The pandemic adversely impacted full-service restaurants due to the policies prohibiting dine-in customers, as well as social distancing measures limiting the maximum number of patrons allowed in a restaurant at any given time. High rents and operational costs also added to the pressure felt by operators from the pandemic.
The outbreak of COVID-19 in 2020, put even more pressure on the foodservice industry, with full-service restaurants recording a significant value decline of 15%, compared to growth of 2% in 2019. As a consequence of the pandemic, outlets reduced by 6% in 2020, with changing consumer preference also playing a part in the downfall of some restaurants, including Sizzler.
Due to the outbreak of COVID-19 in 2020, transaction growth for full-service restaurants recorded a 15% decline, with restrictions and price-sensitivity in the country impacting this result. However, as well as players implementing new services such as apps and delivery systems, many also responded to consumers heightened interest in health and wellness, throughout the pandemic period, with many consumers keen to remain as fit and healthy as possible.
Full-service restaurants are expected to gradually recover over 2021 and 2022, as Australia has done relatively well in containing the virus over 2020. In addition, many full-service restaurants have adapted their strategies to include delivery and takeaway services, enabling them to remain open.
Across the forecast period, full-service restaurants are set to rethink their strategies and use of space, to reduce occupancy costs and optimise profit margins. Many players will look to install larger tables and give more distancing between consumers, encouraging visitors to return to venues.
The ethical food movement, which is already significant in parts of Australia, such as Melbourne, is showing no sign of fading and is set to increase across the forecast period. Sustainable and fair-trade food movements are expanding and now extend well beyond their previously niche appeal.
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Understand the latest market trends and future growth opportunities for the Full-Service Restaurants industry in Australia with research from Euromonitor International's team of in-country analysts – experts by industry and geographic specialisation.
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