Dubai: Consumer behavior in UAE’s food and beverage (F&B) sector underwent a near-term “dramatic shift” during the pandemic, said KPMG in a report.
The majority of consumers reduced dining out and ordering in during the pandemic, said KPMG. While over half of the respondents plan to resume pre-pandemic dining out habits by early 2021, the vast majority expect to stay home or scale back on eating out through to the last quarter of the year owing to health and hygiene concerns, it added.
“Consumers across the (GCC) region continue to demonstrate value-seeking behavior, compelling operators to incorporate deals and promotions as a key tactic,” said Anurag Bajpai Head of Consumer and Retail at KPMG Lower Gulf. “While most consumers surveyed expect to resume their pre-pandemic dining habits by early 2021, several operators in the GCC appear to be bracing for hard times, with most expecting reduced sales through mid-2021”
According to KPMG, Saudi Arabia’s recent policy changes present an “interesting and evolving” opportunity that is drawing operators’ attention. “While short-term expectations have been hampered by Covid-19, Saudi Arabia is still the next frontier in the region for F&B operators,” said Bajpai.
Kuwait, launchpad of the region’s most prominent home-grown concepts, paints a picture similar to the UAE. It boasted the highest spend on delivery in the region in 2019.
Oman, despite being the smallest F&B market in the GCC, has fared marginally better than the UAE and Kuwait on the back of growth in consumer demand in the run up to the pandemic.
“Recovery may prove tricky - however, operator performance through recent downturns indicate that those who can hone their strategy, test their methods, and remain afloat throughout the potentially lean periods will enter the recovery poised for expansion,” said Bajpai.