UAE Restaurent Analysis

Food-Service Market –
UAE
Prepared By:-
S.A.Rahman
Table Of Conte
Industry Analysis 3
Industry Analysis - Overview 4
Industry Segments 6
Industry Trends & Developments 7
Key Players – Hotel Segment 9
Key Players – Fast-Food Segment 10
Factors Supporting The Market 11

Growth
Factors Affecting The Industry 12
Growth
nts (1/2)
Table Of Contents (2/2)
Market Analysis 14
Fast Food Market - Overview 15
Largest Food Product Groups 16
In-Demand Food Categories 17
Food-Service Channel 18
Customer Analysis 19
Demographic Trends 20
Consumption Trends and 23

Patterns
Industry Analysis
Industry Analysis -
Overview (1/2)
Industry Size(B illion Dh)
The value of food and non-
alcoholic beverages purchased
by the UAE (UAE) foodservice 7 CAGR –
sector is currently valued at 11%
Dh5.25 billion (US$1.43 billion) 6
in wholesale prices in the year
6.47
2004 5 5.83
In consumer values, the UAE 5.25
foodservice market is worth a 4
massive Dh16 billion (US$4.36
billion) in the year 2004 3
The total value of spending in
UAE's food industry is estimated 2
to have exceeded Dh 6.47 billion
(in wholesale prices) in 2006 1
0
2004 2005 2006
*Above mentioned figures are taken from the study by BIS Shrapnel: Foodservice in the
Industry Analysis -
Overview (2/2)
The UAE food services market is estimated to have grown at
11 % in 2005 and 2006 and the growth is likely to be
sustained in the future as well, according to the “Foodservice
in the Middle East — the UAE, 2005–2006”
Food Service Industry in the UAE due to its sharp growth, has
witnessed a growing demand for food ingredients due to an
increased appetite for Western-style foods, agrowing
population and tourism, this in turn is attracting
manufacturers of food products and services from across the
globe, in particular the food sector
Industry Segments
The UAE Food Services Industry is segmented into three major
segments. Namely:-
Food-Service
Industry
Other Market Outlets:-

Retail Outlets:- It included ship chandlers, catering etc.,
This segment strives on
the resident expat Hotel And
community which, in Restaurant:-
turn, represents 80% of
tourist/business visitors
the population base
which (along with
healthy portion of the
resident expat
community) fuel a
vibrant and growing
hotel and restaurant
sector
Industry Trends &
Developments (1\2)
The growth in the UAE food services market may be
attributed to several factors, including:-
– Growing population,
– Significant rise in the number of tourists visiting the country,
– Increase in the number of hotels
– Increase in tourist in-flow
The UAE had around 7 million tourist arrivals in 2007
according to UNWTO
– Studies indicate that the total spending by tourists in the UAE
will reach $7.6bn in 2009
– In 2009, the number of international tourists is expected to
decline due to the global economy crisis
Industry Trends &
Developments (2\2)
26% of UAE residents eat out at a quick service restaurant at least once a
week, with the frequency of visits to this type of outlet being some 65%
higher among Emiraties and expat Arabs
Dubai and Abu Dhabi account for 80% of total foodservice demand amongst
the seven Emirates
Quick Service Restaurants (QSR) sector is attracting more international
names due to the fact that the UAE has been able to register double digit
growth year on year for the last five years
Key Players – Hotel
Segment
Leading Up-Market Hotel Groups Ranked by Number
Company
ofNumber
Restaurants
Of Hotels Approximate Number Of
Restaurants
Jumeirah International 8 100
Le Méridien (Starwood) 8 80
Sheraton Hotels and Resorts(Starwood) 7 66
Rotana Hotels 7 50
InterContinental/Crowne Plaza 6 41
Hilton 8 40
Hyatt 3 36
Al Habtoor Group (Metropolitan Group of 4 30
Hotels)
Kempinski 3 30
Radisson SAS Hotels and Resorts 4 30
Jebel Ali International 3 20
Marriott 3 10
The One and Only Royal Mirage 1 7
Key Players – Fast-Food
Segment
Leading Fast-Food Chains
Compan Number Of Outlets Number Of Average Transactions
y Per Day
KFC, 62 (13 in Sharjah) Not Available
McDonald's 60 700 to 800
,
Burger 19 restaurants (4 in Sharjah) 500 to 550
King,
Pizza Hut, 12 (3 in Sharjah) Not Available
The number of stand-alone restaurants exceeded 11,000, serving both
residents and tourists and is growing by 5% every year.
Over the last 10 years, a number of new (mainly US based) fast food restaurant
franchises and other food service establishments including coffee and speciality
dessert purveyors, entered the market.
There are 4,250 restaurants & cafeterias operating in Dubai, 3,000 in Abu
Dhabi, and 2,775 in Sharjah (according to MEF Magazine , October 2008).
Factors Supporting The
Industry Growth
Population growth, currently averaging over 7% per annum
Rising rates of private consumption expenditure which also have the effect
of driving up Food-Service expenditures
Three-quarters of the population are non-nationals, with a large
percentage of this segment being male bachelors (in fact, males
outnumber females two-to-one)
Given the prevalent working lifestyle, most people are compelled to eat at
least one meal per day while at work
The impact of tourists visiting the country annually
One single Hardee’s outlet sells 20,000 burgers per day
Factors Affecting The
Industry Growth
The number of international tourists is expected to
decline due to the global economy crisis
50% of the UAE population are low paid expatriate
workers brought in to work in the booming hotel and real
estate construction industry and are not relevant to the
high value food service industry, or the modern retail
supermarkets
Market Analysis
Fast Food Market -
Overview
The UAE imports over 80% of its food products(2006)
Approximately 50% of imported products are re-exported
to GCC* countries, former Soviet states, the Indian Sub
Continent and Eastern Africa(2006)
The UAE Fast Food Market is valued at USD$ 117
million in the year 2006
Fast food outlets in UAE is 315 in 2006
It is estimated that 26% of UAE residents eat at a fast
food outlet at least once a week
*Gulf Co-operation Council (GCC) comprises of 6 countries, namely: Bahrain, Kuwait, Oman, Qatar,
Kingdom of Saudi Arabia, UAE
Sources: “UAE food services market valued at Dh6.47b”, gulfnews.com, March 08, 2008, April 15, 2009, <http://www.gulfnews.com/business/Commerce/10195778.html>.,
“Malaysia seeks to leverage USD 5.52 billion food services market in the UAE”, arabwideweb.com, September 16, 2008, April 15, 2009, <http://www.arabwideweb.com/english/Events_News.asp?id=13>
Largest Food Product
Groups
“Foodservice in the Middle East — Food Groups purchased by Fo
the UAE, 2005–2006” says the four
largest product groups purchased Service Operators
by foodservice operators are
– Meat, poultry and fish, accounting for 26% 30%
just over 30%
– Beverages accounts for 18%
– Dairy products accounts for 13%
– Rice bread, pasta and cereal accounts
for 12.9%
– Others accounts for 26%
Further study shows that the
fastest growing product types 12.90% 18%
in the food service are poultry, 13%
lamb/mutton, fresh fruit and
vegetables, processed meat Meat, Poultry & Fish Beverages
and liquid milk
Dairy products Rice, Bread, pasta & Cerea
Other Products
In-Demand Food
Categories
Based on research interviews carried out with distributors, the fastest
growing categories in the segment are poultry, lamb/mutton, fresh
fruit and vegetables, and processed meat and poultry (i.e., halal)
Also noteworthy is the increasing popularity of low-fat versions of
products, Asian sauces and ingredients, bakery products, coffee and
specialty cheeses
The highest growth and best overall prospects for food and beverage
suppliers are projected to be in the premium channels that cater to
tourists and wealthier locals
Food-Service Channel
The Food-Service Channel The Food-Service Channel
– 4 and 5 star + hotels in the UAE
account for 17% of the total Food- 3% 17%
Service expenditure
– 1, 2 and 3 star hotels account for 38%
21% of the total Food-Service
expenditure
– Casual dining account for 21% of
the total Food-Service expenditure 21%
– Fast-Food outlets account for 38%
of the total Food-Service
expenditure 21%
– Others (i.e Ship Chandlers etc.,)
constitutes just 3% of the total 4 & 5 star hotels 1,2 & 3 Star HotelsCasual dining
Food-Service expenditure
Fast food Others

