The industry is expected to perform marginally better over the next five years as the Canadian economy continues to improve and consumer confidence is restored. For these reasons, industry research firm IBISWorld has updated a report on the Full-Service Restaurants industry in its growing industry report collection.
Los Angeles, CA (PRWEB) December 13, 2013
The Full-Service Restaurants industry has exhibited slow, consistent growth over the past decade, but is recovering slowly from the worst global recession in nearly a century. Industry revenue declined 1.8% in 2010 as consumer confidence took a dive and restaurant goers tightened their purse strings. Since the recession, industry growth has been subdued as consumers seek more for their money when spending at restaurants. “Quick-service restaurants have outperformed full-service restaurants due to their more affordable prices and superior product development,” according to IBISWorld Industry Analyst Andy Brennan. Along with slow revenue growth, operators have been put under pressure by rising food prices, which have negatively impacted profit margins. Industry revenue is expected to advance 0.5% per year on average to $22.0 billion over the five years to 2013. In 2013 the industry shaky consumer confidence is expected to hold the industry back as industry revenue increases by just 1.2%.
The industry is highly fragmented due to the large number of small, independent single location restaurants in operation. Because there are limited economies of scale that can be gained from running more than one location, the industry's biggest players are all franchises and earn the majority of their revenue through royalty fees. For example, in 2013, the industry's biggest player, Cara Operations, purchased its main competitor, Prime Restaurants, which also demonstrates the industry's maturity. The combined operation now commands 7.7% of the industry's market share and has eight chains under its purview.
The industry is expected to perform marginally better over the next five years as the Canadian economy continues to improve and consumer confidence is restored. “Consumer spending is likely to grow at a much faster rate over the five years to 2018, driven by lower unemployment and disposable income growth,” says Brennan. Corporate profit, which allows businesses to allocate greater amounts to entertain clients and prospects at restaurants, is also expected to improve. Furthermore, strong growth in the number of households earning over $100,000 per year will lead to greater spending in the high-end segment of the industry.
For more information, visit IBISWorld’s Full-Service Restaurants in Canada industry report page.
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IBISWorld industry Report Key Topics
The industry includes restaurants that provide food services to patrons who order and are served while seated (i.e. waiter or waitress service) and pay after eating. These establishments may provide this type of food service to patrons in combination with selling alcoholic and other beverages.
Key External Drivers
Industry Life Cycle
Products & Markets
Products & Services
Globalization & Trade
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Barriers to Entry
About IBISWorld Inc.
Recognized as the nation’s most trusted independent source of industry and market research, IBISWorld offers a comprehensive database of unique information and analysis on every US and Canadian industry. With an extensive online portfolio, valued for its depth and scope, the company equips clients with the insight necessary to make better business decisions. Headquartered in Los Angeles, IBISWorld serves a range of business, professional service and government organizations through more than 10 locations worldwide. For more information, visit http://www.ibisworld.com or call 1-800-330-3772.
For the original version on PRWeb visit: http://www.prweb.com/releases/2013/12/prweb11418766.htm