UAE's quick service restaurants sector still open for growth

The total value of spending in UAE's food industry is estimated at more than Dhs6.47bn (in wholesale prices) for 2006, with 11% growth in the food services market.

The most important contributing factors are the growing population, relatively high purchasing power, and the significant rise in the number of tourists. Studies indicate that the total spending by tourists in the UAE will reach $7.6bn in 2009 and that Dubai alone is targeting 10 million tourists in 2010.

Demographic factors and lifestyles also play a key role in this high percentage of spending on food services, especially considering the huge numbers of singles, mainly males, and their long working hours which tend to encourage consumption of ready-to-eat meals.

Reports on franchising in the Gulf region show that the fast-food industry in the UAE is still enjoying strong double digit growth year on year for the last five years, and the local quick service restaurant business currently stand at over $1bn.

Industry experts expect that the market will grow even further and that there's still room for new international players, despite the UAE's comparatively large QSR market for its size.
Yasser Abdel Azim, director of marketing and business development for First Food Services L.L.C., the BURGER KING franchisee in the UAE, believes that even though the local markets include many of the most well known names in the QSR sector, many local and regional companies are still looking for new franchises to introduce to the UAE.

"From our long experience in this field and our own market studies, we can see that demand is nowhere near saturation," he says. "This implies that there's still more room in the local and regional markets which are acting as a magnet for many of the international brands within all industries including fast food."

"We at First Food Services are going to introduce a new concept of restaurants in the quick service industry focusing on providing a menu offering that focuses on fresh ingredients.
"But with the increasing costs of living and the heavier burden on incomes, everyone in the QSR sector must consider providing products that fall in the affordable or reasonably affordable category while still appealing to the customer who is willing to pay more for a higher quality product."

The fast food market is set to witness more growth over the next few years, especially with the advent of healthier options that would benefit greatly from local production facilities to provide fresh products directly to the customers without the need for freezing or preservatives, resulting in high-end meals that are tasty and healthy.