Limited-service restaurants was able to deliver a relatively good performance compared to other consumer foodservice channels during the COVID-19 pandemic, benefiting from strong consumer demand for home delivery and takeaway, as eat-in services were suspended during the lockdown periods. Drive-through demand also increased, although with fewer consumers driving due to the pandemic, the impact was less significant than for home delivery.
Both chained and independent limited service restaurants encouraged delivery and takeaway orders in order to ensure social distancing during the pandemic. To expand their reach and avoid losing ground to competitors that had already taken similar action, limited-service restaurant chains in Canada are increasingly working with third party food delivery operators such as Just Eat, Uber Eats, SkipTheDishes and Foodora.
Many limited-service restaurant chains switched to drive-through and curb side pick-ups as the COVID-19 epidemic raged on. Restaurant Brands International, the parent company of Burger King, Popeyes and Tim Hortons in Canada, launched a new drive-through service in select Tim Hortons outlets during the pandemic.
Limited-service restaurant sales are set to return to strong double-digit constant 2020 value growth in 2021, followed by good, if declining, growth rates over the remainder of the forecast period. Even so, actual value sales will not surpass pre-pandemic levels until 2023, such was the impact of the COVID-19 pandemic and the lockdown measures.
Online sales of limited service restaurants will remain high in 2021 as many Canadians continue to avoid eating out for health and cost reasons in the immediate future. Sales will however, decline over the following two years as many begin to venture out again, before returning to growth over the latter part of the forecast period.
Large chained limited-service restaurant brands, such as Domino’s Pizza, Tim Hortons and Popeye’s are expected to gain stronger positions over the forecast period as they continue to expand. Reinventing themselves by leveraging technology and innovation, these operators are adopting a wide range of strategies involving targeted promotions and personalised marketing through social media engagement on popular platforms such as TikTok.
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