Limited-Service Restaurants in Taiwan

PROSPECTS

Increasing dining out frequency boosts demand for cheaper dining options

Taiwanese consumers eat out very often, as a wide range of restaurant types and price points are available. In recent years, demand for dining out has continued to rise, due to busy lifestyles and smaller family sizes, caused by a low birth rate and later marriage.

Rising labour costs boost the number of limited-service restaurants

Labour costs in Taiwan have been increasing since the implementation of the labour law amendment in 2018, which introduced a stricter definition of overtime and a higher level of compensation. Labour-intensive foodservice was one of the most impacted industries, as restaurant owners had to pay extra to staff, reducing the already low profit margins.

Convenience stores strengthen their limited-service restaurants business

Owing to busier lifestyles, convenience stores have become an increasingly popular dining option. The dense coverage of chained convenience stores and 24-hour opening hours have underpinned convenience stores’ importance in foodservice in Taiwan.

COMPETITIVE LANDSCAPE

Convenience stores partner with restaurants to attract consumers

As more consumers resort to convenience stores for meals, chained convenience store brands in Taiwan have sought strategic partnerships with well-known restaurants to attract consumers. For example, the convenience store chain Hi-Life has partnered with the well-known Taiwanese chained restaurant Formosa Chang and launched Formosa Chang Stirred noodle in 2019.

Burger limited-service restaurants embrace the fast-casual concept

Fast food is embedded in Taiwan’s dining culture and has become a common choice for daily meals. In the past, consumers often visited chained burger limited-service restaurants, such as McDonald's, for fast food, due to the high brand awareness and large number of outlets.

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