Full-service restaurants in Hungary was the worst hit consumer foodservice channel by pandemic-related restrictions, economic fallout and lack of tourism, leading to the highest fall in value sales in 2020. The channel struggled to fully recover in 2021 as the beginning of the year brought the same challenges and problems that these operators had already faced, although the dominant independents recorded a much stronger performance compared to chained operators despite further closures.
Full-service restaurants is traditionally dominated by eat-in sales, as consumers appreciate the occasion and the attention they receive when visiting these establishments, compared to a quick bite to eat from alternative options. Therefore, the offer of home delivery or takeaway was less developed compared to limited-service restaurants up until 2019, but the emergence of the pandemic and related restrictions meant that operators had to quickly adapt to avoid more significant losses through physical outlets.
Most full-service restaurants with a strong focus on business travellers, wealthy tourists and fine dining enthusiasts were particularly hard hit as a result of the pandemic and related restrictions, with many remaining closed in 2021 as their target audience remained largely absent. Moreover, with the economic fallout of the pandemic making Hungarians more price sensitive, these establishments held limited appeal for local consumers during the summer months, when foodservice outlets were able to operate without major restrictions.
Similar to other consumer foodservice channels, the future prospects for full-service restaurants are determined by the threat level of the pandemic and the management of possible new variants emerging over the forecast period, which will influence the pace of a return to some level of normality in terms of footfall, tourism and consumer sentiment linked to disposable incomes. Therefore, a full recovery for full-service restaurants is predicted to be slower compared to other channels, with value sales (at constant 2021 prices) not predicted to return to pre-pandemic levels until 2024.
Full-service restaurants is predicted to record further double-digit value growth (at constant 2021 prices) over the early part of the forecast period, with local consumers likely to be keen to celebrate and compensate for home seclusion by eating out in these establishments with family and friends. This behaviour will be further encouraged by any improvements in consumer confidence and spending power as the easing of the pandemic drives recovery in the Hungarian economy.
Despite predictions for a full recovery in value sales and transaction terms over the forecast period, the dominant independent operators will likely fail to recover in outlet terms due to struggling financially during the pandemic, while chained operators, albeit from a lower base, are set to recover in outlet numbers by 2023. The pandemic generated massive losses for full-service restaurants, which could potentially lead to a change in outlet ownership.
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FSR (full-service restaurants) encompasses all sit-down establishments where the focus is on food rather than on drink. FSR is characterized by table service and a relatively higher quality of food compared to quick-service units. Menus offer multiple selections and may include breakfast, lunch and dinner. Preparation of food products is often complex and involves multiple steps. NOTE: restaurants types catalogued in this segment refer to table-service only (outlets with a proper “full table service:” wait staff attending customers and taking orders at the tables). Outlets with “limited table service” are excluded from FSR. For example: outlets where customers order their food at the counter are excluded (even though the waiter will then bring the food at the table).See All of Our Definitions
This report originates from Passport, our Full-Service Restaurants research and analysis database.
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