Cafés/bars in South Korea continued to experience a strong current value decline in 2021, following an already significant decrease in 2020, during the prolonged pandemic period, although the rate of decline did slow. Plummeting sales were mainly driven by a continued night curfew on business hours for cafés, bars and restaurants, alongside a reduction in the size of private social gatherings.
Home drinking and the home party culture have been trending amongst the younger generation due to the government’s regulations on private social gatherings. This was another factor negatively impacting the performance of bars/pubs during the pandemic.
During the COVID-19 outbreak consumption patterns changed, leading to the surging popularity of specialist coffee and tea shops. Drinking coffee after meals has become a daily habit, although instead of drinking coffee in the store, takeaway and home delivery have become more prevalent.
While the overall cafés/bars channel continued to lose value sales in 2021, resulting mainly from the significant downturn in bars/pubs, despite an uptick in cafés and specialist coffee and tea shops, current value sales are set to rebound strongly, especially in 2022 and 2023, as social distancing curbs are lifted. In particular, after seeing the strongest decline during the pandemic, bars/pubs is expected to record the most significant rate of recovery over the early forecast period, due to the expectation of a gradual transition back to normality.
Espresso bars, which specialise in selling espresso-based menus, are on the rise around metropolitan areas, with more potential to expand nationwide. The characteristic of the espresso is fast-casual, which narrows the product variety, with only a couple of espresso-based drinks available.
Other than the quality of the coffee, unique offerings are becoming a competitive edge to differentiate brands, due to the mounting competition in chained specialist coffee and tea shops. For example, Angel-in-us Coffee, operated by Lotte GRS, started to sell Vietnamese ban-mi sandwiches on its food menu.
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This category encompasses all establishments where the focus is on drinking (either alcoholic or non-alcoholic beverages). While a wide variety of snacks and full meals are offered, it is not uncommon for consumers to only order a drink. As a general rule, establishments deriving 50% of their income or more from the sale of drinks are included here.See All of Our Definitions
This report originates from Passport, our Cafés/Bars research and analysis database.
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