of shopping centres nationwide,
generating space for CFS expansion in high traffic locations. Chained CFS
players especially, have made shopping centres a key part of their growth
strategy.
Food retailers provide better options for price-oriented customers
The leading food retailers, Cencosud and Distribución y Servicios D&S,
invested in extending their reach to consumer foodservice by introducing
self-service cafeterias, coffee shops and improving their offering of
take-away dishes. Supermarkets/hypermarkets have emerged as the ideal base for
the expansion of self-service cafeterias, and the chains have adjusted the
foodservice offering according to the particular conditions of each location.
Self-service cafeterias generally provide a full range of home-style meals at
highly affordable prices; these outlets cater for workers in areas where there
are few affordable foodservice options.
Healthy trends drive development in Asian food
Chileans are increasingly concerned about the impact of dietary habits on
their health, and are in search of food alternatives which can help them to
feel better and avoid obesity. Slowly, CFS units have incorporated more dishes
based on vegetables, fruit and white meat into their menus. The trend has not
only impacted menu design, but has also fuelled the demand for healthier food.
As a result Asian food became a fad, especially Chinese and Japanese cuisines.
In its initial stages, FSR was the main channel benefiting from the interest
in Asian-style menus, but by 2006 the presence of Asian food in fast food and
100% home delivery/takeaway recorded robust growth.
Wendy' s enters the market to challenge McDonald' s
Wendy' s has announced plans to enter the Chilean market, and should challenge
McDonald' s leadership in burger fast food. The firm is looking for a partner
to develop the franchise in Chile. Preliminary plans include opening 30
outlets, with the first outlets opening in 2008.
Tourism and new casinos benefit performance
Up to the end of the review period tourism was reinvigorated, as private and
public players allocated resources to improve the tourist offering and to
promote the country as destination for long-haul and business travellers. The
investment is spread out across the country, and much accommodation has been
built, including several four and five star units. Premium restaurants
associated with them have opened, which contributed to a rise in industry
standards.
Additional impetus is associated with the 17 new casinos which should be
opened in the next two years. In January 2007, the government granted 17
licenses for casinos nationwide, which raises the number of outlets authorised
to operate in the country to 24. Some of the factors considered when assigning
the licenses were the impact of the casinos on tourism in the area, as well as
hotels, restaurants and other foodservice units. The expansion of casinos
should benefit the development of CFS in underserved areas of Chile.
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