Customer Analysis
Demographic Trends (1/3)
Population Break-Up by Age-Group
Population Break-Up by Age-Group
– In 2004, those between the ages of 15-
50 years constituted almost 70% of
the population 6%
25%
– This population segment represents a
high number of working expatriates
– High percentage of working
expatriates are disposed to purchase
ready-to-eat meals
– They are compelled to eat at least one
meal per day while on the job, which
pushes up the demand for fast, easy to
consume meals 69%
Below 15 Yrs 15-50 Years Above 50 Years
Population Break-Up by Nationality Population Break-Up by Nationality
(2004)
– The UAE nationals make up only 15% 10%
10% of the population
– The Asian community mainly 15%
people from South Asia (i.e. India
& Pakistan) and the Far East
(China, the Philippines) form
60% of the population.
– The Western expatriates account
60%
for 15%,
– The non-local Arabs account for
only 15% of the total population
Locals Asian Westerns Other Arabs
Annual Income Percentage Income
(2004)(DHS) Wise Break- Group Population Break-Up by Income-Group
Up
Less than 21 Lower 6% 25%
24,000 23%
24,001-36,000 4.3 Lower
36,001-48,000 5.3 Middle
48,001-60,000 23.5 Middle

46%
60,001- 17.2 Middle

108,000
Lower Middle Upper Elite
108,001- 16.3 Upper
180,000
180,001- 6.3 Upper
300,000
Consumption Trends and
Patterns (1\2)
26% of UAE residents eat out at a quick service
restaurant at least once a week, with the frequency of
visits to this type of outlet being some 65% higher
among Emiraties and expat Arabs
Asian cuisine is the most popular of all cuisines and is
growing the fastest
Lebanese food is also continuing to be popular as it
suits Arabic tastes and is also relatively healthy
Since Asians & Arabs constitute the majority, rice
consumption is very high in the UAE
Consumption Trends and
Patterns (2\2)
Dairy products are popular in the region while
statistics suggest UAE consumers eat around
80-85 kg of dairy products per capita per year
It’s believed by some that the market for
energy drink in the Middle East is growing
rapidly as the Muslim population looks for a
beverage that’s is fun but not alcoholic
Analysis Complete

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Food-Service Market –

Industry Trends & Developments 7

Key Players – Hotel Segment 9

Key Players – Fast-Food Segment 10

Factors Supporting The Market 11

Largest Food Product Groups 16

In-Demand Food Categories 17

Consumption Trends and 23

Other Market Outlets:-

Fast food Others

Below 15 Yrs 15-50 Years Above 50 Years

36,001-48,000 5.3 Middle

48,001-60,000 23.5 Middle

60,001- 17.2 Middle

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